Opinion ID: 221996
Heading Depth: 3
Heading Rank: 1

Heading: Relevant Legislation: IMLA and IMDA

Text: In the present case, the leases and agreements entered into by the Ute Tribe were executed under the IMLA and IMDA. In Cotton Petroleum, the Supreme Court evaluated the IMLA under standard principles of statutory interpretation and determined that the IMLA neither expressly permits state taxation nor expressly precludes it. 490 U.S. at 177, 109 S.Ct. 1698; see Montana v. Crow Tribe of Indians, 523 U.S. 696, 714, 118 S.Ct. 1650, 140 L.Ed.2d 898 (1998) (stating that  Cotton Petroleum clarified that neither the IMLA, nor any other federal law, categorically preempts state mineral severance taxes imposed, without discrimination, on all extraction enterprises in the State, including on-reservation operations); see also R. at 218-19 (As there was no doubt at the time of enactment of the IMLA that leases on public lands were subject to state taxation, the Supreme Court [in Cotton Petroleum ] inferred that Congress would have understood Tribal leases to be equally subject to state taxation.). The same conclusion applies in this casethe IMLA, which governs almost all of the leases and agreements between the Ute Tribe and the oil and gas operators, does not expressly permit or expressly authorize taxation. [22] The other relevant statute at issue in this case is the IMDA. The IMDA was enacted to provide Indian tribes with flexibility in the development and sale of mineral resources, Quantum Exploration, Inc. v. Clark, 780 F.2d 1457, 1458 (9th Cir.1986), by authorizing tribes to enter into mineral agreements with developers, such as joint-venture and product-sharing agreements. See 25 U.S.C. § 2102(a). The district court concluded that the IMDA exhibited no Congressional intent to prohibitor to allowstate taxation, just as the Supreme Court found with the IMLA. R. at 225. Therefore, the district court concluded that the IMDA does not, at least in the first step of the Cotton Petroleum analysis, differ in any significant way from the IMLA. Id. at 221. On appeal, our review of the statutory language and legislative history of the IMDA does not suggest that a different conclusion is warranted. That is, we agree with the district court that nothing in the IMDA evidences a clear congressional intent to prohibitor to authorizethe taxation of agreements executed under that Act. The Tribe asserts that the IMDA was a step in the direction of tribal self-determination, freeing Indian tribes from the shackles of the anachronistic statutory authorizations of the past, which it asserts should weigh heavily in any Indian preemption analysis. Aplee. Br. at 25 n. 10. However, the Tribe fails to cite any relevant, persuasive statutory language or legislative history that evidences an express or implied congressional intent to prohibit state taxation of agreements executed under the IMDA. The only mention of taxation in the legislative history of the IMDA appears in the House Report, which states: In a statement submitted for the record, the governor of the State of Montana recommended an amendment[,] which would have had the effect of authorizing state taxation of the non-Indian portions of, or activity under, minerals agreement[s]. The committee declined to recommend the amendment. The Supreme Court, in recent years, has begun to illuminate this issue under existing law without difficulty.... If there was a need for congressional clarification of the law in this area, the committee determined that this was not the appropriate vehicle. H.R. Rep. 97-746, at 8-9 (1982), reprinted in 1982 U.S.C.C.A.N. 3465, 3470-71 (emphasis added). In other words, express authority for state taxation of non-Indian... activities under mineral leases executed pursuant to the IMDA was put on the table; however, the Committee refrained from including this in the Act, choosing instead to defer to the Supreme Court's evolving jurisprudence on the topic. This statement, if anything, evidences congressional neutrality on the issue of state taxation under the Act. It does not, on the other hand, evidence a clear congressional intent to prohibit taxation of activity carried out under the IMDA. Furthermore, when the IMDA was enacted in 1982, the doctrine of intergovernmental tax immunity had long been abolished, and it was well-established that non-Indian oil and gas lessees were subject to state taxation, absent clear disapproval by Congress. See Cotton Petroleum, 490 U.S. at 175-76, 179-80, 109 S.Ct. 1698 (stating that by 1938 oil and gas lessees operating on Indian reservations were subject to nondiscriminatory state taxation as long as Congress did not act affirmatively to preempt the state taxes); id. (stating that a lessee's oil production on Indian land is... not `automatically exempt from state taxation,' but Congress does, of course, retain the power to grant such immunity (quoting Mescalero Apache Tribe v. Jones, 411 U.S. 145, 150, 93 S.Ct. 1267, 36 L.Ed.2d 114 (1973))). Had Congress intended to absolutely prohibit (or absolutely permit) state taxation under the IMDA, we think it would have been more clear in expressing such intent. Thus, we conclude that the IMDA is silent regarding the issue of taxationthat is, like the IMLA, the IMDA neither expressly prohibits nor expressly authorizes state taxation. [23]