Piliero, Mazza and Pargament, PLLC.

Piliero Mazza & Pargament, PLLC Vol. 7, Issue 1, January 2005

Addressing Tribal and Alaska Native Corporation Legal and Business Issues


The articles shown here are excerpts. If you would like to subscribe to the Tribal Advocate, please contact Susan Brock at (202) 857-1000 or at


A R T I C L E S



SOVEREIGN IMMUNITY

Survey Of State Taxation Of Tribal Businesses Part One: Taxation By Agreement

As promised in the last issue, the Tribal Advocate has begun its survey of the power of U.S. states to tax tribally-owned businesses that are not incorporated under state law. In doing so, one fact became abundantly clear: state taxation of tribes is as varied as the individual tribes themselves. As we looked closer, however, certain common characteristics began to surface. In particular, a number of states have entered into tax agreements with tribes in order to create a measure of consistency and certainty from an otherwise hazy combination of federal statutes and case law delineating the meandering outer boundaries of tribal sovereign immunity.

Several years ago, one study placed the number of tribal-state tax agreements at 200, covering a range of issues from sales and use tax to excise taxes on cigarettes, tobacco, liquor and motor fuel. The agreements generally allow tribes and states to determine how each of the respective governments will share the burdens and benefits of taxation on reservations—not entirely unlike an international tax treaty. A tribe may agree to levy a tax at the same level as the state tax and retain all or a portion of the proceeds, or it may agree to collect and remit state taxes on non-Indians. The tax agreement provides opportunities for the state and the tribe to address the particular idiosyncrasies of a state’s tax law and the specific facts and circumstances of successful tribal businesses. As economies change and grow, the parties may amend their agreements to address contemporary concerns.

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GOVERNMENT CONTRACTING

Gao Upholds Agency Evaluation Of Atl Joint Venture

The Comptroller General of the Government Accountability Office (GAO) upheld an agency decision to assign a higher risk score to a joint venture on the basis that the cooperation of the three team members could not be certain. In a sector where teaming with small businesses is more important than ever, this decision could affect HUBZone and Alaska Native- and tribally-owned businesses.

In May 2004, the Department of the Navy (Navy or agency) issued a best-value RFP for construction and maintenance of a new elementary and high school in Sigonella, Italy. A joint venture of three construction companies, collectively referred to as ATL, included Todini Costruzioni Generali (Todini), A.I.A. Costruzioni Generali (AIA), and Lotos S.r.l. (Lotos). The technical evaluation board ranked ATL second overall, and the price evaluation board determined that ATL offered the lowest reasonable price. However, the Source Selection Board (SSB) determined that a competitor, Cooperative Muratori e Ceentisi di Ravenna (CMC) provided the best value, due to its “excellent” ratings for engineering, past performance, and experience (compared to “satisfactory” ratings for ATL). Following award and debriefing, ATL protested to the GAO.

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COURT WATCH

Tribe Can Be Sued For Potential Violation Of State Law Rooted In Federal Constitutional

Recently, a California appeals court ruling posited a new element of the legal relationship between the state and tribes. The decision, to allow the California Fair Political Practice Commission (CFPPC) to proceed in a civil suit against the Santa Rosa Indian Community, asserts that a tribe can be sued for potential violations of state laws rooted in federal constitutional law. To the extent that this case is echoed by other states, or in other areas of law, it could signal that “states rights” may impact the Indian Country.

Between 1998 and 2000, the Santa Rosa Indian Community contributed several hundred thousand dollars to California candidates and political committees. Consequently, the tribe was obligated by California’s Political Reform Act (the Act) to file various disclosure forms, like any other major contributor. Like federal campaign finance laws, public disclosure of state campaign donations is instrumental in insuring a minimum level of transparency and legitimacy. While the tribe initially filed many required disclosure reports, it later filed some disclosure forms late, and failed to report approximately $360,000 of donations in 1998. Consequently, the CFPPC filed a civil suit in Sacramento Superior Court to penalize the tribe for violating the Act.

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GOVERNMENT CONTRACTING

Flurry Of Regulations Blankets Washington High Winds Predicted For February

As the holidays approach, a storm of regulatory activity has appeared over Washington, providing contractors with plenty of reading material as they warm before the fireplace. Agencies all too familiar to small business contractors – the Small Business Administration (SBA), Department of Defense (DOD), and the Federal Acquisition Regulation Council (FAR Council) – have issued final regulations to wrap up the year’s work, and proposed rulemaking to set the tone for the new year. Key among them is SBA’s December 3, 2004, Advanced Notice of Proposed Rulemaking (ANPR), which solicits comments on wholesale revision of the size standard system. (Comments are due by February 1, 2005.) Also new on the books are refinements to the DOD Mentor-Protégé Program, a substantial extension of task order limits, and final rules on subcontracting.

Following withdrawal of the size standard revisions proposed in early 2004, SBA has taken a new approach to updating the size standard system. Rather than proposing another rule, SBA has listed several topics on which it would like to hear comments. Chiefly, SBA wants to know what they can do to simplify size standards. One suggestion is to institute one general set of size standards and another set for federal contractors. Another suggestion would institute a tiered system of size standards, in which the smallest contracts would be reserved for the smallest of the small; likewise for the larger small businesses. Responding to frustrations over having to count each individual as part-time, temporary, or contract employee, SBA has asked for suggestions on implementing a system for counting full-time equivalents. This would be a boon for most contractors, especially if SBA determines that converting revenue-based size standards to employment-based size standards is appropriate. Other topics in the ANPR include changing the way employees are counted for employment-based size standards, transitioning all revenue-based standards to employment based, and revising size rules as applied to concerns financed by venture capital firms.

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THE SUPREME COURT

Before The Court - City Of Sherrill, NY v.Oneida Indian Nation

Oral Arguments in the City of Sherrill, NY v. Oneida Indian Nation will be heard January 11, 2005. The following questions will be presented:

  • Can alleged reservation land, not set aside or superintended by the federal government, be considered part of Indian Country?

  • Did the expulsion of the New York Oneidas from their lands result in the legal disestablishment of their New York reservation?

  • What is the legal disposition of such former reservation land? Is the land part of Indian Country, or otherwise?
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