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This is the fifth in a series of articles on doing business with Native American Tribes in Nevada.  These articles provide an overview of the political and business structures employed by Indian tribes, as well as the advantages and challenges of doing business in Indian Country.

Federal Approval of Certain Contracts

The federal government must approve certain contracts involving Indian tribes or their rights, including:

  • A purchase, grant, lease, or other conveyance of tribal lands, or of any title or claim thereto, from any tribe to a person or entity;[1]
  • Mineral leases and agreements;[2]
  • Tribal Energy Resource Agreements for mineral energy development;[3]
  • A contract with an Indian tribe that “encumbers Indian lands for a period of 7 or more years…;”[4]
  • Leases of the surface of land held in trust for or with restricted status by and Indian or Indian Tribe;[5] and
  • Contracts relating to gaming activities, which are also subject to tribal gaming ordinances.[6]

 

Indian Regulatory Environments

Many businesses find the regulatory environment on tribal land to be advantageous.  A few examples of the advantageous regulatory environment can be found in tribal product liability laws, labor laws, zoning, environmental laws, and unemployment.  As noted above, a tribe’s regulatory jurisdiction over non-Indians is limited to parties “who enter consensual relationships with the tribe . . . through commercial dealing, contract, leases, or other arrangements.”[7]  Tribes may also exercise regulatory jurisdiction over non-Indians when their activity “threatens or has some direct effect on the political integrity, the economic security, or the health and welfare of the tribe.”[8]

Several regulatory matters affecting business on tribal land are discussed below.

Environmental Regulations

As long as they comply with federal Environmental Protection Agency requirements, tribes can issue environmental permits and licenses regarding the use of tribal lands.

The Indian Gaming Regulatory Act of 1988 (“IGRA”)

Tribal gaming is regulated by The Indian Gaming Regulatory Act of 1988 (“IGRA”), as well as tribal laws, the Interior Department, the National Indian Gaming Commission, and well as the terms of various tribal-state gaming compacts.   IGRA limited the rights of tribes significantly by subjecting their activities to state government oversight in ways that were never before required of tribes.  Specifically, in order to engage in Class III (casino-style) gaming, a tribe must enter into a tribal-state gaming compact.  IGRA attempts to ensure that tribes are the sole owners and beneficiaries of on-reservation gaming activities.  It requires that tribal net gaming revenues be used to fund tribal government operations or programs, provide for the general welfare of the tribe and its members, promote tribal economic development, donate to charitable organizations, and fund operations of government agencies providing services to tribes.

Labor Laws

Tribes are not generally subject to state or federal employment laws and regulations.

Product Liability

Tribes are at liberty to structure caps on product liability in order to attract business development on tribal land.

Unemployment Regulations

Many tribes provide private unemployment and worker’s compensation insurance, allowing businesses to opt out of state-run systems.

Zoning and Improvements

Tribes are not generally subject to zoning, land-use, and permitting restrictions found outside tribal lands.  They are therefore often able to offer businesses more flexibility than might be found outside of tribal lands.  Further, since improvements on tribal trust lands are generally exempt from state taxation, businesses can reduce or eliminate real property taxes in some cases.

 

 


 

[1] 25 U.S.C. § 177.

[2] 25 U.S.C. § 396a; 25 U.S.C. § 2102(a).

[3] 25 U.S.C. § 3504; 25 C.F.R. § 224.

[4] 25 U.S.C. § 81.

[5] 25 U.S.C. § 415.

[6] 25 U.S.C. § 2710(b); 25 U.S.C. § 2710(d)(9); 25 C.F.R. § 553.

[7] Montana v. U.S., 450 U.S. 544 (1981); Plains Commerce Bank v. Long Family Land and Cattle Co., 554 U.S. 316 (2008); but see Nevada v. Hicks, 533 U.S. 353 (2001) (the court has “never held that a tribal court had jurisdiction over a nonmember defendant.”).

[8] Plains Commerce Bank v. Long Family Land and Cattle Co., 554 U.S. 316 (2008) (quoting Montana v. U.S., 450 U.S. 544 (1981)).

About the Author

Jay Young is a Las Vegas, Nevada attorney. His practice focuses on business law, business litigation, and acting as an Arbitrator and Mediator.

Mr. Young can be reached at 702.667.4868 or at jay@h2law.com.