Leases The Bureau of Indian Affairs handles the leasing of Tribal and Allotted lands on the Fort Peck Reservation. This occurs primarily during two sales each year, although negotiated leases are also permitted. The Bureau of Land Management under Federal law oversees the drilling and production. This includes all phases of the surface disturbance during drilling and production operations. Supervising environmental and cultural assessments are the responsibility of the Bureau of Indian Affairs.
Royalty Payments The Federal Minerals and Management Service handles royalty payments to the Fort Peck Tribes. They handle the collection of royalties from operations and the payment of the money to the Bureau of Indian Affairs for distribution. Production and revenue accounting on Tribal lands (not Allotted) under joint venture agreements, or operating agreements is handled by an independent accounting firm other than the MMS. The Bureau of Land Management under Federal law oversees the drilling phases of a prospect from site development to production. Environmental and cultural assessments are also monitored. Companies operating on the Fort Peck Reservation are required to employ Indian people while working on trust lands. They are encouraged to do so while operating on adjacent, non-Indian lands. The maximum collectible tax is 7 percent. Any revenue above 27 percent is written off as a credit against the tax. Payment is made quarterly to the Tribes. At this time, operators are still paying all regular state and local taxes in Trust production as well.
Contractors Business Tax The Tribes also levy a tax similar to the Navajo Business Activity Tax. This is a 0.5 percent tax on the gross receipts of any contractor making more than $100,000 in real improvements on Trust land. Large construction projects, mining and related developments, and utility construction are all liable for this tax. Businesses wholly owned by the Tribes are exempt.
Utilities Tax A third tax, enacted in May 1987, is imposed on the property of utilities within the reservation, excluding Tribally owned entities or utilities located on Tribal lands with a total value less than $200,000. Property is assessed annually and based on a value computed using Montana Codes Chapters 15-23. An appointed three member Tax Commission arbitrates disputes over property valuation. The Burlington Northern Railroad sued the Tribes over this tax, but the Federal District Court in Great Falls upheld the Tribe's power to impose the tax. BN appealed the case to the Ninth Circuit Court in San Francisco and lost. Their present appeal has been taken to the U.S. Supreme Court and a ruling is pending.
Uses of Revenue All revenues received from the three taxes go to the Tribal general fund. At present the issue of dual taxation by both State and Tribes is of great concern. The Cotton Petroleum case decided both States and Tribes have the authority to tax natural resource production. When poverty and unemployment are higher onreservations than off reservation, a net drain of tax resources is unwelcome. The Tribes have recently negotiated tax revenue sharing agreements with the State of Montana affecting, gasoline, alcohol, and cigarette taxes. Fort Peck Oil and Gas Lease Sales Sale dates are set in accordance with Fort Peck Tribal Resolution #474-86-1 passed by the Fort Peck Tribal Executive Board. The Oil and Gas sales are conducted the second Thursday in March and the second Thursday in September of each year, with a minimum of forty-five (45) day advertisement.
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