A Tax On The Checkerboard

Fractionation of Pine Ridge Reservation (Villageearth.org)

The exterior boundaries of Tribal reservations are usually fairly well defined, and provide a delineation for when one is leaving state land and entering “Indian Country”. However, the ownership and control of land within the bounds of the reservation is often far less clear. Through previous federal policies such as allotment and termination, much Native land was alienated from Tribal ownership. As a result, ownership maps of present-day reservations often resemble a “checkerboard”, with plots of non-Native-owned land interspersed with Tribal trust lands.

For many Tribes, reacquiring the land within reservation boundaries is both an economic and cultural imperative, and Tribal leaders seek creative legal and business methods of eliminating the checkerboard. The Tulalip Tribes in Washington are presently considering a unique economic tool in this regard: imposing a tax on sales of land by Tribal members to non-Natives. The Tulalip Grassroots Committee, an organization of Tribal members, has proposed a 17 percent tax on the land value on real estate transactions to discourage Tribal members from selling land to non-Native buyers. "We believe the reservation is sacred and we wanted to make sure that not as much land goes out of trust status," states Tulalip Chairman Mel Sheldon.

With real estate prices plummeting nationwide in the tumult of the current economic crisis, Tribes with cash are positioned to more quickly eliminate checkerboard spaces within reservations. While a tax such as that proposed by Tulalip may help reduce alienation of Tribal lands, there is also risk of alienating the surrounding business community by raising a new barrier to transactions on reservations. Balancing the interests of internal cohesiveness and positive external relations will become increasingly important as Tribes navigate through the current nationwide economic crisis.
 

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