Tulalip sales tax share debated

OLYMPIA – Opponents of a proposed law that would give the Tulalip Tribes some of the tax money from Quil Ceda Village said Friday that passage would open the door for the other 28 tribes in Washington to seek the same benefit.

That in turn would cost local governments hundreds of millions of dollars, opponents say.

“It is true that this bill is specific to the Tulalip Tribes, but how will the Legislature say ‘no’ to the next tribe and the next and the next?” asked Tom Mitchell, co-president of the Marysville Tulalip Community Association, in testifying against House Bill 1721 before the Senate Ways and Means Committee. The association is made up of homeowners on the Tulalip Reservation who are monitoring a number of issues on the reservation, including residential leases.

Supporters say the tribe has a right to the sales tax money because it paid for all of the infrastructure in Quil Ceda Village, and the village is considered a city under federal law.

The bill, which passed the state House 93-3 in March, would give the Tulalips 0.85 percent of sales tax revenue due to the federally recognized status of Quil Ceda Village as the tribes’ political subdivision, or, essentially, a city, although no one lives within the 2,000-acre business park.

Currently, Snohomish County gets 2 percent of the sales tax revenue from the village, and the county’s portion would fall from 2 percent to 1.15 percent. The state’s share would remain at 6.5 percent. Officials say the reduction would cost the county $1.7 million in 2006 and $12 million over the next six years.

Mitchell called the bill “taxation without representation” for nontribal members because they have no say in the decision and tribal members are exempt from paying the tax.

“Besides just being bad legislation, (the bill) is most probably unconstitutional,” he said. “Our forefathers would be embarrassed by this lack of respect for the very basic building blocks of American society.”

After the hearing, Mitchell said if the bill passes, it’s likely to be challenged in court by the association or others who believe it to be unconstitutional.

No vote was taken Friday. The committee is expected to review the bill Monday. To become law, it must be approved by the committee and then the full Senate.

The bill faces a stiff review.

“We will look at it very strenuously,” said Ways and Means Committee Chairwoman Sen. Margarita Prentice, D-South Seattle.

Rep. Ross Hunter, D-Medina, likened the shift of tax money to what happens when a city annexes an unincorporated areas of the county, such as Arlington’s annexation of the Smokey Point area.

“The bill has been around for a number of years,” he said. “I think it’s a practical deal.”

Tracie Stevens, the Tulalips’ legislative policy analyst, said the Tulalips paid about $45 million for the infrastructure at Quil Ceda Village, including roads, water and sewer. The businesses there have created 2,500 jobs, most of which are performed by non-Indians, Stevens said. The new Seattle Premium Outlet Mall, scheduled to open in May, will add another 500 jobs, she said.

Caldie Rogers, president of the Marysville-Tulalip Chamber of Commerce, called Quil Ceda Village “an economic development superstar.”

“No government in our area has done more toward these (economic development) ends than the Tulalip Tribes through Quil Ceda Village,” Rogers said. “It is the principal economic engine in our immediate area.”

Passage of the bill would provide needed infrastructure support for all the future projects in Quil Ceda Village, as well as helping the Marysville, state and federal governments to rebuild the 116th Street interchange at I-5 and the north-south corridor west of the freeway in the newly annexed Lakewood area, said Mary Swenson, Marysville’s chief administrative officer, who urged passage of the bill.

Bill Tsoukalas, executive director of the Boys &Girls Clubs of Snohomish County, also urged passage, saying the Tulalips support many charities and are the largest supporter of his organization.

“The Tulalip Tribes are truly citizens of our region; as they prosper, they give back to the community,” he said.

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