Tribal leaders hand illusionary sovereignty, tax collection to North Dakota state government

MHA Nation alcohol tax sharing agreement with the state likely unconstitutional

On Friday, March 22 North Dakota Gov. Doug Burgum, as well as Chairman Mark Fox — Mandan, Hidatsa and Arikara Nation — and State Tax Commissioner Brian Kroshus signed a “historic” alcohol tax revenue sharing agreement, the first of its kind, under a new North Dakota State law which was enacted last year. 

According to a press release from Gov. Burgum’s office, tribal nations that adopt the alcohol tax will keep 80% of the tax revenue. In comparison, the state’s general fund will receive 20%, with all taxes collected by the North Dakota Office of State Tax Commissioner. The MHA Nation is the first tribe to execute an agreement with the State under the new law. 

According to available records, the MHA Nation Tribal Business Council, TBC, authorized chairman Mark Fox to agree with its passage of tribal resolution number 24-022-FWF during a regular meeting of the Council held Jan. 10.

The resolution claims that the agreement attached to the resolution will help support tribal sovereignty and economic development on the Fort Berthold Reservation. One can only hypothesize that the more than one billion barrels of oil produced on the Fort Berthold Indian Reservation must be nothing but chump change and therefore does not count as economic development, so now they need to tax booze. 

The TAT Tribal Business Council, TBC, must surmise that the best way to develop its economy is to sell its illusionary sovereignty for 80% of an alcohol tax and allow the State to tax tribal members and guests to make up for the pittance that MHA has received from oil and gas income. 

I do not share the same perspective as the TBC. As a tribal citizen, I would categorize the tax-sharing agreement as a disgusting, sovereignty sell-out, notwithstanding the fancy legalese to the contrary contained and shamelessly utilized throughout the document. One can only imagine state officials are eagerly awaiting another tribe to exhibit interest and sign a similar agreement.

The state officials await, satirically, much the way my boys used to wait for a head to pop up in the popular pizza arcade game, Whac-A-Mole, at Happy Joe’s in Dickinson, N.D.

There are two tax types affected by the resolution and agreement, the Alcoholic Beverages Wholesale Taxes and Alcoholic Beverages Gross Receipts Taxes which will be imposed on all purchases affected by the agreement. 

The TBC bases its authority to enter into the agreement under Article VI, Section 5 of the Constitution and By-Laws of the Three Affiliated Tribes. Under that section, the TBC claims it has the authority to enter into tax collection compacts or agreements with the State. However, after reading Article VI, Section 5, there is no such specific language contained to back up the TBC’s apparent baseless claim. 

Section 1 in Article VI, however, states: “The Three Affiliated Tribes of the Fort Berthold Reservation, acting through their Tribal Business Council, shall have the powers granted by this Article; but any power exercised through that Council shall be subject to a popular referendum as provided by this Constitution.”  

Section 5 states: “The Tribal Business Council shall have the following powers, the exercise of which shall be subject to popular referendum as hereinafter provided in this Constitution.”

The Agreement

That means the tribal citizens have the final say, not the TBC, on whether we allow ourselves to be taxed or not. Mark Fox must think he’s King George III and “We, the People” have no rights at all.

The MHA Nation agreed it will not seek any entitlements on any federal legal grounds, including federal preemption, whether statutorily provided for or otherwise, concerning the taxes that are subject to the Agreement. In other words, the TBC agrees not to enforce any of its federal rights, including Treaty Rights, and apparently, the TBC has absolved the federal government of its trust responsibility and fiduciary duties it owes to the Tribes and its membership as it relates to this Agreement. 

It makes me wonder, “What’s next, game and fish?”

The MHA Nation has agreed that all retailers selling alcoholic beverages within the exterior boundaries of the Fort Berthold Reservation must possess a valid license from the State. In addition, Tribal retailers must obtain a North Dakota Sales and Use Tax Permit. All taxes covered by the agreement will be remitted to the state and any entity chartered under tribal law and operating within the exterior boundaries of the Fort Berthold Reservation is subject to one tax in the amount provided for, under state law.

The MHA Nation has agreed that any provision in any state tax law that allows enrolled members living on the reservation to make purchases exempt from any taxes subject to the agreement may not be exercised while the agreement remains in force. 

The TBC agreed the state retains the authority to collect, administer, and enforce the collection requirements according to state law and administrative rules of the taxes subject to the agreement. 

To carry out the purpose and intent of the agreement, only one tax per tax type will be collected. The MHA Nation has delegated to the state, as MHA Nation’s agent, the MHA Nation’s authority to collect, administer, and enforce the tribal taxes contained within the agreement. 

Upon request of the state, the MHA Nation will assist the state in its administration and enforcement efforts related to the taxes subject to the agreement. Any administration and enforcement efforts may include assessment of tax, audit, collection of tax, litigation, inspections of contraband or violation of statutes, and enforcement of reporting, registration, or licensure provisions. 

Tribal Resolution #24-022-FWF and the agreement do not support tribal sovereignty. It is the exact opposite, it’s illusionary sovereignty. It is also more than likely unconstitutional because only the Tribal citizens can delegate any authority through a referendum vote. The literal definition of sovereignty is a self-governing state. I mention this, just in case you forgot. 

Gowits