The Desert Water Agency in California is suing the Obama administration over a new Bureau of Indian Affairs regulation that bars state and local taxation of non-tribal entities on leased Indian land.

The regulation was first proposed in November 2011. After a round of tribal consultation, it was finalized in December 2012 and went into effect in January 2013.

Despite national media coverage of the rule, including a press release from former Interior Secretary Ken Salazar and a conference call with Assistant Secretary Kevin Washburn, the Desert Water Agency says it only found out about the rule recently. The agency claims it will lose $7 million a year by not being able to tax customers on Indian land, namely that of the Agua Caliente Band of Cahuilla Indians.

“It’s a far-reaching rule that we’re pretty sure, based on our counsel’s opinion, flies in the face of facets of federal law and case law that’s been established in the court,” Desert Water Agency General Manager David Luker told The Palm Springs Desert News.

The lawsuit was filed on March 29. The Agua Caliente Band is not a named party.

Get the Story:
Desert Water Agency sues over new tribal rules (The Palm Springs Desert Sun 4/25)

Relevant Documents:
Complaint: Desert Water Agency v. DOI (March 29, 2013)

Federal Register Notice:
Residential, Business, and Wind and Solar Resource Leases on Indian Land (December 5, 2012)

BIA Documents:
Fact Sheet | Q&A | Comparison of Existing and New Regulations | Final Rule

Related Stories:
Law Article: BIA rule bars state taxation on leased Indian land (4/15)