ST. PAUL (AP) — The Shakopee Mdewakanton Sioux tribe cannot put 593 acres of Twin Cities-area land into trust, a move that would have taken the land off tax rolls, the federal Bureau of Indian Affairs ruled Wednesday.
Larry Morrin, Minneapolis area director of the Bureau of Indian Affairs, said the tribe failed to demonstrate that “placing the land in trust is either necessary or essential to accomplishing its goals.”
The Mdewakanton plan to appeal, Chairman Stanley Crooks said in a written statement.
The wealthy tribe said it wanted to diversify its economy, possibly by building a shopping center and an industrial development. Its gambling operations earn each tribal member an estimated $600,000 a year.
“Because of our cultural values and our strong belief in tribal self-determination, the tribe requires the land to be under the tribe’s control,” Crooks said.
Gov. Arne Carlson lobbied the Interior Department against putting the Scott County land into trust. He contended it would hurt local governments because the land would have been exempt not only from taxes but from land-use planning or environmental laws.
The tribe determined that with a residential development, lost tax revenues would be about $33 million through the year 2010.
But Carlson’s office and the city of Shakopee believed the land would be used for a mix of residential, industrial and commercial developments. That would put lost tax revenue at nearly $98 million through the same period.
Carlson said the tribe already is “very, very wealthy” and that average families in the area should not pay higher taxes to subsidize tribal developments that go untaxed.
“The only way you can have lasting relationships is when you have a sense of equity,” he said.
Morrin said the tribe already had achieved “extraordinary” economic rehabilitation.
The Interior Department cannot approve an off-reservation casino if it would be detrimental to the local community, but there is no such restriction on tribal land acquisitions for other uses, and they are routinely granted.
“We hope this signals a policy change at the BIA so that local government interests will be meaningfully balanced against those of the tribe’s,” Carlson said.
He was confident the decision would hold up on appeal, saying “From where I come from, organizations speak with one voice.”
The appeal is likely to go to Kevin Gover, the Interior Department’s assistant secretary for Indian affairs.
Ron Allen, president of the National Congress of American Indians, said the ruling was an intrusive and premature one by the Minneapolis office.
He said the tribe has the support from “the rest of Indian country” in its push for a different ruling.
Sen. Rod Grams, R-Minn., called the agency’s decision a “return to fairness.” He recently got the Senate to approve legislation that would have blocked the BIA from approving the Shakopee request.
Tribal land acquisitions have become thorny political issues in a number of states as tribes with newfound casino gambling wealth have started buying up adjacent property.
Sen. Joe Lieberman, D-Conn. is pushing legislation that would bar tribes that are economically self-sufficient from putting real estate into trust with the government unless it is on their reservation or will be used for noncommercial purposes.
Many tribes, including the Shakopee, voluntarily make payments to local governments in lieu of taxes. The Shakopee tribe says it currently pays about $500,000 a year to Scott County and the city of Prior Lake to cover the cost of police, courts and other services.