Piliero Mazza &
Pargament, PLLC


Vol. I, Issue 10
November 1999


Addressing Tribal and Alaska Native Corporation
Legal and Business Issues


The articles shown here
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A R T I C L E S


BUSINESS
Preserving the
"Corporate Veil" of
Tribally-Owned
Corporations



EMPLOYMENT/LABOR
NLRB Considering
Enlarging Jurisdiction



ASK THE ADVOCATE
ANCs and the Small
Business Requirements

Applicable to 8(a) Firms




INTERVIEW
Timothy Glidden,
Counsel for House
Committee on Resources




ON THE HILL
State Taxation of
Indian Businesses






H O M E


P U B L I C A T I O N S










BUSINESS

Preserving the "Corporate Veil"
of Tribally-Owned Corporations

In a recent article in the Tribal Advocate entitled "Extending Sovereignty to Tribally-Owned Businesses," we discussed several factors that courts often consider in determining whether a tribal business should be entitled to the benefit of the tribe’s sovereign immunity.

  • Have the corporation use a different logo than the tribe.
  • Have title to the corporation’s assets in its own name.
  • Avoid common officers and directors between the corporation and the tribe.
  • Ensure that the corporation’s directors/executives do not take directions from the tribe.
  • Ensure that the corporation’s directors/executives act independently and in the corporation’s interest.
  • Ensure that the corporation does not conduct business exclusively with the tribe.


As can be seen, some of these steps may conflict with the factors that are considered by courts in extending sovereignty to tribally-owned businesses (see article from last month’s Tribal Advocate). Accordingly, reconciliation of these competing factors should be accomplished with the assistance of counsel taking into account the totality of the circumstances and the tribe’s primary objectives.

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ASK THE ADVOCATE

ANCs and the Small Business Requirements
Applicable to 8(a) Firms

 
Q. Do Alaska Native Corporations or Village and Regional Corporations (collectively referred to as ANCs) have to be small businesses to participate in the SBA’s 8(a) program?

A.
To participate in the Small Business Administration’s ("SBA") 8(a) program, a firm must be a small business. However, this does not mean that an ANC itself must be small to participate in the 8(a) program. Rather, the firm owned by the ANC must be small. Generally, the firm’s size is determined independently without regard to its affiliation with the ANC. Thus, an ANC, through a firm in which it owns at least 51% of the stock, may participate in the 8(a) program.

In sum, a firm must be a “small” business to participate in the 8(a) program. If an ANC qualifies as small or owns a small business, it may be eligible to participate in the program, provided the SBA’s other 8(a) eligibility criteria are met.

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INTERVIEW

Tribal Advocate Speaks with Timothy Glidden,
Counsel for the House Commitee on Resources
 
Tribal Advocate recently had the pleasure of interviewing Mr. Timothy Glidden, counsel for the House Committee on Resources, regarding his views on several issues of interest to tribes. The House Committee on Resources has jurisdiction over measures relating to the welfare of Native Americans, including management of Indian lands in general and special measures relating to claims that are paid out of Indian funds. The Committee also has jurisdiction over all matters regarding the relations of the United States with Indians and Indian tribes, matters pertaining to the federal trust responsibility to Native Americans and matters regarding the sovereignty of Native Americans. In addition to its responsibilities with respect to Indian issues, the Committee also has jurisdiction over national parks and public lands, forests and forest health, energy and mineral resources, fisheries, conservation, water and power, wildlife, and oceans. The Committee is chaired by Don Young (R-AK). The ranking minority member on the Committee is George Miller (D-CA).

Tribal Advocate (TA): The Senate has a standing Committee on Indian Affairs, while the House does not even have a subcommittee dedicated to Indian matters. Why is there no such committee or subcommittee in the House, and does Chairman Young believe such a committee or subcommittee should be created?

Timothy Glidden (Glidden): Each Committee of the House is only permitted to have five (5) subcommittees. With most Committees this is adequate, but the Committee on Resources has jurisdiction over such a variety of subject matters that it is difficult to accommodate all matters within their five subcommittees. Therefore, the question facing each chairman is how to divide up the subcommittees. Years ago, when Congressman Morris Udall (D-AZ) was the Chairman, he sometimes retained jurisdiction over Indian affairs at the full committee level. When the Republicans took control of the House, they created a subcommittee for Native American and territorial affairs. Later on, Congressman Don Young decided to retain jurisdiction over Indian Affairs at the full committee level. Many Indian tribes prefer to have their bills considered at full committee instead of going through the subcommittee process.

TA: How partisan do Indian issues tend to be in the Congress?

Glidden: Indian Affairs is one of the few subject matters that is not partisan. Rather, members vote depending upon the constituency within their particular states. If an issue is of significance to a Tribe within a state, then Democrats and Republicans within that state tend to work together.

TA: What are the Committee’s most significant achievements on Indian issues during this Congress so far?

Glidden: Recently the House passed the Rocky Bay's Water Settlement Act which is the first water settlement act negotiated by the Clinton Administration since it took office in 1993. The administration is expected to sign the Act. This Congress has passed many other bills, but this one is very important to all Indian tribes.

TA: What action is the Committee taking to correct the problems with the management of Indian trust funds by the BIA?

Glidden: There are several bills pending in Congress that seek to make changes to the way that Indian trust fund accounts are handled. However, this is a very tough question. There are two kinds of funds. There are tribal funds, which are used for the benefit of the entire tribe, and then there are Individual Indian Money Accounts (IIM) which were created because parcels of land may be owned by many individual Indians under the Allotment Act. With respect to each of these accounts, there are questions with respect to what should be done to compensate for the mismanagement that has occurred. In addition, there is the question of what legislation can be put into place to ensure that mismanagement does not occur in the future. The Committee has spoken with many tribes, government officials and other individuals regarding possible solutions to the problem, but at this point in time there is little agreement. I am hopeful that discussions will continue and that a solution may be forged soon.

TA: What actions are being considered by the Committee to help tribes who are having difficulty getting states to negotiate with them regarding the operation of gaming facilities under IGRA?

Glidden: We are hoping to work with all involved groups to structure a solution to this problem. The Supreme Court decision in the Seminole case held that the states can notducation, law enforcement and combating alcoholism. Notwithstanding the availability of these funds, many tribes are more interested in preserving their allocations than in developing separate new programs which may not prove to be beneficial.

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EMPLOYMENT/LABOR

Pending Legislation Regarding State Taxation
of Indian Businesses

As sovereign entities, Indian tribes are generally immune from state taxes absent federal authorization. However, courts have consistently held that states may impose various excise taxes, including taxes on fuel and tobacco sales, on tribal retail sales to non-Indians. States have claimed difficulties in enforcing these taxes, as they are powerless to sue tribes to collect back taxes. In addition, non-Indian business owners have complained that they face unfair competition from tribal-owned retailers which do not pay state sales taxes. These states and business owners have lobbied Congress to enact federal laws to induce tribes to collect and pay taxes on sales to non-Indians.

These lobbying efforts have begun to bear fruit. Presently, there are two bills pending in Congress relating to the taxation of tribal-owned retailers. In the Senate, S.550 would establish a limited waiver of tribes’ sovereign immunity and permit states to sue tribal retailers in federal court to collect and remit state sales taxes.

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