Legal Hurdle Cleared For Establishment Of Native Hawaiian Government

The United States Ninth Circuit Court of Appeals has denied a bid to halt an ongoing election that could ultimately establish a Native Hawaiian government, ruling that the challengers had failed to meet the criteria to block the counting of ballots.

Six individuals had appealed to the 9th Circuit saying that links between the Native Hawaiian foundation running the election and state agencies made it an unconstitutional public action. The panel of judges said the individuals had failed to show that they would be irreparably harmed by the vote counting, that the balance of equities favors them, that it is in the public interest to issue an injunction or that they were likely to succeed on the merits of their appeal.

The panel did not provide further reasoning behind its unanimous decision and simply said the appellants had “not made the required showing.”

The election, which concludes on November 30, 2015, will select 40 delegates to a constitutional convention, or 'Aha, which will explore how to reach consensus among Hawaiians on self-determination and whether to create a constitution for a nation, according to the nonprofit Na’i Aupuni Foundation, which is conducting the election using a $2.6 million state grant.

The foundation, the State of Hawaii, and the federal government all argued in favor of the election.


University of North Dakota Abandons "Fighting Sioux" Mascot

University of North President Robert Kelley announces the "Fighting Hawks" nickname for the school on November 18, 2015. Photo by Richard Larson / UND

The University of North Dakota has officially changed its mascot from the “Fighting Sioux” to the "Fighting Hawks". The new name was chosen through an online poll of students, alumni, employees and other interested parties.

"Now, the voters have spoken, and they have told us that Fighting Hawks should be that new nickname," UND President Robert Kelley said. "This is an appropriate choice, as Fighting Hawks symbolizes the competitive spirit of our athletes, the perseverance of the North Dakota spirit, and the continual ascendancy of the university and the state.”

The University maintained the "Fighting Sioux" name and an "Indian head” logo for decades, but the change follows the adoption by the NCAA of a policy that bars the use of "hostile and abusive" mascots. Students, alumni and state officials fought the change for years but they were unable to secure approval from both the Spirit Lake Nation and the Standing Rock Sioux Tribe to continue using the Native-related symbols. The Spirit Lake Nation at one point supported retaining the “Fighting Sioux” name, but the Standing Rock Sioux Tribe remained opposed.



Strategic Guidance For Tribal Infrastructure Projects

Law360 has published a new article with strategic guidance for improving the development of infrastructure in Native American communities.  Better infrastructure is a critical need for Native American tribes aiming to strengthen their economies and serve their members, but attorneys working on these projects need to be alert regarding stiff challenges in financing, physical access, dispute resolution and other key areas to make sure deals don't fall apart.

While energy development and casino projects can generate much-needed cash for transportation, telecommunications, government services and other tribal infrastructure, they can't cover everything, and tribes and their attorneys may have to get creative to secure the funding they need both to get projects done and keep them going, experts say.

Here, Law360 provides six keys for tackling infrastructure in Indian Country.

Remember That One Size Doesn't Fit All

Tribes' infrastructure needs are as diverse as the tribes themselves, depending on the size of the tribe and its location, among other factors, according to Townsend Hyatt, leader of Orrick Herrington & Sutcliffe LLP's tribal finance group.

Smaller tribes will have less demand to meet, while tribes closer to metropolitan areas can often meet their infrastructure needs through a tie-in with local road networks or municipal water systems, he said.

"The real challenge comes from tribes that have a larger membership and are in more rural areas where they can't rely on neighboring governments to help pay for infrastructure," Hyatt said.

The part of the country a tribe's reservation lies in will also help determine what its infrastructure needs are, according to Holland & Knight LLP partner James T. Meggesto. While a tribe in the Southwest might be trying to pave more roads, a tribe in the Northwest may rely on waterways for surface transportation, he said.

With limited tribal and federal government funding available, roads and other infrastructure initiatives can benefit from having tribes identify their own needs, Meggesto said.

"It's why tribes have sought and achieved some level of recognition of their sovereign status and their ability to be the best ones to deliver transportation services on their own territories," he said.

Work With the Funds You've Got

The inability of tribes to tax properties held in trust by the federal government makes finding funds for infrastructure projects a big problem, according to W. Gregory Guedel, chair of Foster Pepper PLLC's Native American practice.

While a local nontribal government may rely on a combination of property taxes and sales taxes to build infrastructure projects, that system of financing isn't available for tribes, he said.

"They have a huge, huge disparity because of that legal status in accessing sources of capital," Guedel said.

With the lack of a well-established tax base to pledge for repayment of large borrowing, tribes have to look for other ways to attract outside investment, according to Hyatt.

Tribes can look for grants, federal appropriations or long-term debt to help finance infrastructure, but they're relative newcomers to the bond market compared to state and local governments, Hyatt said.

"With each year, I think tribes make further inroads into the tax-exempt bond markets, and my hope is one day it's more or less parity," Hyatt said. "We're a long way from that, but the day may come where we really don’t see that much difference."

Leverage the Feds

While infrastructure is an issue throughout the federal government, tribal infrastructure has historically been worse off, attorneys say.

As a result, however, tribes can often make a strong case for federal funding based on their need for better infrastructure, through exclusively Native American programs or in competition for funding with nontribal rural communities, according to Guedel.

Tribes can then take advantage of that federal support to appeal to outside investors, Guedel said. Even remotely located tribes that aren't typically on lenders' radar can access capital if they can show they're eligible for federal matching funds and loan guarantees, he said.

"The tribes that are leveraging those federal programs not only are moving forward with infrastructure development on these types of commercial projects, but are really saving their private capital, their own hard cash, for other things they want to do," Guedel said.

Build a Legal Framework Companies Can Rely On

Having an underlying legal base sophisticated enough to support a tribe's planning and contracting of projects is a must, Guedel said.

"Outside entities are looking for places and projects that have that legal infrastructure behind them, and a tribe that has a solid set of codes and procedures where everybody knows what the rules are," he said.

Physical infrastructure is important, but companies are quite willing to help build new roads out to an oil drilling site, for example, if they're confident that the tribe can handle the deal and tribal government won't interfere, he added.

The most successful tribal codes are as comprehensive and detailed as in other jurisdictions, but incorporate the tribe's traditions as well to ensure members' support for government projects, Guedel said.

"It's really a combination of what you might call Western legal expertise with the inherent tribal culture guiding that expertise, and making sure the codes reflect the values of the tribe," he said.

Link a Tribe's Needs To Its Moneymaker

Tribal casinos and energy projects have the power to attract outside investors — a lure tribes can use to help finance government services and other infrastructure projects on a tribe's reservation, Hyatt said.

"Quite often, a casino will be located on a piece of land where not only is the land undeveloped, but there's nothing there to support a project once developed," Hyatt said. "So you've got to put in sewer and water lines, roads and so forth, and when you do that, there's often an economy of scale so that while you're doing that, you can extend the road to service other areas of the reservation."

The Bakken oil boom in North Dakota shows the high price attached to trying to catch up with infrastructure, Hyatt said.

The Three Affiliated Tribes are reportedly facing as much as a $500 million tab to fix roads on the Fort Berthold Reservation that have been worn down by oil-related traffic.

"Suddenly there's this explosive boom with the Bakken oil reserve, and there's not the housing, the water, the roads, the police — there's just all kinds of stuff that can't keep up with the huge influx of people coming to work there and the growth of the industry in such a short period of time," Hyatt said.

And infrastructure that's less obviously tied in with a particular project, such as telecommunications support, shouldn't be overlooked by tribes, as it's essential for businesses working on reservations, attorneys say.

"We view infrastructure issues as being closely related to the ability to have telecommunications and high-speed Internet, and reliable phone and communications infrastructure," Meggesto said. "Every day the world seems to get more technological, and there are lots of opportunities for tribes and tribal contractors that are going to need that sort of infrastructure."

Know Your Forum If Things Go Wrong

One way to get a project started on the right foot is to make sure parties know what to expect in dispute resolution if things don't go well, attorneys say.

"Whether it's financial investors or construction companies that would build roads, the number-one fear nontribal, outside potential partners have about working with tribes is that if there's a dispute, tribal sovereignty and tribal courts will prevent them from getting a fair hearing or decision," Guedel said.

But that worry is "mostly based on ignorance," he added, noting that many tribal courts in his home region of the Pacific Northwest are actually superior to nontribal courts.

Dispelling the perception that tribal courts may be biased against outside companies requires transparency on key issues, including making sure parties know in what circumstances a tribal court has authority and the limitations on a tribe's contractual sovereign immunity waiver.

"Lawyers have an absolutely crucial role in bringing mutual understanding," Guedel said.

--Editing by Katherine Rautenberg and Philip Shea.


Swinomish Leader Brian Cladoosby Re-Elected NCAI President

Chairman Brian Cladoosby of the Swinomish Indian Tribal Community has been re-elected as President of the National Congress of American Indians. President Cladoosby ran unopposed and was unanimously acclaimed to serve his second two-year term as president at the NCAI’s 72nd Annual Convention held in San Diego. President Cladoosby is also the co-speaker of the Coast Salish Gathering, which comprises British Columbia First Nations and Western Washington Tribes.

President Cladoosby identified the underfunded health care system, lack of support systems for veterans, and the high suicide rate among Native American youth under the age of 25 as primary policy issues for NCAI. “It is a very serious concern that we as tribal leaders need to deal with at home and try to figure out some solutions to this quiet crisis,” Cladoosby said.

On Twitter duringt he election campaign, President Cladoosby noted: “#AmericanIndians & #AlaskaNatives continue to experience the greatest health disparities in the U.S. when compared to other Americans,” and “All #tribes must have the ability to recover their traditional homelands and have their original land base boundaries respected.”

Randy Noka of the Narragansett Indian Tribe was elected to serve as NCAI's First Vice President of the Executive Board, W. Ron Allen of Jamestown S'Kllallam was elected Treasurer, and Aaron Payment of the Sault Ste. Marie Tribe was selected as Board Secretary.


New Initiative To Remove U.S. Oversight Of Tribal Elections


College of Muscogee Nation Student Association members recently registering students to vote. Photo: Cherrah Ridge via

The Obama administration is encouraging tribes to take more control of their internal affairs by eliminating the role of the Bureau of Indian Affairs in overseeing certain elections. Some tribal constitutions require the BIA to handle all aspects of a Tribal election, from determining who can vote to printing up ballots to tallying the results. The practice originated with the Indian Reorganization Act of 1934.

"For many tribes, the requirement for Secretarial elections or Secretarial approval is anachronistic and inconsistent with modern policies favoring tribal self-governance," a notice published in the Federal Register states. To eliminate this "paternalistic approach," the BIA wants tribes to remove provisions in their constitutions that require federal oversight of Secretarial elections. Tribes would no longer have to wait on the agency to review and conduct those types of elections, a process that can delay governance reforms.

The reforms have been in process since the Clinton administration, and the last time the regulations were updated was during the Reagan administration. The Obama held tribal consultations and listening sessions in 2009 and 2010 before proposing a new rule in October 2014. "It is the policy of the federal government to support tribal self-governance as a substitute for federal governance to the maximum extent permitted under federal law," Assistant Secretary Kevin Washburn said.

For tribes that wish to retain BIA oversight of elections, the final rule outlines numerous changes to the process. According to the notice, the final rule becomes effective November 18.


US Proposes New Governmental Relationship For Native Hawaiians

The US Department of Interior has proposed a new federal rule that would allow Native Hawaiians to decide whether they want to to reorganize their government and establish a formal relationship with the U.S.  The DOI called the proposed rule the next step in the reconciliation process with Native Hawaiians that was set in motion in 1993, when the government formally apologized for its role in the 1893 coup of the Hawaiian monarchy.

"Many indigenous groups in the U.S. have the right of self-determination, and today’s announcement acknowledges that that right also belongs to the Native Hawaiian people, one of the largest native communities in the country,” said Rep. Tulsi Gabbard, D-HI. “These rules incorporate over 5,000 public comments submitted to the Department of Interior, and should they be adopted, the Native Hawaiian community will have the option to re-establish a unified government and self-determine their future relationship with the federal government."

“Native Hawaiians have the right to reorganize a government that they determine is best for them,” said Sen. Brian Schatz, D-HI. “With today’s publication of proposed rules from the Department of the Interior, I urge Native Hawaiians and other interested individuals to stay engaged and to contribute their comments and concerns as the process moves forward.

The DOI began the rulemaking process in July 2014, after which 25 public meetings were held across Hawaii and Native American communities. The Department will accept comments on the rule proposal for 90 days.


IRS Requests Comments On Applying "Cadillac" Health Care Tax To Tribes

The IRS is requesting comments on the upcoming 40-percent excise tax on high-cost employer-sponsored health plans, which as currently conceived would apply to Tribal governments and Tribal-owned businesses that provide expansive health care insurance for their workers. Under the Affordable Care Act, the so-called “Cadillac tax” goes into effect in the beginning of 2018 for both fully insured and self-funded employer health plans. The tax will be assessed on the dollar amount of any premium that exceeds the annual limits of $10,200 for individual coverage and $27,500 for family coverage. The tax also includes several other costs such as contributions to flexible spending accounts or health savings plans. Tribal governments in high cost of living regions, such as Alaska, the Northeast, and the West Coast will likely be hit the hardest. In addition to the taxes, there will be a significant administrative burden on tribal government finance and HR staff to complete the mandated reporting. The costs and burdens represented by the regulations will diminish already limited resources available to support tribal government operations.

Comments on Notice 2015-52 can be sent electronically to


IRS Confirms Tribal Trust Payments Not Taxable


Payments Native Americans receive from tribal trust accounts will generally not be considered gross income subject to federal taxes, according to a final notice issued by the Internal Revenue Service. The notice provides clarification and guidance on concerns that arose after some tribes reported receiving letters in April 2012 from the IRS saying that per capita payments from trust accounts are taxable contrary to the Per Capita Act of 1983.

The IRS previously issued a notice saying that per capita trust account payments from a $1 billion settlement the Obama administration made with 41 tribes in April 2012 would not be taxed by the federal government. However, the 2012 notice did not provide guidance on whether other per capita payments made by either the U.S. Department of the Interior or Indian tribes from the trust accounts are subject to tax. Mark Mazur, the U.S. Department of the Treasury’s assistant secretary for tax policy, said the new notice was informed by “extensive consultation with tribal governments, illustrating the value of these discussions to help us better understand the needs of tribal governments.”


US Will Pay Tribes $940M To Settle Contract Management Dispute

The Obama administration has agreed to pay a group of Native American tribes $940 million to settle multi-decade litigation regarding underfunding of law enforcement, education and other federal services on reservations. Interior Secretary Sally Jewell and Justice Department officials plan to announce the proposed class-action settlement Thursday along with leaders from the Oglala Sioux Tribe, Zuni Pueblo and Ramah Chapter of the Navajo Nation. The settlement will then be submitted for approval in federal court.

The $940 million proposed payout to the tribes and tribal agencies is part of a trend toward major settlements between tribes and the U.S. in the last five years. "We had been litigating with Indian Country aggressively before the Obama administration came in," Kevin Washburn, head of the Bureau of Indian Affairs, told The Associated Press. "Rather than the federal government and tribes fighting all the time and litigating against one another, we need to be partners looking toward the future."

The contract litigation settlement is the result of a 2012 U.S. Supreme Court decision ruling in favor of the tribes in the long-running dispute over payment allocations for program costs. Tribes argued the U.S. government did not appropriate enough money to cover costs under the agreements, and the underfunded contracts meant tribes faced shortfalls as they tried to meet essential needs in their communities ranging from health services to housing.


Suquamish Tribe Signs First State Cannabis Compact

The Suquamish Tribe and the Washington State Liquor-Cannabis Board have agreed to terms on the nation's first state-tribal marijuana compact, in what Board Chair Jane Rushford says will be a model for future state-tribal compacts. The 10-year agreement will govern the production, processing and sale of cannabis on the Tribe's land located in Kitsap County, Washington.  Under the terms of the compact, a tribal tax equivalent to the state excise tax will be applied to sales of cannabis to non-tribal customers on Suquamish tribal lands.  The compact will head next to Governor Jay Inslee for approval. A bill passed by the 2015 Legislature allows the governor to enter into marijuana agreements with federally-recognized tribes in Washington state.