state tax exemptions and reform planning national intertribal tax alliance september 17, 2015
TRANSCRIPT
State Tax Exemptionsand Reform Planning
National Intertribal Tax AllianceSeptember 17, 2015
Welcome
Moderator: Aubrey Seffernick, Partner, Miller Nash Graham &
Dunn LLP
Panelists: James T. Meggesto, Partner, Holland & Knight LLP Mary Streitz, Partner, Dorsey Whitney LLP F. Michael Willis, Partner, Hobbs, Strauss, Dean &
Walker LLP
Introduction
Survey of the tools a Tribe can use to resolve taxing jurisdiction issues with the state
Whether it be asserting an immunity, resolving a “grey area,” or pushing for a legislative exemption as good public policy
Overview
Legislation: the carpenter’s pencil Litigation: the hammer Tribal-State Compacts: the level Business Structures: the monkey wrench Agency letter rulings and interpretations: the
chisel
Legislation When is legislation a good tool? Current issues being addressed through
legislative efforts:– Federal
• Authority to issue tax-exempt debt• Income of minors• Streamline sales tax collection• Tribal charities classified as public charities
– State• Taxation of off-reservation property• Areas with strong public policy implications
Legislation, cont.
Case Study:– HB 1287 in Washington State regarding fee land owned by
the tribe– Original Bill: expand definition of “essential governmental
services” to include “economic development” for property tax exemption on land owned in fee by a tribe.
– Bill as enacted: PILT provision added; cut-off & sunset added
– Legal Challenge: King County Superior Court declared the PILT provision unconstitutional holding that the PILT is a property tax and, as such, violates the uniformity provision of the State Constitution.
Litigation
When is litigation the best or only option? What can a tribe do to prepare a case for
litigation? What are some issues we expect will only be
resolved through litigation? Examples:– AUTO v. State– Tulalip Quil Ceda Village
Tribal-State Compacts
What issues are ripe for state tribal agreements?
What are some of the issues that will bring the state to the table?– Enforcement issues– Tax parity– Collection from non-Indians– Uniform regulatory structure
Tribal-State Compacts, cont.
Examples:– Fuel compacts– Cigarette tax compacts– Liquor tax compacts– New: HB 2000 Washington State Cannabis Compacts
Business Structure
What tax consequences can be avoided through careful business planning or deal structuring?– Tribe itself– Tribal corporation– Section 17 corporation– State entity with majority tribal ownership
Agency Rulings
What issues may be chipped away at through negotiations with state revenue or other agencies?
Examples of resolution that might be reached through a state revenue department:– Interpretive statement/FAQ’s– Letter Rulings: e.g. applying Bracker to facts a tribe
offers– Settlement for a specific assessment – Closing Agreement - Minimal burdens analysis
Agency Rulings, cont.
What is the scope of the agency’s authority?
Can the state agency assist the tribe with resolving issues with a local jurisdiction?
Can the state agency provide certainty for business partners or vendors?
Thank You
Aubrey Seffernick: [email protected]
James Meggesto: [email protected]
Mary Streitz: [email protected] F. Michael Willis: [email protected]