Source: https://www.law.cornell.edu/supremecourt/text/448/136
Timestamp: 2016-10-24 00:09:45
Document Index: 758164346

Matched Legal Cases: ['§ 476', '§ 40641', '§ 40', '§ 40', 'Art. 1', '§ 8', '§ 405', '§ 406', '§ 407', '§ 466', '§ 1451', '§ 450', '§ 461', '§ 196', '§ 105', '§ 104']

White Mountain Apache Tribe v. Bracker | US Law | LII / Legal Information Institute
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Argued: January 14, 1980
Decided: June 27, 1980
(c) Imposition of the taxes in question would undermine the federal policy of assuring that the profits from timber sales would inure to the [p137]
In this case, we are once again called upon to consider the extent of state authority over the activities of non-Indians engaged in commerce on an Indian reservation. The State of Arizona seeks to apply its motor carrier license and use fuel taxes to petitioner Pinetop Logging Co. (Pinetop), an enterprise [p138]
The Tribe is organized under a constitution approved by the Secretary of the Interior under the Indian Reorganization Act, 25 U.S.C. § 476. The revenue used to fund the Tribe's governmental programs is derived almost exclusively from tribal enterprises. Of these enterprises, timber operations have proved by far the most important, accounting for over 90% of the Tribe's total annual profits.
The Fort Apache Reservation occupies over 1,650,000 acres, including 720,000 acres of commercial forest. Approximately 300,000 acres are used for the harvesting of timber on a "sustained yield" basis, permitting each area to be cut every 20 years without endangering the forest's continuing productivity. Under federal law, timber on reservation land is owned by the United States for the benefit of the Tribe, and cannot be harvested for sale without the consent of Congress. [p139]
Since it first entered into agreements with FATCO in 1969, Pinetop has been required to fell trees, cut them to the correct size, and transport them to FATCO's sawmill in return for a contractually specified fee. Pinetop employs approximately 50 tribal members. Its activities, performed solely on the Fort Apache Reservation, are subject to extensive federal control
sought to impose on Pinetop the two state taxes at issue here. The first, a motor carrier license tax, is assessed on "[e]very common motor carrier of property and every contract motor carrier of property." Ariz.Rev.Stat.Ann. § 40641(A)(1) (Supp. 1979). Pinetop is a "contract motor carrier of property," since it is engaged in "the transportation by motor vehicle of property, for compensation, on any public highway." § 40-601(A)(1) (1974). The motor carrier license tax amounts to 2.5% of the carrier's gross receipts. § 40-641(A)(1) (Supp. 1979). The second tax at issue is an excise or use fuel tax designed "[f]or the [p140]
and then brought suit in state court, asserting that, under federal law, the taxes could not lawfully be imposed on logging activities conducted exclusively within the reservation or on hauling activities on Bureau of Indian Affairs and tribal roads.
Both petitioners and respondents moved for summary judgment on the issue of the applicability of the two taxes to Pinetop. Petitioners submitted supporting affidavits from the manager of FATCO, the head forester of the Bureau of Indian Affairs, and the Chairman of the White Mountain Apache Tribal Council; respondents offered no affidavits disputing [p141]
and the petitioners appealed to the Arizona Court of Appeals. The Court of Appeals rejected petitioners' preemption claim. 120 Ariz. 282, 585 P.2d 891 (1978). Purporting to apply the test set forth in Pennsylvania v. Nelson, 350 U.S. 497 (1956), the court held that the taxes did not conflict with federal regulation of tribal timber, that the federal interest was not so dominant as to preclude assessment of the challenged state taxes, and that the federal regulatory scheme did not "occupy the field." The court also concluded that the state taxes would not unlawfully infringe on tribal self-government. The Arizona Supreme Court declined to review the decision of the Court of Appeals. We granted certiorari. 444 U.S. 823 (1980) .
Although "[g]eneralizations on this subject have become . . . treacherous," Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148 (1973), our decisions establish several basic principles with respect to the boundaries between state regulatory authority and tribal self-government. Long ago, the Court departed from Mr. Chief Justice Marshall's view that "the laws of [a State] can have no force" within reservation boundaries, Worcester v. Georgia, 6 Pet. 515, 561 (1832).
See Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 481-483 [p142]
(1976); New York ex rel. Ray v. Martin, 326 U.S. 498 (1946); Utah & Northern R. Co. v. Fisher, 116 U.S. 28 (1885). At the same time, we have recognized that he Indian tribes retain "attributes of sovereignty over both their members and their territory." United States v. Mazurie, 419 U.S. 544, 557 (1975). See also United States v. Wheeler, 435 U.S. 313, 323 (1978); Santa Clara Pueblo v. Martinez, 436 U.S. 49, 55-56 (1978). As a result, there is no rigid rule by which to resolve the question whether a particular state law may be applied to an Indian reservation or to tribal members. The status of the tribes has been described as "‘an anomalous one and of complex character,'" for, despite their partial assimilation into American culture, the tribes have retained
Congress has broad power to regulate tribal affairs under the Indian Commerce Clause, Art. 1, § 8, cl 3. See United States v. Wheeler, supra at 322-323. This congressional authority and the "semi-independent position" of Indian tribes have given rise to two independent but related barriers to the assertion of state regulatory authority over tribal reservations and members. First, the exercise of such authority may be preempted by federal law. See, e.g., Warren Trading Post Co. v. Arizona Tax Comm'n, 380 U.S. 685 (1965); McClanahan v. Arizona State Tax Comm'n, supra. Second, it may unlawfully infringe "on the right of reservation Indians to make their own laws and be ruled by them." Williams v. Lee, 358 U.S. 217, 220 (1959). See also Washington v. Yakima Indian Nation, 439 U.S. 463, 502 (1979); Fisher
v. District Court, 424 U.S. 382 (1976) (per curiam); Kennerly v. District Court of Montana, 400 U.S. 423 (1971). The two barriers are independent because either, standing alone, can be a sufficient basis for holding state law inapplicable to activity undertaken on the reservation or by tribal members. They are related, however, in two important ways. The right of tribal self-government is ultimately dependent on and subject to the broad power of Congress. Even so, traditional notions of Indian self-government are so deeply engrained in our jurisprudence that they have provided an important "backdrop," McClanahan v. Arizona State Tax Comm'n, supra at 172, against which vague or ambiguous federal enactments must always be measured.
The unique historical origins of tribal sovereignty make it generally unhelpful to apply to federal enactments regulating Indian tribes those standards of preemption that have emerged in other areas of the law. Tribal reservations are not States, and the differences in the form and nature of their sovereignty make it treacherous to import to one notions of preemption that are properly applied to the other. The tradition of Indian sovereignty over the reservation and tribal members must inform the determination whether the exercise of state authority has been preempted by operation of federal law. Moe v. Salish & Kootenai Tribes, supra at 475. As we have repeatedly recognized, this tradition is reflected and encouraged in a number of congressional enactments demonstrating a firm federal policy of promoting tribal self-sufficiency and economic development.
Ambiguities in federal [p144]
law have been construed generously in order to comport with these traditional notions of sovereignty and with the federal policy of encouraging tribal independence. See McClanahan v. Arizona State Tax Comm'n, supra at 174-175, and n. 13. We have thus rejected the proposition that, in order to find a particular state law to have been preempted by operation of federal law, an express congressional statement to that effect is required.
Warren Trading Post Co. v. Arizona Tax Comm'n, supra. At the same time, any applicable regulatory interest of the State must be given weight, McClanahan v. Arizona State Tax Comm'n, supra at 171, and "automatic exemptions ‘as a matter of constitutional law'" are unusual. Moe v. Salish & Kootenai Tribes, 425 U.S. at 481, n. 17.
When on-reservation conduct involving only Indians is at issue, state law is generally inapplicable, for the State's regulatory interest is likely to be minimal, and the federal interest in encouraging tribal self-government is at its strongest. See Moe v. Salish & Kootenai Tribes, supra at 480-481; McClanahan v. Arizona State Tax Comm'n. More difficult questions arise where, as here, a State asserts authority over the conduct of non-Indians engaging in activity on the reservation. In such cases, we have examined the language of the relevant federal treaties and statutes in terms of both the broad [p145]
policies that underlie them and the notions of sovereignty that have developed from historical traditions of tribal independence. This inquiry is not dependent on mechanical or absolute conceptions of state or tribal sovereignty, but has called for a particularized inquiry into the nature of the state, federal, and tribal interests at stake, an inquiry designed to determine whether, in the specific context, the exercise of state authority would violate federal law. Compare Warren Trading Post Co. v. Arizona Tax Comm'n, supra, and Williams v. Lee, supra, with Moe v. Salish & Kootenai Tribes, supra, and Thomas v. Gay, 169 U.S. 264 (1898). Cf. McClanahan v. Arizona State Tax Comm'n, 411 U.S. at 171; Mescalero Apache Tribe v. Jones, 411 U.S. at 148.
With these principles in mind, we turn to the respondents' claim that they may, consistent with federal law, impose the contested motor vehicle license and use fuel taxes on the logging and hauling operations of petitioner Pinetop. At the outset, we observe that the Federal Government's regulation of the harvesting of Indian timber is comprehensive. That regulation takes the form of Acts of Congress, detailed regulations promulgated by the Secretary of the Interior, and day-to-day supervision by the Bureau of Indian Affairs. Under 25 U.S.C. §§ 405-407, the Secretary of the Interior is granted broad authority over the sale of timber on the reservation.
Timber on Indian land may be sold only with the consent of the Secretary, and the proceeds from any such sales, less administrative expenses incurred by the Federal Government, are to be used for the benefit of the Indians or transferred to the Indian owner. Sales of timber must "be based upon a consideration of the needs and best interests of the Indian owner and his heirs." 25 U.S.C. § 406(a). The statute specifies the factors which the Secretary must consider in making that determination.
In order to assure the continued productivity of timber-producing land on tribal reservations, timber on unallotted lands "may be sold in accordance with the principles of sustained yield." 25 U.S.C. § 407. The Secretary is granted power to determine the disposition of the proceeds from timber sales. He is authorized to promulgate regulations for the operation and management of Indian forestry units. 25 U.S.C. § 466.
Acting pursuant to this authority, the Secretary has promulgated a detailed set of regulations to govern the harvesting [p147]
The Secretary has also promulgated detailed regulations governing the roads developed by the Bureau of Indian Affairs. [p148]
In these circumstances, we agree with petitioners that the federal regulatory scheme is so pervasive as to preclude the additional burdens sought to be imposed in this case. Respondents seek to apply their motor vehicle license and use fuel taxes on Pinetop for operations that are conducted solely on Bureau and tribal roads within the reservation.
There is no room for these taxes in the comprehensive federal regulatory scheme. In a variety of ways, the assessment of state taxes would obstruct federal policies. And equally important, respondents have been unable to identify any regulatory function or service performed by the State that would justify [p149]
Finally, the imposition of state taxes would adversely affect the Tribe's ability to comply with the sustained [p150]
Respondents' argument is reduced to a claim that they may assess taxes on non-Indians engaged in commerce on the reservation whenever there is no express congressional statement [p151]
to the contrary. That is simply not the law. In a number of cases we have held that state authority over non-Indians acting on tribal reservations is preempted, even though Congress has offered no explicit statement on the subject. See Warren Trading Post Co. v. Arizona Tax Comm'n, 380 U.S. 685 (1965); Williams v. Lee, 358 U.S. 217 (1958); Kennerly v. District Court of Montana, 400 U.S. 423 (1971). The Court has repeatedly emphasized that there is a significant geographical component to tribal sovereignty, a component which remains highly relevant to the preemption inquiry; though the reservation boundary is not absolute, it remains an important factor to weigh in determining whether state authority has exceeded the permissible limits. "‘The cases in this Court have consistently guarded the authority of Indian governments over their reservations.'" United States v. Mazurie, 419 U.S. at 558, quoting Williams v. Lee, supra, at 223. Moreover, it is undisputed that the economic burden of the asserted taxes will ultimately fall on the Tribe.
Id. at 691. The present case, we conclude, [p153]
The shift in approach is discussed in Williams v. Lee, 358 U.S. 217, 219 (1959); Organized Village of Kake v. Egan, 369 U.S. 60, 71-75 (1962); and McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 172 (1973).
For example, the Indian Financing Act of 1974, 25 U.S.C. § 1451
et seq., states:
Similar policies underlie the Indian Self-Determination and Education Assistance Act of 1975, 25 U.S.C. § 450
et seq., as well as the Indian Reorganization Act of 1934, 25 U.S.C. § 461
et seq., whose
In the case of "Indians going beyond reservation boundaries," however, a "nondiscriminatory state law" is generally applicable in the absence of "express federal law to the contrary." Mescalero Apache Tribe v. Jones, supra at 148-
Federal policies with respect to tribal timber have a long history. In United States v. Cook, 19 Wall. 591 (1874), and Pine River Logging Co. v. United States, 186 U.S. 279 (1902), the Court held that tribal members had no right to sell timber on reservation land unless the sale was related to the improvement of the land. At the same time, the Court interpreted the governing statute as designed
25 U.S.C. § 196; United States v. Mitchell, 445 U.S. 535 (1980).
Of course, the fact that the economic burden of the tax falls on the Tribe does not, by itself, mean that the tax is preempted, as Moe v. Salish & Kootenai Tribes, 425 U.S. 463 (1976), makes clear. Our decision today is based on the preemptive effect of the comprehensive federal regulatory scheme, which, like that in Warren Trading Post Co. v. Arizona Tax Comm'n, 380 U.S. 685 (1965), leaves no room for the additional burdens sought to be imposed by state law.
Respondents also contend that the taxes are authorized by the Buck Act, 4 U.S.C. § 105
et seq., and the Hayden-Cartwright Act, 4 U.S.C. § 104. In Warren Trading Post Co. v. Arizona Tax Comm'n, supra at 691, n. 18, we squarely held that the Buck Act did not apply to Indian reservations, and respondents present no sufficient reason for us to depart from that holding. We agree with petitioners that the Hayden-Cartwright Act, which authorizes state taxes "on United States military or other reservations," was not designed to overcome the otherwise preemptive effect of federal regulation of tribal timber. We need not reach the more general question whether the Hayden-Cartwright Act applies to Indian reservations at all.
After allowance for that credit, the total amount of the disputed taxes for the 4 1/2-year period is reduced to about $25,000 or $5,000-$6,000 per year. [p154]
The taxes actually in dispute, however, are considerably less. Pinetop concedes that some of its operations are subject to tax, and the State concedes that Pinetop is entitled to additional credits. To understand these concessions, it is necessary to note that Pinetop's vehicles operate on four different kinds of roads within the Fort Apache Reservation: (1) state highways; (2) federally funded (Bureau of Indian Affairs) roads serving recreational public needs; (3) tribal roads exclusively financed and maintained by the Indians; and (4) private logging roads built and maintained by loggers such as Pinetop.
Although Pinetop represents that its use of the Arizona state highways within the reservation is extremely limited, it does not dispute its tax liability for such use. On the other hand, in this Court, the State expressly conceded that its assessments were improper under state law to the extent that they applied to operations on either private logging roads
If it is conceded that the State may tax Pinetop's use of public roads maintained by the State and may not tax the use of tribal or private roads, the question that arises is whether the public roads maintained by the [p156]
Bureau of Indian Affairs are more akin to the former or to the latter. It appears that the BIA roads are like the state highways, insofar as they are open to use by the general public.
On the other hand, it also appears that they were constructed [p157]
and maintained by the Federal Government, and are policed by federal and tribal officers.
Even assuming, however, that the state courts would uphold the imposition of taxes based on the use of BIA roads, despite their similarities to private and tribal roads, I would not find those taxes to be preempted by federal law. In Warren Trading Post v. Arizona Tax Comm'n, 380 U.S. 685, the Court held that state taxation of a non-Indian doing business with a tribe on the reservation was preempted because the taxes threatened to "disturb and disarrange" a pervasive scheme of federal regulation, and because there was no governmental interest on the State's part in imposing such a burden. See Central Machinery Co. v. Arizona State Tax Comm'n, post at 168 (STEWART, J., dissenting). In this case, we may assume, arguendo, that the second factor relied [p158]
From a practical standpoint, the Court's prediction of massive interference with federal forest management programs seems overdrawn, to say the least. The logging operations involved in this case produced a profit of $1,508,713 for the Indian tribal enterprise in 1973. As noted above, the maximum annual taxes Pinetop would be required to pay would [p159]
QUESTION: Did I understand you to say that Arizona has no responsibility for maintaining the BIA roads?