Petition for Writ of Certiorari — Leonard Albrecht, et al., Petitioners v. Riverside County, California, et al.

NO. ______

In the

Supreme Court of the United States

________________

LEONARD ALBRECHT, et al.,

v.

Petitioners,

COUNTY OF RIVERSIDE, et al.,

________________

Respondents.

On Petition for a Writ of Certiorari to the

Court of Appeal of the State of California

________________

PETITION FOR A WRIT OF CERTIORARI

________________

Aaron D. Van Oort

Counsel of Record

Jerome A. Miranowski

Nicholas J. Nelson

Joshua T. Peterson

Thomas K. Pryor

FAEGRE DRINKER BIDDLE &

REATH LLP

2200 Wells Fargo Ctr.

90 South Seventh Street

Minneapolis, MN 55402

aaron.vanoort@faegredrinker.com

Counsel for Petitioners

QUESTIONS PRESENTED

Although this Court has made clear that federal

law preempts state and local governments from imposing real-property taxes on Indian lands, some of those

governments have levied those very taxes on the leasehold interest when the lands are leased to non-Indians. There is sharp disagreement among the lower

courts about whether those taxes are also preempted.

The Eleventh Circuit and the Department of the Interior have concluded that they are preempted—while

the Ninth Circuit and (in this case) the California

courts have found such taxes not preempted. In areas

where commercial development has extended to reservation lands, the Ninth Circuit and California position

deprives Indian tribes of a major part of their tax

base—crippling tribes’ ability to govern their own reservations.

The questions presented are:

1. Do the federal regulations governing the leasing

of Indian lands preempt state and local governments

from taxing the leasehold interest conveyed by the

regulated leases?

2. Does the express preemption provision of the

Indian Reorganization Act of 1934—which prohibits

state taxes on “any interest in lands” that the

government “acquire[s] pursuant to this Act … in trust

for [an] Indian tribe or individual Indian”—apply

when the government acquires extended trust rights

pursuant to the Act?

ii

PARTIES TO THE PROCEEDING

AND CORPORATE DISCLOSURE

Petitioners are approximately 500 individuals,

trusts, and business entities who were the plaintiffs in

two consolidated cases in the Superior Court of

California, and appellants in the Court of Appeal of

California. The lead plaintiff was Leonard Albrecht. A

full listing of the Petitioners is provided in the

Appendix at App.56 et seq.

There is no parent or publicly held company

owning 10% or more of the stock of any petitioner,

except for Petitioner MHC Date Palm, LLC. MHC

Date Palm, LLC’s sole member is MHC Operating

Limited Partnership. 94% of MHC Operating is owned

by its general partner, Equity LifeStyle Properties,

Inc., whose stock trades on the New York Stock

Exchange under ticker symbol ELS.

Respondent Riverside County, California was the

defendant in the Superior Court and a respondent in

the Court of Appeal.

Respondents Desert Water Agency and Coachella

Valley Water District were intervenor-defendants in

the Superior Court, and respondents in the Court of

Appeal.

iii

RELATED PROCEEDINGS

Albrecht v. County of Riverside, No. S270984 (Cal.),

review denied Dec. 22, 2021.

Albrecht v. County of Riverside, No. E073926 (Cal. Ct.

App.), opinion filed Aug. 13, 2021.

Albrecht v. County of Riverside, No. PSC 1501100 (Cal.

Super. Ct.), judgment entered Oct. 9, 2019.

Abbey v. County of Riverside, No. RIC 1719093 (Cal.

Super. Ct.), judgment entered Oct. 9, 2019.

iv

RULE 29.4(c) STATEMENT

28 U.S.C. § 2403(b) may apply and the Attorney

General for the State of California will be served.

v

TABLE OF CONTENTS

QUESTIONS PRESENTED........................................ i

PARTIES TO THE PROCEEDING AND

CORPORATE DISCLOSURE STATEMENT ............ ii

RELATED PROCEEDINGS ..................................... iii

RULE 29.4(c) STATEMENT ..................................... iv

TABLE OF AUTHORITIES .................................... viii

PETITION FOR A WRIT OF CERTIORARI..............1

OPINIONS BELOW ....................................................3

JURISDICTION ..........................................................3

STATUTORY PROVISIONS.......................................3

STATEMENT OF THE CASE ....................................4

A. State And Local Property Taxes On

Leased Indian Lands Put Tribes To A

Cruel Choice Between Economic Development And Sovereignty ...................................4

B. The Law Is In Disarray Over Whether

State And Local Taxes On Leases Of Indian Lands Are Preempted ...........................7

C. Here, The California Courts Entrenched

Themselves On One Side Of The Split .......11

1.

The Agua Caliente Tribe’s Efforts to

Tax Reservation Lands are Crowded

out by Riverside County’s Property

Taxes.....................................................11

2.

The California Courts Reject Plaintiffs’ Preemption Claims ......................14

REASONS FOR GRANTING THE WRIT ................16

vi

I.

The Lower Courts Are Intractably Split On

The Preemptive Force Of Federal IndianLands Leasing Regulations ................................17

II. This Court Has Yet To Clarify The

Boundaries Of Statutory Express Preemption

Of Taxes On Trust Lands ...................................23

III. The Court Should Grant Review To Resolve

The Split .............................................................26

CONCLUSION .......................................................... 26

APPENDIX

Appendix A Order in the Supreme Court of California (December 22, 2021) ................ App.1

Appendix B Opinion in the Court of Appeal of the

State of California, Fourth Appellate

District, Division Two

(August 13, 2021) ........................... App.3

Appendix C Order in the Court of Appeal of the

State of California, Fourth Appellate

District, Division Two

(September 9, 2021) ..................... App.27

Appendix D Tentative Decision on First Bifurcated

Issue in the Superior Court of the State

of California, County of Riverside

(April 24, 2019)............................. App.29

Appendix E Statement of Decision in the Superior

Court of the State of California, County

of Riverside

(September 27, 2019) ................... App.43

vii

Appendix F Judgment on Decisions of the Court in

the Superior Court of the State of California, County of Riverside

(October 9, 2019) .......................... App.51

Appendix G List of Plaintiff Names ................. App.56

Plaintiffs in Albrecht v. Riverside

County, PSC 1501100................... App.56

Plaintiffs in Abbey v. Riverside County,

RIC 1719093 ................................. App.61

viii

TABLE OF AUTHORITIES

Cases

Agua Caliente Band of Mission Indians v.

Riverside County, 442 F.2d 1184 (9th Cir. 1971)

............................................................................... 8

Agua Caliente Band of Cahuilla Indians v. Riverside

County, 181 F.Supp.3d 725 (C.D. Cal. 2016) ..... 10

Agua Caliente Band of Cahuilla Indians v.

Riverside County, 2017 WL 4533698

(C.D. Cal. June 15, 2017) ................................... 22

Agua Caliente Band of Cahuilla Indians v.

Riverside County,

749 F.App’x 650 (9th Cir. 2019) ................... 10, 20

Fort Mojave Tribe v. San Bernardino County,

543 F.2d 1253 (9th Cir. 1976) .............................. 8

Herpel v. County of Riverside,

45 Cal.App.5th 96 (2020)............................ passim

Kerr-McGee Corp. v. Navajo Tribe,

471 U.S. 195 (1985) .............................................. 5

Merrion v. Jicarilla Apache Tribe,

455 U.S. 130 (1982) .............................................. 5

Mescalero Apache Tribe v. Jones,

411 U.S. 145 (1973) .................................... passim

Michigan v. Bay Mills Indian Community,

572 U.S. 782 (2014) .......................................... 6, 7

Montana v. Blackfeet Tribe,

471 U.S. 759 (1985) .............................................. 5

New Mexico v. Mescalero Apache Tribe,

462 U.S. 324 (1983) ...................................... 17, 18

ix

Palm Springs Spa, Inc. v. County of Riverside,

18 Cal.App.3d 372 (1971) ..................................... 8

Pickerel Lake Outlet Ass’n v. Day County,

953 N.W.2d 82 (S.D. 2020) ........................... 24, 25

Ramah Navajo School Board v. Bureau of Revenue of

New Mexico, 458 U.S. 832 (1982) ....................... 17

Rogers County Board of Tax Roll Corrections v. Video

Gaming Technologies, Inc., 141 S. Ct. 24 (2020)

............................................................................. 16

Segundo v. City of Rancho Mirage,

813 F.2d 1387 (9th Cir. 1987.) ..................... 20, 21

Seminole Tribe of Florida v. Stranburg,

799 F.3d 1324 (11th Cir. 2015) .................. passim

Sifferman v. Chelan County,

496 P.3d 329 (Wash. Ct. App. 2021) .................. 25

Wagnon v. Prairie Band Potawatomi Nation,

546 U.S. 95 (2005) .............................................. 17

Washington v. Confederated Tribes of Colville

Indian Reservation, 447 U.S. 134 (1980) ............. 8

White Mountain Apache Tribe v. Bracker,

448 U.S. 136 (1980) .................................... passim

Yankton Sioux Tribe v. Podhrasky,

606 F.3d 994 (8th Cir. 2010) .............................. 25

Statutes

25 U.S.C. §§ 415-415d ............................................... 18

25 U.S.C. § 415 ................................................ 6, 18, 19

25 U.S.C. § 5102 ........................................................ 11

25 U.S.C. § 5108 ................................................ passim

x

28 U.S.C. § 1257(a) ...................................................... 3

Mission Indian Relief Act, 26 Stat. 712 (1891)......... 11

Act of March 2, 1917, 39 Stat. 969, § 3 (1917) .......... 11

Cal. Rev. & Tax C. §§ 103-104 .................................. 13

Regulations

25 C.F.R. ch.1, App’x ................................................. 11

25 C.F.R. Pt. 162........................................................ 18

25 C.F.R. § 162.001.................................................... 19

25 C.F.R. § 162.014.................................................... 19

25 C.F.R. § 162.017................................................ 9, 19

25 C.F.R. § 162.022.................................................... 19

25 C.F.R. § 162.027.................................................... 19

25 C.F.R. § 162.234.................................................... 19

25 C.F.R. § 162.311.................................................... 19

25 C.F.R. § 162.313.................................................... 19

25 C.F.R. § 162.316.................................................... 19

25 C.F.R. § 162.321.................................................... 19

25 C.F.R. § 162.323.................................................... 19

25 C.F.R. §§ 162.345-352 ........................................... 19

25 C.F.R. § 162.364.................................................... 19

25 C.F.R. § 162.367.................................................... 19

Residential, Business, and Wind and Solar Resource

Leases on Indian Land, 77 Fed. Reg. 72,440-01

(Dec. 5, 2012). ................................................. 9, 20

xi

Other Authorities

Cohen’s Handbook of Federal Indian Law ............... 18

Croman & Taylor, Why Beggar Thy Indian

Neighbor? The Case for Tribal Primacy in

Taxation in Indian Country, Harvard Project

on American Indian Economic Development

and University of Arizona Native Nations

Institute Joint Occasional Papers on Native

Affairs, No. 2016-1 (Discussion Draft May

2016).................................................................. 4, 5

Pomp, The Unfulfilled Promise of the Indian

Commerce Clause and State Taxation, 63 Tax

Law. 897 (2010) .................................................. 24

Saunders, Note, Tribal Taxation and Allottted Lands:

Mustang Production Co. v. Harrison, 27

N.M.L.Rev. 455 (1997).......................................... 5

U.S. Code Editorial Reclassification Table............... 23

PETITION FOR A WRIT OF CERTIORARI

When non-Indians lease Indian lands, the law is

in disarray as to whether federal law preempts state

and local governments from collecting property taxes

from the lessees. This Court has held that states may

not tax Indian lands without congressional

authorization but sometimes may tax non-Indians’

commercial activities on reservation lands. The Court

has not addressed, however, whether states may tax

Indian land leased to a non-Indian, when the taxes are

collected from the non-Indian lessee. The void in this

Court’s cases has led to an entrenched split on the

question between federal courts, state courts, and the

Department of the Interior. In this case, the California

courts acknowledged the split and reasserted their

conflicting position.

This split in the law matters, both practically and

doctrinally. As a practical matter, Indian tribes on one

side of the split enjoy federal protection of the tax base

needed to exercise their sovereignty through effective

local government. On the other side of the split, the

Indian taxing authority is left unprotected against

state and local governments, who crowd it out by

imposing their own property taxes on Indian lands

leased to non-Indians. The consequence is that, on one

side of the split, land development entering a

reservation strengthens tribal sovereignty by

increasing the value of the tribe’s property-tax base

and enabling more effective tribal government. But on

the other side of the split, such development is just

another way that tribal sovereignty is undermined

because the state and local governments will take the

increased value for themselves.

2

The doctrinal split is just as significant and

involves two basic questions of law that this Court has

not answered. First, this Court has not addressed

whether, and to what extent, the extensive federal

regulation of the leasing of Indian land preempts state

and local regulation of the lease terms and taxation of

the leased land. The resulting void has led to lower

courts and the Department of the Interior taking at

least three different positions, the most extreme of

which was reasserted by the California courts in this

case.

Second, this Court has never addressed what

“interest in lands” must be acquired in order to trigger

express federal preemption under 25 U.S.C. § 5108.

Section 5108 codifies the Indian Reorganization Act of

1934, as amended, and exempts from state or local

taxation “any interest in lands” that is “acquired

pursuant to this Act or the Act of July 28, 1955.” This

Court held in Mescalero Apache Tribe v. Jones, 411

U.S. 145, 155 n.11 (1973), that the terms “any

interest” and “acquired” should be construed not

“technically” but pragmatically, and that they extend

beyond circumstances where the government

purchases a fee interest expressly for the benefit of an

Indian tribe. But this Court has not addressed

whether the acquisition of expanded trust rights—of

the kind Petitioners relied on here—falls within the

“any interest” covered by the statute.

This is the case in which to answer both important

questions—about the preemptive force of the federal

leasing regulations, and about what kind of “interest

in lands” qualifies for § 5108 preemption. The

California courts are now firmly entrenched on one

3

side of an acknowledged split of authority. The

questions are squarely presented by this case and are

important to the exercise of sovereignty by Indian

tribes. The Court should grant the writ, find the taxes

preempted, and reverse.

OPINIONS BELOW

The order of the Supreme Court of California

denying review is reproduced in the Appendix at

App.1. The opinion of the Court of Appeal of California

is reported at 68 Cal.App. 5th 692 and 283 Cal.Rptr.3d

716, and is reproduced in the Appendix at App.3. The

Court of Appeal’s order that the opinion be published

is reproduced in the Appendix at App.27. The

Statements of Decision and Judgment of the Superior

Court of California are not reported, but are

reproduced in the Appendix at App.29, App.43, and

App.51, respectively.

JURISDICTION

The Supreme Court of California entered its order

denying review on December 22, 2021. This Court has

jurisdiction pursuant to 28 U.S.C. § 1257(a).

STATUTORY PROVISIONS

The Indian Reorganization Act of 1934, as

amended, provides in relevant part:

4

The Secretary of the Interior is authorized, in his

discretion,

to

acquire,

through

purchase,

relinquishment, gift, exchange, or assignment, any

interest in lands, water rights, or surface rights to

lands, within or without existing reservations,

including trust or otherwise restricted allotments,

whether the allottee be living or deceased, for the

purpose of providing land for Indians.

****

Title to any lands or rights acquired pursuant to

this Act or the Act of July 28, 1955, as amended, shall

be taken in the name of the United States in trust for

the Indian tribe or individual Indian for which the

land is acquired, and such lands or rights shall be

exempt from State and local taxation.

25 U.S.C. § 5108 (citations omitted).

STATEMENT OF THE CASE

A. State And Local Property Taxes On Leased

Indian Lands Put Tribes To A Cruel

Choice Between Economic Development

And Sovereignty.

On Indian reservations, tribal governments can

“have responsibilities resembling those of county and

municipal governments.” 1 In most parts of our

1 Croman & Taylor, Why Beggar Thy Indian Neighbor? The

Case for Tribal Primacy in Taxation in Indian Country, at 4,

Harvard Project on American Indian Economic Development and

University of Arizona Native Nations Institute Joint Occasional

Papers on Native Affairs, No. 2016-1 (Discussion Draft May

5

country, local governments fund their responsibilities

in significant part by levying real-property taxes.

Tribal governments have the same right to tax land

within their jurisdiction: “The power to tax is an essential attribute of Indian sovereignty” because it “enables a tribal government to raise revenues for its

essential services.” Merrion v. Jicarilla Apache Tribe,

455 U.S. 130, 137 (1982); see Kerr-McGee Corp. v. Navajo Tribe, 471 U.S. 195, 201 (1985) (tribes “can gain

independence from the Federal Government only by

financing their own police force, schools, and social

programs”). Moreover, this Court has long since held

that, generally speaking, state and local governments

may not “tax[] Indian reservation lands … absent congressional consent.” Mescalero Apache Tribe, 411 U.S.

at 148. Federal law preempts such taxes as “an unwarrantable interference, inconsistent with the original

title of the Indians, and offensive to their tribal relations.” Montana v. Blackfeet Tribe, 471 U.S. 759, 764765 (1985) (citation omitted).

Still, whether a tribe really can finance its government operations through property taxes depends on

the property value and on whether state and local government taxation can crowd the tribe out. Until 1934,

federal policy was “to terminate tribal governments

and extinguish tribal territories by dismantling the

tribal land base.” 2 This left tribal lands consisting of

2016),

http://nni.arizona.edu/application/files/8914/6254/9090/2016_Cr

oman_why_beggar_thy_Indian_neighbor.pdf

2 Saunders, Note, Tribal Taxation and Allottted Lands:

Mustang Production Co. v. Harrison, 27 N.M.L.Rev. 455, 460

(1997).

6

remote, scattered parcels that had little value left to

be taxed. The federal Indian Reorganization Act of

1934 finally “put a halt to the loss of tribal lands,”

Mescalero Apache Tribe, 411 U.S. at 151 (cleaned up),

and authorized the government to acquire lands to be

held in trust for Indians. See 25 U.S.C. § 5108. But

even then, the lands within most tribes’ jurisdictions

remained few, low in value, or held in trust by the federal government—leaving the tribes “largely unable to

obtain substantial revenue” through property taxes.

Michigan v. Bay Mills Indian Cmty., 572 U.S. 782, 812

(2014) (Sotomayor, J., concurring).

For some tribes, the passing decades brought the

prospect of change. The expansion of American cities

led to some reservation lands becoming less remote, as

economic development approached their boundaries.

When they can, tribes and their members have responded by developing their own properties—but the

simplest way to unlock these increasing property values often is by leasing lands within tribal jurisdiction

to those who wish to develop them. This can be done

even for lands held in trust by the federal government,

as long as the lease agreement satisfies the conditions

prescribed by the Secretary of the Interior. See 25

U.S.C. § 415. This creates the prospect for tribal governments to generate property-tax revenues by taxing

the leaseholds. That will allow the tribe to exercise

practical sovereignty over its lands by increasing regulation and services commensurate with the level of

development. And if the tribe cannot provide those

services or does not wish to, it can sign an inter-governmental agreement with the local city or county government to provide them in exchange for payments

from the tribe.

7

But there is a complication: state and local governments oftentimes try to take the tax revenue for themselves. Once such lands become commercially

interesting to non-Indians, some state and local governments argue that they can force the lessees to pay

exactly the same amount of tax that the Indian landowners would if they were not exempt. When these

claims succeed, they can form “insuperable … barriers” to the tribe’s own taxation. Bay Mills Indian

Cmty., 572 U.S. at 810 (Sotomayor, J., concurring).

Although the tribes retain the theoretical ability “to

impose their own taxes on these same sources,” the result would be a combined tax burden greater than that

imposed on non-Indian parcels of land—and “[a]s commentators have observed, … the resulting double taxation would discourage economic growth”, causing the

land’s value to lessees to erode or even evaporate. Id.

at 811 (collecting citations).

The result is to put the tribe to a cruel choice between economic development and sovereignty. A

tribe’s members can benefit from the increasing value

of their once-remote lands only if the tribe is willing to

sacrifice its sovereign right to tax those lands. And if

the tribe does that, its ability to provide services to the

newly-developed area will be correspondingly limited—leaving the local government likely to fill the

gap.

B. The Law Is In Disarray Over Whether

State And Local Taxes On Leases Of

Indian Lands Are Preempted.

As noted, this Court has established that state and

local governments usually may not “tax[] Indian

8

reservation lands … absent congressional consent,”

Mescalero Apache Tribe, 411 U.S. at 148. On the other

hand, this Court’s precedents give state and local governments more latitude to impose sales taxes (or similar taxes) on non-Indians who do business on

reservations. See Washington v. Confederated Tribes

of Colville Indian Rsrv., 447 U.S. 134, 151–159 (1980).

This case presents the intermediate question: may

state and local governments tax Indian land when it

is leased to non-Indians and the tax is collected from

the non-Indian lessees?

Over time, federal courts, state courts, and the Department of the Interior have reached a state of intractable disagreement on that question.

The Ninth Circuit and the California courts decided the issue first, in decisions a few months apart

in 1971, considering separate preemption challenges

to the same California county tax that is at issue in

this case. The Ninth Circuit upheld against preemption challenge a tax on “the full cash value of the lessee’s interest in” Indian lands. Agua Caliente Band of

Mission Indians v. Riverside Cnty., 442 F.2d 1184,

1186 (9th Cir. 1971) (citation omitted). Similarly, the

California Court of Appeal concluded that a “state …

tax imposed on the leasehold interest carved from the

tax exempt … fee is sufficiently indirect and remote as

to be permissible” under federal law. Palm Springs

Spa, Inc. v. Cnty. of Riverside, 18 Cal.App.3d 372, 375

(1971). The Ninth Circuit reiterated its holding in another similar decision a few years later. Fort Mojave

Tribe v. San Bernardino Cnty., 543 F.2d 1253, 1256

(9th Cir. 1976).

9

Later, however, the Department of the Interior

and the Eleventh Circuit disagreed. In 2012, Interior

published a lengthy analysis concluding that “[t]he

Federal statutes and regulations governing leasing on

Indian lands … preempt the field of Indian leasing.”

Residential, Business, and Wind and Solar Resource

Leases on Indian Land, 77 Fed. Reg. 72,440-01, at

72,447 (Dec. 5, 2012). It therefore amended its Indianlands-leasing regulations to mandate that, when

Indian land is leased, “the leasehold or possessory

interest is not subject to any fee, tax, assessment, levy,

or other charge imposed by any State or political

subdivision of a State.” 25 C.F.R. § 162.017(c)

(emphasis added).

In 2015, the Eleventh Circuit took the same view,

holding that Florida is preempted from “tax[ing]

commercial rent payments” for Indian lands—even

though, like the California county exaction, “[t]he

tax … constitutes a lien on the personal property of

the lessee, and not … the land or property of the

[Indian] lessor.” Seminole Tribe of Florida v.

Stranburg, 799 F.3d 1324, 1326 (11th Cir. 2015). The

Eleventh Circuit stated that the Secretary’s finding of

preemption “deserves some weight” short of formal

deference, but ultimately found the tax preempted

after an “independent … inquiry.” Id. at 1338-39. The

Eleventh Circuit also concluded that, to the extent the

Ninth Circuit had taken a different approach, its

rationale had been “obliterat[ed]” by later decisions

from this Court. Id. at 1334.

After Interior issued its analysis and the Eleventh

Circuit released its decision, the Ninth Circuit and the

California courts have acknowledged the split but

10

reaffirmed their commitment to allowing state and

local governments to tax. In 2019, the Ninth Circuit

adhered to its previous view, albeit with some

reluctance. In another challenge to the county tax at

issue in this case, the Central District of California

noted the tax’s “direct conflict” with the Department

of the Interior’s regulation, as well as the conflict

between the Ninth and Eleventh Circuits—but it

stated that “[d]istrict courts are not to resolve splits

between circuits no matter how egregiously in error

they may feel their own circuit to be.” Agua Caliente

Band of Cahuilla Indians v. Riverside Cnty., 181

F.Supp.3d 725, 740-741 (C.D. Cal. 2016) (cleaned up).

On appeal, the Ninth Circuit admitted that “there may

be some tension between” its earlier decisions and this

Court’s intervening rulings, but concluded that they

“are not clearly irreconcilable” and so the court of

appeals’ earlier decisions remained binding. Id., 749

F.App’x 650, 651-652 (9th Cir. 2019).

In 2020, the California Court of Appeal likewise

adhered to its view that federal law does not protect

leased Indian land against state and local taxation. In

Herpel v. County of Riverside, the Court of Appeal

concluded that the “federal interest in” the Indianlands “Leasing Regulations” is not strong enough to

have preemptive effect. 45 Cal.App.5th 96, 111 (2020).

The court “note[d] that this puts us in disagreement

with” the Eleventh Circuit’s Seminole Tribe decision,

among others. Ibid. Regarding the state interest in the

tax, the court purported to find Seminole Tribe

“distinguishable” as involving “taxes on business

activity only,” while noting that the California tax also

extended to “leases … for residential purposes.” Id. at

115-116. The court also found the Department of the

11

Interior’s views to be “incomplete, and so … not

reasonable enough to warrant deference.” Id. at 118.

C. Here, The California Courts Entrenched

Themselves On One Side Of The Split.

In this case, the California Court of Appeal yet again

reaffirmed its position and upheld local property taxes

on Indian-lands lessees, and the California Supreme

Court denied review.

1.

The Agua Caliente Tribe’s Efforts to

Tax Reservation Lands are Crowded

out by Riverside County’s Property

Taxes.

The Agua Caliente Reservation was established in

1876. (Cal. Ct. App. Appellants’ App’x 246.) After being significantly reduced and fragmented in the first

60 years of its existence, the reservation now covers

roughly 31,000 acres to the east of Los Angeles, scattered across the resort town of Palm Springs, California, and neighboring communities. App.7. These lands

are “held in trust” by the United States “for the benefit

of the tribe” or “one or more members of the tribe.”

App.7-8. By law, the United States’ trust rights were

set to expire in 1994. 3 In 1990, however, Congress

amended the Indian Reorganization Act to provide

that all the government’s then-existing trust rights

over Indian lands “are extended and continued until

otherwise directed by Congress.” 25 U.S.C. § 5102.

3 See Mission Indian Relief Act §§ 3, 5, 26 Stat. 712-713 (1891)

(limiting the trust to 25 years); Act of March 2, 1917, § 3 39 Stat.

969, 976(1917) (authorizing the President to extend the trust

period); 25 C.F.R. ch.1, App’x (listing trust period extensions).

12

The Agua Caliente tribal government provides extensive regulation and services with respect to the

lands under its jurisdiction. The tribal council has enacted and enforces a land-use ordinance, a building

and safety code, and an environmental policy act. (Cal.

Ct. App. Appellants’ App’x 253, 480-510, 752-894.) On

parts of the reservation, the tribal government also

maintains roads and provides flood-protection services. (Id. at 248-49.)

The Agua Caliente’s lands are their most valuable

resource. To monetize that value, the Secretary of the

Interior has approved the Tribe and its members to

lease more than 4000 acres of trust lands to non-Indians under some 20,000 lease agreements that are subject to extensive federal regulation. (Cal. Ct. App.

Appellants’ App. 247, 734-747.)4

Since 1967, the Agua Caliente tribal government

has sought to fund its activities, in part, through a 1%

tax on real-property leases within the Reservation.

(Id. at 504-506, 895-899.) But those efforts have so far

failed because lessees of these Indian lands have instead been forced to pay property taxes to non-tribal

governments.

The reservation lands at issue are located within

the boundaries of respondent Riverside County—

which, like many counties throughout the United

4 The judgment below also expressly applies to lands on the Colorado River Indian Reservation, which lies further east of the

Agua Caliente Reservation, along the California-Arizona border

and near the route from Los Angeles to Phoenix. (Cal. Ct. App.

Appellants’ App’x at 255-256.) The Colorado River Indian Tribe

and its members also lease trust lands to numerous non-Indians.

(Id. at 255, 464.)

13

States, funds much of its operations through real-estate taxes. Stretching from the outskirts of Los Angeles to the Arizona border, Riverside County is one of

the most populous in the nation, and its total annual

real-estate tax revenues exceed $2.5 billion. (Id. at

233, 253.) A large portion of these taxes is collected

from the fee simple owners of land. But California law

defines taxable “real property” more broadly as including “[t]he possession of, claim to, ownership of, or right

to the possession of land,” Cal. Rev. & Tax C.

§ 104(a)—and so, when the fee interest in land is tax

exempt but the land has been leased, the County levies exactly the same property tax against the lessee.

(Id. at 720-722.)

That is what happened here. The County recognizes that it cannot tax reservation lands directly, so

it demands that non-Indian lessees of the lands pay

the taxes. The taxes are not tied to services to the specific leased parcels or even to reservation lands as a

class. Instead, the taxes include a 1% “general revenue

tax” for “funding … government agencies within the

county,” App.9, plus water-district and school-district

taxes that total approximately 0.2%. App.9-10; see Cal.

Ct. App. Appellants’ App’x at 244-245, 268-269, 453.

The result is that, if the Agua Caliente government

were to enforce its own 1% property tax, Indian lands

leased to non-Indians would be subject to roughly

twice the tax burden of non-Indian lands located in the

same communities. “[T]o avoid double taxation,”

therefore, the tribe has been forced to hold its property

tax in abeyance, and has not sought to collect it. (Cal.

Ct. App. Appellants’ App’x at 250, 252, 505; see

App.10.) Many hundreds of lessees thus have been

14

required to pay property taxes to Riverside County,

rather than to the tribe.

2.

The

California

courts

reject

plaintiffs’ preemption claims.

The plaintiffs and petitioners in this case are

approximately 500 non-Indian lessees of lands within

the Agua Caliente or Colorado River reservations, who

paid property taxes on those leases to Riverside

County. (Cal. Ct. App. Appellants’ App’x 246, 255; see

App.6-7.) They filed two lawsuits against the County

in California state court, seeking tax refunds. App.67. The great majority of refund claims range from

around $1000 up to $20,000; some are for up to

$400,000, and one is for about $1.5 million. (See

Compls., Cal Ct. App. Appellants’ App’x at 42-67, 89.)

As relevant here, Petitioners’ claims are that the

county’s taxes are preempted as to their leases by both

(1) the pervasive federal regulatory scheme covering

leases of Indian lands, and (2) 25 U.S.C. § 5108’s

express preemption of state taxes on Indian trust

lands that were “acquired pursuant to” the Indian

Reorganization Act.

Aside from the County, the other Respondents are

two water districts who benefit from the property

taxes at issue, and who intervened as defendants in

the trial court. After consolidating the cases, the

Superior Court entered judgment “primarily [on]

stipulated facts,” App.7, upholding the validity of the

15

taxes. See App.29-42 (tentative decision), App.43-50

(final decision). 5

The Court of Appeal of California affirmed.

Regarding

the

federal

Indian-lands-leasing

regulations, the court reiterated its conclusion from

Herpel that the regulations lack preemptive force.

App.19-20. The Court of Appeal also restated its

“disagreement with courts that have determined

otherwise,” including the Eleventh Circuit in Seminole

Tribe. App.20 n.6.

The Court of Appeal also rejected Petitioners’

argument that the tax is expressly preempted by 25

U.S.C. § 5108, which provides that “any lands or

rights … acquired” by the Secretary of the Interior in

trust for Indians “pursuant to this Act … shall be

exempt from State and local taxation.” The court held

that the “tribal land at issue in this case” is not

protected by § 5108 because it “was [originally] set

aside for the Agua Caliente and CRIT decades prior to

the enactment of the IRA.” App.13. Although the trust

rights were set to expire until Congress amended the

IRA to extend them in 1990, the Court of Appeal held

that the extended trust rights did not qualify as

Before reaching the merits, the Superior Court held that

Petitioners have standing to seek tax refunds. The Court noted

that striking down the challenged taxes might make little

practical difference to Petitioners in future years if it led the

tribes to collect their own similar taxes—but even if that were the

case, Petitioners would still be entitled to keep their refunds of

taxes paid in past years and so have standing to seek that relief.

App.31-35. The Court of Appeal saw no need to revisit this

question.

5

16

“rights … acquired pursuant to” the IRA within the

meaning of the statute. App.14-18.

After the Court of Appeal issued its opinion, the

defendants requested that the opinion be published

because it “decides issues of continuing public

interest” that “have arisen in numerous cases and are

of a recurring nature,” and that still are not “fully

settled.” (Defs’. Ltr. to Ct. App. at 7-8, Sept. 1, 2021.)

The Court of Appeal granted the request and ordered

the opinion published. App.27-28.

The California Supreme Court denied review,

App.1-2, and this Petition follows.

REASONS FOR GRANTING THE WRIT

This case is an especially clear illustration of the

“tension among courts about how to apply pre-emption

principles at the intersection of federal law, state law,

and tribal land.” Rogers Cty. Bd. of Tax Roll Corr. v.

Video Gaming Techs., Inc., 141 S. Ct. 24, 25 (2020)

(Thomas, J., dissenting from denial of certiorari).

Moreover, it is an excellent vehicle to address that

confusion on two important issues. First, does the

comprehensive federal regulation of the leasing of

Indian land preempt state and local governments from

taxing the leased land and collecting the tax from the

non-Indian lessees under the balancing analysis

announced by this Court in White Mountain Apache

Tribe v. Bracker? Second, for purposes of express tax

preemption under 25 U.S.C. § 5108, are expanded

trust rights an “interest in lands” whose acquisition

“pursuant to [the Indian Reorganization] Act” brings

the land within the plain language of the statute?

17

I.

The Lower Courts are Intractably Split On

The Preemptive Force Of Federal IndianLands Leasing Regulations.

This Court’s precedents have “emphasized the special sense in which the doctrine of preemption is applied in th[e] context” of “State laws affecting Indian

tribes.” New Mexico v. Mescalero Apache Tribe, 462

U.S. 324, 333-334 (1983). The analysis is “not

limit[ed]” to “familiar principles of preemption.” Id. at

334. In White Mountain Apache Tribe v. Bracker, this

Court set forth a balancing preemption analysis for

use “where … a State asserts authority over the conduct of non-Indians engaging in activity on the reservation.” 448 U.S. 136, 144 (1980). In such cases, the

courts must conduct “a particularized inquiry into the

nature of the state, federal, and tribal interests at

stake,” by “examin[ing] the language of the relevant

federal treaties and statutes in terms of both the broad

policies that underlie them and the notions of sovereignty that have developed from historical traditions

of tribal independence.” Id. at 144-145. Under

Bracker, if the “federal regulatory scheme” is sufficiently “pervasive” and “comprehensive,” then state

taxes are preempted unless they can be “justif[ied] by

an even more weighty “regulatory function or service

performed by the State.” Id. at 148-149. This Court’s

later precedents have applied what has become known

as “the Bracker interest-balancing test.” Wagnon v.

Prairie Band Potawatomi Nation, 546 U.S. 95, 99

(2005) (finding Bracker does not apply to taxes on “a

transaction that occurs off the reservation”); see, e.g.,

Ramah Navajo Sch. Bd. v. Bureau of Revenue of New

Mexico, 458 U.S. 832, 845 (1982) (“comprehensive federal scheme regulating the creation and maintenance

18

of educational opportunities for Indian children” precluded state tax on commercial activity that was justified by “nothing more than a general desire to increase

revenues”); Mescalero, 462 U.S. at 338-342 (“comprehensive scheme of federal and tribal management established pursuant to federal law” preempted state

regulation of hunting and fishing).

With respect to state taxation of Indian-lands

leaseholds, the split amongst the lower courts and the

Department of the Interior is, first and foremost, a disagreement about the Bracker preemption analysis.

The lower courts agree that federal law regulates

the leasing of Indian trust lands in great detail. From

the Founding era to the present day, Congress has

passed more than a dozen statutes concerned specifically with leasing Indian lands. See Cohen’s Handbook

of Federal Indian Law §§ 1.03-06, 5.02-03, 15.06-07,

17.02-04. Congress enacted most of the modern regulatory regime in 1955. See 25 U.S.C. §§ 415-415d. This

statutory scheme requires the approval of the Secretary of the Interior for such leases and authorizes the

Secretary to prescribe their terms and regulations. Id.

§ 415(a). Exercising that authority, the Secretary has

promulgated regulations of Indian land leases running to several hundred numbered sections. See 25

C.F.R. Pt. 162. Among many other things, the regulations prescribe (1) what laws apply to leases of Indian

lands; (2) what taxes apply; (3) how leases may be enforced; (4) what documents must be submitted to the

BIA for approval, administration, or enforcement of

leases; (5) maximum length; (6) mandatory terms;

(7) the amount of rent; (8) how a lease must be recorded; and (9) whether and how a lease can be

19

amended or assigned. 6 The United States also has extraordinary, ongoing control over the performance and

terms of Indian-land leases: the regulations authorize

federal regulators to enter leased premises upon reasonable notice, to monitor and enforce the terms of the

lease, to cancel the lease, and even to collect lease payments. 25 C.F.R. §§ 162.316, 162.364, 162.367. The

statutes also authorize the Secretary to approve tribes

to themselves administer certain leases, 25 U.S.C.

§ 415(h), which the Secretary has done for the Agua

Caliente. (Cal. Ct. App. Appellants’ App’x at 733-750.)

Although these regulations are comprehensive in

nature, the lower courts disagree about what, if any,

preemptive force they have.

Start with the Eleventh Circuit’s Seminole Tribe

decision. There, the court found a leasehold tax on Indian lands preempted under “the Bracker analysis,”

because “the extensive and exclusive federal regulation of Indian leasing … precludes the imposition of

state taxes on that activity,” and because the purpose

of the tax was “raising revenue for providing statewide

services generally” rather than “to compensate for any

state services … related to the act of renting of commercial property on Indian land.” 799 F.3d at 1339.

The Department of the Interior agrees. Its regulatory discussion of preemption expressly follows the

Bracker analysis, concluding that “[t]he Federal statutory [and regulatory] scheme for Indian leasing is

comprehensive, and accordingly precludes State taxation” because “[f]ederal regulations cover all aspects of

6 Id. §§ 162.001, 162.014, 162.017, 162.022, 162.027, 162.311,

162.313, 162.321, 162.323, 162.345-352.

20

leasing.” Residential, Business, and Wind and Solar

Resource Leases on Indian Land, 77 Fed. Reg. at

72,447.

The Ninth Circuit and the California courts have

reached a contrary conclusion under Bracker—but for

conflicting reasons. The Ninth Circuit’s initial decisions upholding California county leasehold taxes

came “years before Bracker.” Agua Caliente Band, 749

F.App’x at 651. After Bracker, the Ninth Circuit held

in a non-tax case that “the federal statutes authorizing the leasing of trust lands and the regulations governing such leasing … constitute a comprehensive

regulatory scheme with preemptive effect on state and

local laws,” and so found a rent-control ordinance

preempted as to leases of Indian lands. Segundo v.

City of Rancho Mirage, 813 F.2d 1387, 1392 (9th Cir.

1987.) When the Agua Caliente tribe challenged the

leasehold tax under Bracker, however, the Ninth Circuit declined to engage in a fresh Bracker analysis and

instead held that its pre-Bracker decisions upholding

the leasehold tax remain binding. Agua Caliente

Band, 749 F.App’x at 651-652. Although the panel

noted “some tension between” these decisions “and the

balancing inquiry required under Bracker,” it applied

them anyway because it found them “not clearly irreconcilable with Bracker.” Ibid. The full Ninth Circuit

then denied rehearing en banc (with no judge requesting a vote). Id., Order of Mar. 6, 2019 (C.A.9 No. 1756003, ECF #67.) The result is that Ninth Circuit precedent gives preemptive effect under Bracker to the federal regime of Indian-leasing regulations, but it does

not extend that effect to state and local leasehold

taxes.

21

The California courts have agreed with the Ninth

Circuit’s result in upholding the taxes, but they expressly disagree with its reasoning. Herpel was the

state courts’ first post-Bracker analysis of a property

tax levied against leased Indian lands. In that decision, the California Court of Appeal acknowledged

that federal leasing regulations for Indian lands “are

extensive,” but it nevertheless held that their “nature”

did not “strongly support preemption” at all. 45

Cal.App.5th at 110-111. The court acknowledged “that

this puts us in disagreement with courts that have”

found a preemptive “federal interest in … the Leasing

Regulations” under Bracker, citing the Ninth Circuit’s

Segundo decision and the Eleventh Circuit’s Seminole

Tribe decision as examples of this disagreement. Id. at

111.

If there was any doubt about whether this disagreement was durable, the California courts reiterated it in this case. In adhering to Herpel’s version of

the Bracker analysis, the Court of Appeal repeated its

“disagreement” with Segundo and Seminole Tribe.

App.20 n.6.

Given this extensive record of candid disagreement, any attempt to smooth away the conflict must

fall flat. The halfhearted factual distinction offered by

the Herpel court certainly does not hold water. It noted

that Seminole Tribe invalidated a property tax on commercial leases—and suggested counterintuitively that

Riverside County’s similar tax might be valid because

it “extends more broadly to cover residential [leases]

as well,” and Riverside County provides its residents

with “access to public schools.” 45 Cal.App.5th at 115116 (emphasis added). But that explanation is

22

incoherent under the Bracker balancing analysis. On

one side of the balance, neither Seminole Tribe nor

Herpel suggested that the federal or tribal interest in

preemption is stronger with respect to commercial

leases of Indian lands. And on the other side, both the

state tax in Seminole Tribe and the Riverside County

tax in Herpel were for “the general raising of revenue,”

compare 799 F.3d at 1343 with 45 Cal.App.5th at 108,

and nothing in the Eleventh Circuit’s opinion hinted

that the court somehow excluded the value of public

education from its analysis of the state interests involved.

Nor can Seminole Tribe be explained away, as one

district court tried, on the ground that Florida (unlike

Riverside County) would have required “the Tribe lessor … to pay the rental tax” if the lessee had failed to

do so. Agua Caliente Band, 2017 WL 4533698, at *16

(C.D. Cal. June 15, 2017). On appeal from that decision, the Ninth Circuit did not rely on that distinction,

see 749 F.App’x 650, and for good reason: the plaintiffs

in Seminole Tribe included the non-Indian lessees who

had actually paid the tax, and the court struck down

the tax as applied to them, not just to the tribe. See

799 F.3d at 1327, 1343 & n.14.

To sum up: this case has extended an acknowledged split of authority in the courts about the application of Bracker preemption to state and local

collection of property taxes on Indian lands from nonIndian lessees. The split is compound and longstanding and, far from showing any sign of resolving itself,

has solidified in recent years—including in this case.

The Court should grant certiorari to resolve this confusion in the law.

23

II. This Court Has Yet To Clarify The

Boundaries

Of

Statutory

Express

Preemption Of Taxes On Trust Lands.

The second point of confusion that this Court

should resolve is the scope of the Indian Reorganization Act’s express prohibition of “State and local taxation” on “any [Indian trust] lands or rights acquired”

by the Secretary of the Interior “pursuant to this Act.”

25 U.S.C. § 5108. 7

There is no dispute that the “State and local taxation” prohibited by § 5108 includes property taxes on

Indian land collected from non-Indian lessees. The

question, instead, is over what qualifies as “rights acquired pursuant to [the] Act.” Although the United

States has held title to the Agua Caliente Reservation

since before the IRA became law, the United States’

trust rights were set to expire in 1994 until Congress

amended the IRA (in 1990) to extend them and make

them indefinite. Petitioners contend that these extended trust rights are “rights acquired pursuant to

[the] Act.” The California courts disagreed, but the

trouble is that the caselaw provides little guidance for

deciding the question.

Since the IRA was enacted in 1934, this Court has

discussed what rights in land qualify for § 5108 protection only once, and only briefly. Mescalero Apache

Tribe dealt mainly with the separate question of

7 Before the 2016 recodification of Title 25 of the U.S. Code,

current § 5108 was instead § 465. See U.S. Code Editorial

Reclassification Table, http://uscode.house.gov/editorialreclassifi

cation/t25/T25-RT.pdf.

24

whether and when a state may tax a tribe-owned business. But in a brief discussion, the Court also held that

§ 5108 can protect even an interest in land that “was

not technically ‘acquired’ ‘in trust for the Indian

tribe.’” 411 U.S. at 155 n.11. Mescalero involved a

tribal ski resort “on land [that was] outside the boundaries of the Tribe’s reservation,” but that “was leased

from the United States Forest Service.” Id. at 146. The

Court adopted a pragmatic reading of section 5108,

noting that “the United States … already had title to

the forest,” and it would have been “meaningless … to

convey title to itself for the use of the tribe,” as the

statute literally contemplates. Id. at 155 n.11 (citation

omitted).

The Mescalero Court did not, however, announce

any more general principle for determining whether

an interest in land qualifies for protection under

§ 5108. Later courts and commentators have lamented

it as “[u]nfortunate[]” that the Court “provided no explicit explanation” for its conclusion, Herpel, 45

Cal.App. 5th at 121, and that the Court “merely announced that section 465 applied” “without any discussion” of the underlying issues. See Pomp, The

Unfulfilled Promise of the Indian Commerce Clause

and State Taxation, 63 Tax Law. 897, 1052 (2010).

Indeed, lower courts considering whether an

interest in land qualifies for § 5108 protection

frequently seem unaware of this Court’s direction in

Mescalero. The Supreme Court of South Dakota has

limited § 5108 preemption to land acquired by the

United States through formal “fee-to-trust transfers,”

without citing Mescalero on this point. Pickerel Lake

Outlet Ass’n v. Day County, 953 N.W.2d 82, 89-90 (S.D.

25

2020). And the Washington Court of Appeals has

held—also without citing Mescalero on this point—

that when Congress authorizes the leasing of preexisting trust lands, that right to lease the lands is not

“acquired pursuant to this Act, within the meaning of

§ 5108.” Sifferman v. Chelan Cnty., 496 P.3d 329, 342

(Wash. Ct. App. 2021) (cleaned up). The only court

that seems to have grappled with Mescalero on this

issue is the Court of Appeal of California in Herpel—

which essentially limited this aspect of Mescalero to

its facts, concluding that it applies only to federal

lands leased to Indian tribes after the IRA was

enacted, or to tribal projects “developed with money

provided by … the Indian Reorganization Act.” 45 Cal.

App.5th at 121-122.

This is too important a question to continue to go

unanswered. As the South Dakota Supreme Court

explained in Pickerel Lake, “a number of different

trust landholdings exist” in a “patchwork of trust land

categories.” 963 N.E.2d at 89 (cleaned up); see also

Yankton Sioux Tribe v. Podhrasky, 606 F.3d 994,

1001-02 (8th Cir. 2010) (describing a single

reservation’s four categories of “trust lands” and two

categories of “fee lands”). As in Mescalero, 411 U.S. at

155 n.11, a great many of these lands arguably “w[ere]

not technically ‘acquired’ ‘in trust for the Indian

tribe.’” See Yankton Sioux Tribe, 606 F.3d at 1001 (on

one reservation, “lands … which have been

continuously held in trust” predominated over “IRA

Trust Lands” by a margin of nearly 5 to 1). As matters

stand, neither the beneficial owners of these lands nor

state taxing authorities have any way to anticipate

how § 5108 may affect those lands’ tax status. As the

26

Court of Appeal of California noted in this case, the

results either way could be “dramatic.” App.16.

III. The Court Should Grant Review To Resolve

The Split.

Now is the time, and this is the case, for the Court

to grant review and clarify the confusion in the law.

As described above, the split of authority is longstanding and deepening. And the lower courts in this

case squarely decided both questions presented and

identified no vehicle problems or alternative grounds

for resolving the case. Indeed, there could be no factual

disputes, as the essential facts were all stipulated

between the parties. App.7.

For the lower courts, a grant of review in this case

would provide guidance on a perplexing set of

questions of federal law. For Indian tribes, review

would provide the hope that the approach of land

development to once-isolated reservations can provide

both increased economic prosperity and a greater

degree of practical sovereignty over tribal lands. And

for everyone, it would mean certainty and uniformity

on two questions of federal law where there currently

is neither.

CONCLUSION

The Court should grant certiorari and set the case

for merits briefing and argument.

27

Respectfully submitted,

Aaron D. Van Oort

Counsel of Record

Jerome A. Miranowski

Nicholas J. Nelson

Joshua T. Peterson

Thomas K. Pryor

FAEGRE DRINKER BIDDLE &

REATH LLP

2200 Wells Fargo Ctr.

90 South Seventh Street

Minneapolis, MN 55402

aaron.vanoort@faegredrinker.com

Counsel for Petitioners