Kootenai Tribe’s Sales Tax Bill Pulled Financial Concerns Prompt Removal From State Senate

Lawmakers Tuesday withdrew a bill from the state Senate that would have let the Kootenai Indian tribe keep sales tax revenue from tribal-owned businesses.

Sen. Cecil Ingram, R-Boise, said that concern from Boundary County commissioners and other officials about the bill’s impact on county finances prompted the move.

The bill would have extended sales tax advantages now enjoyed by larger tribes to the smaller Kootenai tribe. Larger Idaho tribes have been exempt from collecting sales tax through tribal-owned retail businesses for the last six years. The bill also would have allowed for some economic development opportunities for the Kootenais, Ingram said.

Boundary County Commissioner Bob Graham spoke Tuesday morning with Ingram about scrapping the bill.

“He (Ingram) had been led to believe there was public involvement and support of the bill. He was surprised to find out there had been none,” Graham said.

“To try and solve this without community involvement is not a good way to go about things.”

Last year, city and county officials met with tribal members before the bill was introduced and were asked for letters of support. But 900 residents signed a petition opposing the bill.

This time, the tribe kept the proposal quiet.

Efforts to reach a Kootenai tribal spokesman were unsuccessful Tuesday.

Ingram said he had thought the commissioners in Boundary County knew about the bill and had signed off on it.

“There was something of a misunderstanding about the bill,” he said, after commissioners had complained that they had not been involved when the bill was introduced.

Letting the Kootenais keep the sales tax money would have cost the state between $200,000 and $400,000. But the economic benefit for the tribe would have made up for the loss, Ingram said.

“It would be nice to get some development for the tribe going up there,” Ingram said. “It would be nice if the Canadian tourists spent a little money in the Bonners Ferry area as well as in Sandpoint and Coeur d’Alene.”

An interim study committee will be formed this summer to examine the bill and to hear from county commissioners. The committee will try to strike a deal so that a more palatable version of the bill could be introduced in the next legislative session, Ingram said.

Graham said the county is not against the tribe’s plan and hopes the summer work session will turn up a compromise.

“I hope the result is a long-term solution rather than having to deal with this brush fire year to year,” he said.

Along with using the extra money to maintain public services, the tribe would have earmarked 40 percent of the money for the tribe’s permanent fund, Ingram said when the bill was introduced. The remainder of the money would have been used to educate tribal members and to establish cultural programs.

The Legislature last year killed four similar sales tax proposals.