[House Report 113-625]
[From the U.S. Government Publishing Office]
113th Congress Rept. 113-625
HOUSE OF REPRESENTATIVES
2d Session Part 1
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GRAND PORTAGE BAND PER CAPITA ADJUSTMENT ACT
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November 17, 2014.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
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Mr. Hastings of Washington, from the Committee on Natural Resources,
submitted the following
R E P O R T
[To accompany H.R. 3608]
[Including cost estimate of the Congressional Budget Office]
The Committee on Natural Resources, to whom was referred
the bill (H.R. 3608) to amend the Act of October 19, 1973,
concerning taxable income to members of the Grand Portage Band
of Lake Superior Chippewa Indians, having considered the same,
report favorably thereon without amendment and recommend that
the bill do pass.
Purpose of the Bill
The purpose of H.R. 3608 is to amend the Act of October 19,
1973, concerning taxable income to members of the Grand Portage
Band of Lake Superior Chippewa Indians.
Background and Need for Legislation
H.R. 3608 would provide that certain funds paid by the
State of Minnesota and held by the United States in trust for
the Grand Portage Band of Lake Superior Chippewa Indians shall
be exempt from federal and state taxation. Such funds stem from
a treaty-related settlement agreement between the Band and the
State of Minnesota. The bill further provides that such funds
shall not be counted against the Band members' eligibility for
federal financial assistance, unless the funds are distributed
to them on a per capita basis in an amount exceeding $2,000.
The Grand Portage Band is one of five constituent bands of
Indians comprising the greater Minnesota Chippewa Tribe. The
Minnesota Chippewa Tribe and each of its five bands are
federally-recognized tribes. The Grand Portage Band has a
50,000-acre reservation of densely forested lands in the
extreme northeastern region of Minnesota, bounded by Canada,
Lake Superior, and the Grand Portage State Forest.
The Band is a party to an 1854 treaty under which its
members retained certain hunting and fishing rights in lands
ceded by the tribe. Pursuant to a 1988 settlement with the
State of Minnesota over state regulation of Indian fishing
rights in the 1854 treaty area, the Grand Portage Band and Bois
Forte Band of Chippewa Indians (another one of the five bands)
agreed to restrict their members from exercising their fishing
rights in exchange for certain payments from Minnesota.
According to the Department of the Interior, the State annually
pays the Grand Portage Band $1.6 million pursuant to this
agreement.
In 1999, during the 106th Congress, Senator Paul Wellstone
(D-MN) introduced S. 1838 to make the State settlement payments
to the two bands non-taxable.
In 2000, Senator Ben Nighthorse Campbell (R-CO), the
Chairman of the Indian Affairs Committee, introduced S. 3010,
an omnibus technical amendments bill that included the tax
exemption language for both bands. That committee reported S.
3010 with an amendment that removed the Grand Portage Band from
the tax exemption provision. The Senate Committee report
accompanying the bill offers no explanation for the deletion of
the Grand Portage Band provisions.
The tax exemption for the Bois Forte Band was eventually
included in an omnibus Indian bill introduced by Congressman
John Thune (H.R. 5528), and enacted as the Omnibus Indian
Advancement Act (Public Law 106-568).
As a practical matter, it is unclear whether the Internal
Revenue Service (IRS) is enforcing any taxation of payments
received by the Band's members from the State of Minnesota
pursuant to the fishing rights settlement. By letter dated
November 15, 2013, the Chief of Staff of the Joint Committee on
Taxation responded to a letter the author of H.R. 3608 had sent
seeking an analysis of the effect of H.R. 3608 on revenues. The
Joint Committee staff member estimated that the proposal would
have no net effect in light of guidelines the IRS normally
follows concerning Settlement payments made to members of the
Band. The letter notes, however, that the IRS does not consider
its guidelines to be precedential.
The Natural Resources Committee may not be suited to
analyzing the revenue effects of the H.R. 3608. With this in
mind, it should be noted that the bill has been additionally
referred to the Committee on Ways and Means and the Committee
on the Judiciary. Both of these committees have agreed to be
discharged from further consideration of the bill.
On July 29, 2014, the Subcommittee on Indian and Alaska
Native Affairs of the Committee on Natural Resources held a
hearing on H.R. 3608. No objections to the bill were heard and
the Department of the Interior expressed support for enactment
of the legislation.
H.R. 3608 amends 25 U.S.C. 1407(4) and provides the Grand
Portage Band with the same tax and federal financial assistance
eligibility benefits provided to the Bois Forte Band under
Public Law 106-568. Under this bill, a member of the Band does
not have to count as income payments received pursuant to the
settlement between the Band and the State under which the Band
forgoes certain fishing activities. In addition, such income
shall not count against the individual's eligibility for
certain federal financial assistance as long as it does not
need exceed $2,000.
Committee Action
H.R. 3608 was introduced on November 21, 2013, by
Congressman Richard Nolan (D-MN). The bill was referred to the
Committee on Natural Resources, and within the Committee to the
Subcommittee on Indian and Alaska Native Affairs. The bill was
also referred to the Committees on Ways and Means and the
Judiciary. On July 29, 2014, the Subcommittee held a hearing on
the bill. On September 18, 2014, the Full Natural Resources
Committee met to consider the bill. The Subcommittee on Indian
and Alaska Native Affairs was discharged by unanimous consent.
No amendments were offered and the bill was adopted and ordered
favorably reported to the House of Representatives by unanimous
consent.
Committee Oversight Findings and Recommendations
Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII of the Rules of the House of Representatives, the
Committee on Natural Resources' oversight findings and
recommendations are reflected in the body of this report.
Compliance With House Rule XIII
1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the
Rules of the House of Representatives requires an estimate and
a comparison by the Committee of the costs which would be
incurred in carrying out this bill. After consulting with the
Congressional Budget Office and the Committee on Ways and
Means, the Committee has concluded that enactment of the bill
will have no significant effect on direct spending or revenue,
and will not otherwise have a significant effect on the federal
budget.
2. Section 308(a) of Congressional Budget Act. As required
by clause 3(c)(2) of rule XIII of the Rules of the House of
Representatives and section 308(a) of the Congressional Budget
Act of 1974, this bill does not contain any new budget
authority, spending authority, credit authority, or an increase
or decrease in revenues or tax expenditures.
3. General Performance Goals and Objectives. As required by
clause 3(c)(4) of rule XIII, the general performance goal or
objective of this bill is to amend the Act of October 19, 1973,
concerning taxable income to members of the Grand Portage Band
of Lake Superior Chippewa Indians.
Earmark Statement
This bill does not contain any Congressional earmarks,
limited tax benefits, or limited tariff benefits as defined
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of
the House of Representatives.
Compliance With Public Law 104-4
This bill contains no unfunded mandates.
Compliance With H. Res. 5
Directed Rule Making. The Chairman does not believe that
this bill directs any executive branch official to conduct any
specific rule-making proceedings.
Duplication of Existing Programs. This bill does not
establish or reauthorize a program of the federal government
known to be duplicative of another program. Such program was
not included in any report from the Government Accountability
Office to Congress pursuant to section 21 of Public Law 111-139
or identified in the most recent Catalog of Federal Domestic
Assistance published pursuant to the Federal Program
Information Act (Public Law 95-220, as amended by Public Law
98-169) as relating to other programs.
Preemption of State, Local or Tribal Law
This bill is not intended to preempt any State, local or
tribal law.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SECTION 7 OF THE ACT OF OCTOBER 19, 1973
AN ACT To provide for the use or distribution of funds appropriated in
satisfaction of certain judgments of the Indian Claims Commission and
the Court of Claims, and for other purposes
Sec. 7. None of the funds which--
(1) are distributed per capita or held in trust
pursuant to a plan approved under the provisions of
this Act, or
(2) on the date of enactment of this Act, are to be
distributed per capita or are held in trust pursuant to
a plan approved by the Congress prior to the date of
enactment of this Act,
(3) were distributed pursuant to a plan approved by
Congress after December 31, 1981 but prior to the date
of enactment of this Act, and any purchases made with
such funds, or
(4) are paid by the State of Minnesota to the Bois
Forte Band of Chippewa Indians [pursuant to the
agreements of such Band] or the Grand Portage Band of
Lake Superior Chippewa Indians, or both, pursuant to
the agreements of each Band to voluntarily restrict
tribal rights to hunt and fish in territory cede under
the Treaty of September 30, 1854 (10 Stat. 1109),
including all interest accrued on such funds during any
period in which such funds are held in a minor's trust,
including all interest and investment income accrued thereon
while such funds are so held in trust, shall be subject to
Federal or State income taxes, nor shall such funds nor their
availability be considered as income or resources nor otherwise
utilized as the basis for denying or reducing the financial
assistance or other benefits to which such household or member
would otherwise be entitled under the Social Security Act or,
except for per capita shares in excess of $2,000, any Federal
or federally assisted program.