Flandreau Santee Sioux Tribe v. Michael Houdyshell, No. 20-3441 (8th Cir. 2022)Annotate this Case
The Eighth Circuit reviewed a case for the second time regarding “whether a South Dakota tax on nonmember activity on the Flandreau Indian Reservation (the Reservation) in Moody County, South Dakota is preempted by federal law. On remand, and after a six-day video bench trial, the district court entered judgment in favor of the Tribe, concluding again that federal law preempts the imposition of the tax.
The Eighth Circuit reversed and remanded. The court explained that in light of guideposts from the Supreme Court, even with the evidence that the district court heard at trial, the court cannot conclude that the federal regulation in IGRA regarding casino construction is extensive. The court reasoned that even with a more factually developed record than the court considered on summary judgment, the Bracker balancing test does not weigh in favor of preemption under IGRA because the extent of federal regulation over casino construction on tribal land is minimal, the impact of the excise tax on the tribal interests is minimal, and the State has a strong interest in raising revenue to provide essential government services to its citizens, including tribal members. The district court thus erroneously entered judgment in favor of the Tribe based on IGRA’s preemption of the excise tax.
Court Description: [Shepherd, Author, with Colloton and Kelly, Circuit Judges] Civil case - Indian law. For the court's prior opinion in the matter see Flandreau Santee Sioux Tribe v. Haeder, 938 F.3d 941 (8th Cir. 2019). On remand, the district court again determined that a South Dakota excise tax on work performed by a nonmember contractor hired by the tribe in relation to a renovation of its casino and hotel on the Flandreau Indian Reservation was preempted by the Indian Gaming Regulatory Act (IGRA) and the Indian Trader Statutes. The district court erred in concluding that the excise tax was preempted through the IGRA under the balancing test set forth in White Mountain Apache Tribe v. Bracker, 448 U.S. 136 (1980); applying the Bracker test, the extent of federal regulation and control of casino construction is minimal, the impact on tribal interests is minimal while the state has a significant interest in raising needed revenue, and the financial and self-governance impacts on the Tribe are not significant; the Indian Trader Statutes did not preempt the excise tax, either expressly or under the Bracker test. Reversed and remanded with directions to enter judgment for the State. Judge Kelly dissenting.