House limits tax negotiations
BOISE – The Idaho House passed legislation Thursday to impose a deadline on tax negotiations between the governor and the state’s Indian tribes that sell gasoline, though opponents warned that the bill jeopardizes good relations between the state and the tribes.
In anticipation of the vote, the Shoshone-Bannock Tribes passed a resolution to begin taxing agricultural products raised by non-Indian farmers on their reservation, which lies at the heart of southeastern Idaho’s potato country. The tribes said they’ll impose that tax if Idaho tries to tax tribal fuel sales without a negotiated agreement.
“I think it’s regrettable on the part of the Sho-Bans; I think it’s equally as regrettable on the part of the state to enforce this,” said Sen. Mike Jorgenson, R-Hayden Lake, chairman of the Idaho Indian Affairs Council. “They were negotiating in good faith, and I just think all of that is lost on the House.”
The House vote was 49-18; the bill, HB 249a, now moves to the Senate.
The Shoshone-Bannocks’ Fort Hall reservation includes about 90,000 acres leased to non-Indian farmers, which produce $150 million worth of agricultural products each year.
“It’s mostly potatoes,” said Gary Gould, the tribe’s lobbyist in Boise. “Their resolution indicated they will renegotiate leases to cover any loss of revenue from fuel tax.”
House Speaker Lawerence Denney, who backed HB 249a, said, “That’s their prerogative. … We’ll see what they do. I think they’ll negotiate.”
The measure says if an acceptable agreement on fuel taxes isn’t reached between the state and the tribes by Dec. 1, the state wins and can impose the state fuel tax on reservation fuel sales. Currently, the tribes charge their own gas tax on reservation sales. A year ago, lawmakers held off on legislation designed to force the issue in favor of allowing negotiations.
“The tribes promised that they would negotiate with the governor. That has not happened,” House Transportation Chairwoman JoAn Wood, R-Rigby, told the House. “They say it is because we have had three governors in this time. … That is not a good reason to not have that done.”
However, Gov. Butch Otter already has begun negotiations with the tribes, picking up from where former Gov. Jim Risch left off in November.
Rep. James Ruchti, D-Pocatello, told the House, “The gentleman who was our governor (Risch) had many things on his plate. … That is not the tribes’ fault. … They were just waiting for somebody to sit down across the table from them, and that did not happen.”
HB 249a, he said, “in essence makes the state of Idaho the judge, the jury and the party to this issue. That is not good-faith negotiation – that is holding a gun to the head of the other party.”
Rep. Rich Wills, R-Glenns Ferry, said, “After a while, if there’s good-faith negotiations, there should be a conclusion, and I haven’t seen a conclusion. … We’re just losing money every year.”
Rep. Marv Hagedorn, R-Meridian, said, “This is not a bill about the tribes. This is not a bill about any ethnic group or people. This is about our roads.”
Wood said the state is missing out on more than $3 million a year in gas taxes it could be imposing on reservation gas sales.
Past attempts by the state to impose that tax on reservation sales all have failed in court on constitutional grounds, because the state can’t tax another sovereign nation. But Wood said a new U.S. Supreme Court decision in a Kansas case “puts us on firm ground” to impose the tax.
Rep. George Sayler, D-Coeur d’Alene, who serves on the Idaho Indian Affairs Council, said, “One of the things the Indian Affairs Council has tried hard to do is to build a trust relationship between the state and the tribes. I think this will set that back considerably.”
Denney said the state is close to reaching agreements with the Coeur d’Alene and Nez Perce tribes, but things haven’t gone as well with the Shoshone-Bannocks.
Gould said, “We’re still negotiating. We’re just waiting to hear something from the governor’s office.”