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Monday, October 28, 2013

Village Cannot Impose Stormwater Fee on Tribal Land

The Village of Hobart, Wisconsin enacted an ordinance imposing storm water management fees on all land within the Village to finance the construction and operation of a storm water management system.  Members of the Oneida Nation of Wisconsin, an Indian tribe, sued the Village, claiming that the Village was prohibited from imposing the fee on 148 parcels of land owned by the Oneida tribe.  The tribe relied on federal law that prohibits the taxation of "tribal trust land."  In this case, the 148 parcels of land were located throughout the Village rather than within the confines of an Indian reservation. The district court ruled for the tribe, and the Village appealed to the Seventh Circuit.  Oneida Tribe of Indians of Wisconsin v. Village of Hobart, Wisconsin.
The Seventh Circuit stated the question of the case as follows:  Has the federal government authorized municipalities to assess fees on Indian land in the Village to pay for its storm water management program?   Although the court acknowledged that municipalities have some limited authority over Indian territory within their boundaries, in this case the Village had no authority to impose fees to fund its storm water management program because federal law forbids states and local authorities to tax Indian lands.  The storm water fees, in this case, were more in the nature of a tax because it is designed to generate revenue to pay for a government project, not a fee for a service provided to a particular property owner.  As a result, the appellate court agreed with the district court that the storm water management fees could not be imposed on Indian land.


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