Tribal land tax issue - No let-up in the local lobbying effort

La Conner town and school officials continued hounding state and federal officials this week as some residents prepare to shell out up to 25 percent more in property taxes by the April 30 deadline.

On Tuesday, the town-school lobbying consortium met with representatives of U.S. Senator Patty Murray and U.S. Senator Maria Cantwell.

“We’re reaching out where we can and trying to do what we can,” said La Conner School Board President Rick Thompson, whose own property tax bill went up by more than $1,000 this year following a federal decision that made 931 parcels in the school district tax exempt.

With most of the Shelter Bay community and homes in the Pull & Be Damned Road neighborhood off the tax rolls, the tax burden was shifted to the remaining taxpayers.

The La Conner schools take the largest bite out of the local tax bills, particularly since voters in the district passed a $20 million bond in February 2013 to fund campus improvements and a new middle school. On Tuesday, the lobbying group asked the federal lawmakers to get the government to fill the funding gap, which would keep the schools solvent and give taxpayers relief.

“I think they were very receptive,” Thompson said. He said he was encouraged to learn that Senator Murray is a ranking member on the committee that deals with impact aid for schools that serve students on tax exempt federal land.

In the so-called Great Wolf decision, the U.S. Court of Appeals for the 9th Circuit on July 30, 2013 — months after the school bond was passed — ruled that all structures, regardless of ownership, built on land that is held in trust for Indian tribes is immune from state and county taxes. Most of the homes in Shelter Bay and Pull & Be Damned are built on land leased from the Swinomish Indian Tribal Community.

The tribe has pledged $400,000 to the school this year, but the district was faced with a loss of closer to $800,000 with the properties coming off the tax rolls. Last fall, when the school district had to send in its levy request to the county, it lowered the amount it was seeking by $250,000, but the hit to taxpayers was still a big one.

The contribution from the tribe is contingent on money the new Swinomish Tax Authority intends to collect from the lease parcels. Shelter Bay residents have been assessed property tax by the tribe at the new higher rate levied by the county against privately owned parcels. Last year the now tax exempt parcels generated about $1.8 million in property tax that fed nine agencies, including the schools.

The tribe also spends $550,000 to provide tribal employees as teacher aides, specifically aimed at enhancing the education of tribal students. That program, which has been in effect for several years, has been effective in improving the graduation rates of tribal students.

Last Wednesday the lobbying group, which was initially organized by Mayor Ramon Hayes, met with a representative from U.S. Rep. Rick Larsen’s office. They have also traveled to Olympia to pressure our state legislators and state Superintendent of Public Instruction Randy Dorn.

State Rep. Norma Smith, R-Clinton, arranged the meeting with Dorn, and she and other legislators have been working to carve money out of the state budget being worked on in the current session to aid the school district.

Smith said they have been trying to fast-forward funding to help with the school construction now underway and see if money can be found to help with the operational side of the district, as well.

“We’re going to do the best we can to find at least some sort of solution in the short term,” Smith said. And the federal legislators will be hearing from our state representatives, too. “We’re hoping we can encourage them to be more diligent to do something at the federal level,” she said.

The town is making sure the elected officials are getting the message. “We exhaustively went through the entire issue with them point by point,” said Mayor Hayes. “Our basic message to them is this is a situation created at the federal level, and it requires a federal solution.”

Hayes said nobody is contesting the Great Wolf decision, and local residents are grateful the tribe enacted an ordinance to prevent the homeowners on the 931 parcels from seeking tax refunds going back to 2011 — refunding close to $6 million would have bankrupted the schools and ultimately landed on the backs of the remaining taxpayers. Residents also appreciate the money the tribe has promised to the schools this year, he said, but a permanent solution must be found.

“The community needs to see that something is being done,” said Town Councilman Bill Stokes, who has also been part of the lobbying committee. Having the smaller pool of taxpayers pick up the bigger bill “is not sustainable,” he said.

While Smith and other state legislators have been working to find an emergency fix, “the federal government created the problem,” Stokes said, “and the federal government should fix it.”