Tribal, Shawnee officials meet; tax flap continues

Many tribal retail outlets across Oklahoma do not assess city sales taxes on tangible purchases.

 

SHAWNEE, Okla. – Municipal and tribal officials met March 24 to discuss the sales tax revenues generated by tribally-owned businesses, but two vastly different stories about that meeting’s outcome have emerged.

Citing slumping revenue streams, Shawnee city officials have been trying to collect sales tax dollars associated with tangible purchases made by non-Natives at tribal properties with a Shawnee mailing address. The Absentee Shawnee, Citizen Potawatomi Nation, Kickapoo and Sac and Fox each have at least one business that would potentially be impacted if the city is successful.

In a written statement released Monday afternoon, city officials apologized for disrespecting tribal sovereignty and expressed hope that an agreement would be reached through subsequent meetings.

“We are pleased that these tribal leaders were willing to meet with us,” Mayor Wes Mainord said. “The dialogue is important, and I think we all learned something from the discussion.”

Other than to emphasize that no decision has been made regarding potential litigation, the City of Shawnee declined to elaborate beyond its written statement. No dates have been announced for additional meetings between the city and tribal officials.

On the other side of the table, tribal officials were less than thrilled with the meeting at the Citizen Potawatomi Nation’s cultural heritage center. Describing Mainord’s opening remarks  as “syrupy,” Citizen Potawatomi chairman John “Rocky” Barrett took issue with the city’s refusal to acknowledge the tribes’ jurisdictional authority.

“From the perspective of the Citizen Potawatomi Nation, the meeting was little more than a cosmetic attempt to make the city appear reasonable in the public eye because they offered to ‘negotiate,’” Barrett said in a written statement issued Monday evening. “The negotiation was entirely one-sided. The only choice left to the CPN was to meet the city’s demands for tax collections or be sued in federal court. Each tribal leader present countered Mainord with statements of fact that the trust land of their nations is not in Shawnee and not subject to the city’s governmental authority.

“The city has not acted in good faith during these so-called ‘negotiations,’ in particular by making false statements to the media and turning this into a public controversy. Rather than take the time and courtesy, to propose to meet in a demonstration of mutual respect, the city has chosen to threaten litigation and attack as by way of press release prior to the meeting, then act as if they were generous in doing so.”

The largest of the four tribes involved, Citizen Potawatomi Nation has a discount grocery store, a gift shop, a casino and two convenience stores that could potentially be affected if the tribe is forced to start making payments to the City of Shawnee. One of the largest employers in Pottawatomie County, the tribe employs 2,200 people and has an estimated economic impact of more than $522 million.

In an effort to level the playing field, the tribe assesses the same 8.5 percent sales tax on purchases made at its stores as those made at non-tribal stores in the area, but puts a portion of its tax revenue towards scholarship funds and other tribal programs rather than send in money to the City of Shawnee.

As per a 1991 U.S. Supreme Court decision, tribes do not have to remit state sales taxes on purchases made by tribal citizens in tribally-owned businesses located on reservations or trust land. However, the decision does not say anything about taxes levied by county or municipal governments. The decision is also silent on how states are to collect tax revenue generated by non-tribal citizens.

Many other tribal retail outlets across Oklahoma – including those run by the state’s largest tribe, the Cherokee Nation – do not assess city sales taxes on tangible purchases.