1. State Tax Exemptions and Reform Planning National Intertribal Tax Alliance September 17, 2015

2. Welcome Moderator:  Aubrey Seffernick, Partner, Miller Nash Graham & Dunn LLP Panelists:  James T. Meggesto, Partner, Holland & Knight LLP  Mary Streitz, Partner, Dorsey Whitney LLP  F. Michael Willis, Partner, Hobbs, Strauss, Dean & Walker LLP

3. Introduction  Survey of the tools a Tribe can use to resolve taxing jurisdiction issues with the state  Whether it be asserting an immunity, resolving a “grey area,” or pushing for a legislative exemption as good public policy

4. Overview  Legislation: the carpenter’s pencil  Litigation: the hammer  Tribal-State Compacts: the level  Business Structures: the monkey wrench  Agency letter rulings and interpretations: the chisel

5. Legislation  When is legislation a good tool?  Current issues being addressed through legislative efforts: – Federal Authority to issue tax-exempt debt Income of minors Streamline sales tax collection Tribal charities classified as public charities – State Taxation of off-reservation property Areas with strong public policy implications

6. Legislation, cont.  Case Study: – HB 1287 in Washington State regarding fee land owned by the tribe – Original Bill: expand definition of “essential governmental services” to include “economic development” for property tax exemption on land owned in fee by a tribe. – Bill as enacted: PILT provision added; cut-off & sunset added – Legal Challenge: King County Superior Court declared the PILT provision unconstitutional holding that the PILT is a property tax and, as such, violates the uniformity provision of the State Constitution.

7. Litigation  When is litigation the best or only option?  What can a tribe do to prepare a case for litigation?  What are some issues we expect will only be resolved through litigation?  Examples: – AUTO v. State – Tulalip Quil Ceda Village

8. Tribal-State Compacts  What issues are ripe for state tribal agreements?  What are some of the issues that will bring the state to the table? – Enforcement issues – Tax parity – Collection from non-Indians – Uniform regulatory structure

9. Tribal-State Compacts, cont.  Examples: – Fuel compacts – Cigarette tax compacts – Liquor tax compacts – New: HB 2000 Washington State Cannabis Compacts

10. Business Structure  What tax consequences can be avoided through careful business planning or deal structuring? – Tribe itself – Tribal corporation – Section 17 corporation – State entity with majority tribal ownership

11. Agency Rulings  What issues may be chipped away at through negotiations with state revenue or other agencies?  Examples of resolution that might be reached through a state revenue department: – Interpretive statement/FAQ’s – Letter Rulings: e.g. applying Bracker to facts a tribe offers – Settlement for a specific assessment – Closing Agreement - Minimal burdens analysis

12. Agency Rulings, cont.  What is the scope of the agency’s authority?  Can the state agency assist the tribe with resolving issues with a local jurisdiction?  Can the state agency provide certainty for business partners or vendors?

13. Thank You  Aubrey Seffernick: aubrey.seffernick@millernash.com aubrey.seffernick@millernash.com  James Meggesto: james.meggesto@hklaw.com james.meggesto@hklaw.com  Mary Streitz: Streitz.Mary@dorsey.comStreitz.Mary@dorsey.com  F. Michael Willis: mwillis@hobbsstraus.commwillis@hobbsstraus.com