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The Shawnee News-Star
  • Sales tax trouble: Shawnee city officials, tribal leaders swap another round of letters

  • Another round of letters was exchanged between Shawnee city officials and tribal leaders. While a meeting date and location have been confirmed, more pre-meeting issues remain unsettled.
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  • Another round of letters was exchanged between Shawnee city officials and tribal leaders. While a meeting date and location have been confirmed, more pre-meeting issues remain unsettled.
    Shawnee Mayor Wes Mainord sent a letter to tribal leaders dated March 17 in response to the letter sent to city officials sent on March 10.
    “While we proposed a more neutral location for the first meeting, the city will agree the first meeting between the city and the Tribal Nations can be at the Citizen Potawatomi Nation’s Cultural Heritage Center on March 24, 2014 at 10 a.m.,” Mainord wrote.
    Through the past several letters, both city officials and tribal leaders have asked counter parties for information and data, although the categories of information and data have varied.
    “Your request for information indicates that the Citizen Potawatomi Nation and the city have differing views about the pertinent information,” Mainord wrote.” You did not respond to the request in my March 7, 2014 letter for the Tribal Nations to provide information pertaining to your retail sales, which we will need to calculate the sales tax not being paid to the city.”
    Mainord provided preliminary data of the city’s sales tax revenue attributable to grocery sales from 1997-2012 comparing Walmart and FireLake Grocery with the March 7 letter. In that letter, the city requested tribal leaders provide similar preliminary data.
    Mainord stated in the letter the city would discuss exchange of information at Monday’s meeting.
    “But, in response to your request, we have provided you all of the information we used to assess the impact of tribal sales on our sales tax receipts,” Mainord wrote.
    In a letter dated March 10, Citizen Potawatomi Nation Chairman John Barrett asked city officials for data used to support the premise that City of Shawnee sales tax revenues are declining, data used to support the premise tribal economic development is directly responsible for any declining City sales tax revenues, the amount and recipient tax incentives and/or rebates offered or provided over the last five years to non-tribal enterprises by the City of Shawnee or by the State for development or preservation of businesses within Shawnee, and donations, contributions, payments in lieu of taxes, and similar assistance provided over the last five years by the aforementioned Tribes to the City of Shawnee.
    Mainord wrote in the most recent letter the purpose of the meeting is to discuss whether the city and the Tribal Nations can agree to terms on which the Tribal Nations will collect and pay city sales tax for sales to non-members at tribal enterprises owned under the United States Supreme Court.
    “We are not trying to vilify or scapegoat any Nation, but seek to engage in mutually respectful discussions over a matter of interest to all Shawnee residents, including those who are members of the Tribal Nations,” Mainord wrote.
    Page 2 of 3 - “Most importantly, none of the requests in your letter relate to whether the Tribal Nations must pay sales tax on sales, only to non-members, under the Supreme Court’s decision,” Mainord wrote.
    Barrett responded to the city’s letter with a letter dated March 19.
    “As for your claim of taxes we owe the City of Shawnee under “the Supreme Court’s decision” (your words), I assume you are referring to the 1996 United State Supreme Court Case of Citizen Potawatomi v. Oklahoma Tax Commission in which Justice Rehnquist, in dicta, not in the decision, made a comment that the “State has a right without a remedy” to collect taxes on sales to non-Potawatomi inside our governmental jurisdiction,” Barrett wrote. “The remedy still does not exist or OTC wouldn’t be asking Shawnee to do their dirty work and waste the city’s money.”
    While Mainord did not provide data as requested, he did address the four requests for information.
    Mainord stated in the letter that the city has provided the only data they used to support the premise that City of Shawnee sales tax revenues are declining.
    Mainord wrote that after CPN opened FireLake grocery in 2001, the city’s sales tax revenues attributable to groceries declined by over $300,000 by the third year of operation.
    “Even if we assumed that there had been no increase in sales due to growth and inflation, that indicates a loss to the city of approximately $4,000,000 since FireLake grocery opened,” Mainord wrote.
    Mainord addressed the impact on economic development data by stating the taxes support public services to the Shawnee community, which includes many members of all four Tribal Nations.
    “While the city’s right to sales taxes does not depend on proof of economic impact, it is obvious that no part of a dollar spent at Tribal Nations’ retailers has gone to the city as sales tax, and that three cents of the same dollar would come to the city if the purchase had been made at another retailer within the city,” Mainord wrote.
    Mainord addresses incentives by stating the major new developer bringing a retail development to Shawnee, which will bring increased sales tax revenues and infrastructure improvements to the city, has been given incentives.
    “If any Tribal Nation has a similar proposal for future development, we would be happy to talk with you about similar agreements,” Mainord wrote.
    Mainord addressed the tribes’ contributions by writing he doesn’t know the reason the Tribal Nations would need information from the city on that subject.
    Page 3 of 3 - “While the city greatly appreciates the Tribal Nations’ contributions to the Shawnee community, we assume the Tribal Nations would have any information about payments or similar assistance they have provided to the community, and we don’t compile this information,” Mainord wrote.
    Barrett addressed the lack of data in his March 19 response to the city by writing the city provided none of the information requested.
    “You have not demonstrated good faith for the meeting of the 24th in failing to do so,” Barrett wrote.
    Barrett stated in the letter CPN is not in Shawnee.
    “You have provided no evidence that you legally annexed our territory, even if that was possible,” Barrett wrote.
    Barrett wrote the City of Shawnee has no evidence Congress intended that the City of Shawnee have the ability to encroach on the territorial sovereignty of their Nation.
    Barrett wrote that a significant amount of new federal law and regulation denies it and Supreme Court decisions are interpretations of the law as passed by Congress in which the Court seeks to define Congressional intent, not make new law.
    “If you wish, you can try to act on Justice Rehnquist’s “right to tax” by stopping cars coming out of our businesses, make them prove where they live and that they are not citizens of the Citizen Potawatomi Nation, then empty their sacks and scan their groceries and collect your 3 percent new tax,” Barrett wrote. “I don’t think your citizens will take it.”
    Mainord ended his letter by stating he hoped the letter gave the Tribal Nations further prospective on what the city feels is important for discussion.
    “We will engage in an exchange of information with you in order to further our negotiations, but we believe the duty to collect and pay sales tax on all sales within city limits, with the exception of Tribal Nations’ sales to their members, is established by federal law,” Mainord wrote.
    Barrett wrote in his letter Shawnee officials don’t have the support of citizens or the business community in the attack.
    “You are trying to bully the CPN and the other tribes by using tax payer’s money to try to influence people not to shop with us and calling it “education”,” Barrett wrote.
    Barrett concluded his letter with a simple, but powerful, statement.
    “If you do not send us the information, the meeting on the 24th will be very short,” Barrett wrote.
     
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