OLYMPIA, Wash. -- Governor Chris Gregoire and two Washington state tribes reached agreement recently on a settlement that would allow continued collection of the state gasoline tax on the tribes' reservations despite a recent U.S. District Court ruling that affirmed tribal sovereignty on the issue, the Associated Press said.
That agreement also requests that Judge Thomas Zilly reverse his November ruling, which opened the door for all tribes in the state to avoid the state's fuel tax.
It was important to us to settle this issue [image-nocss] once and for all, said Tom Fitzsimmons, the governor's chief of staff and lead negotiator in the case. All the parties feel that it's a fair, equitable, respectful settlement.
The agreement would send $250,000 and $550,000 in previously collected tax revenue back to the Swinomish and Squaxin Island tribes, respectively, and return 75% of gasoline taxes to those tribes in the future.
Zilly had ruled that the state cannot impose its gasoline tax on tribal retailers, because such action would infringe on tribal sovereignty.
The U.S. Supreme Court ruled in December that a Kansas gasoline tax, levied before the fuel reached the reservation, was permissible. In light of that ruling, state lawmakers, at the request of the governor, have proposed a bill that would rework state gasoline tax statutes to ensure that tribes can continue collecting the 31-cents-per-gallon state tax.
If all 15 tribes with gas stations had decided not to collect the tax, the state could have faced more than $5 million annually in revenue shortfalls, according to Washington Department of Transportation estimates. Such a move also would have allowed tribal stations to significantly undercut prices at nontribal stations.
The state returns about $3 million of gasoline tax revenue to the tribes each year through compacts. All state reservations have a gasoline tax return formula, based on average gallons consumed per year, number of enrolled tribal members and the rate of the gasoline tax.
The agreement is a good deal for both parties anytime the state and tribes can come together on agreements that are mutually satisfying, said Marty Loesch, attorney and head of intergovernmental affairs for the Swinomish tribe. It's in the best interest of the tribes and the people of the State of Washington.
In light of the Supreme Court ruling, State Senator Ken Jacobsen (D) proposed a bill (SB 6785) that changes the wording of tax statutes to impose the tax before the gasoline reaches tribal lands. Testimony on that measure was recently aired in front of the Senate Transportation committee.
The people of the state of Washington voted for us to have the gas tax to produce a number of projects across the state that could affect every community, every city, every country, every tribe, said State Sen. Mary Margaret Haugen (D), a sponsor of the bill. I think it's an issue to make sure we have the funds to move forward - that's what this is about.
By 2008, the state's gasoline tax will be 35 cents per gallon.
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