ONEIDA NATION HOMELANDS, N.Y. — Foreclosure stirs up a long, dark history
for New York state American Indians.

These memories shadow the Oneida Indian Nation’s decision to contest tax
bills in 22 localities that have issued them in the aftermath of the U.S.
Supreme Court’s City of Sherrill v. Oneida Indian Nation of New York
decision. Although local officials have derided the legal strategy as a
rear-guard action, it can also be seen as the reaction to a long history in
which state and county governments tried to use foreclosure actions to
drive Indians from tribal land.

This history goes back to the early 19th century. Although the state
Legislature received a sound rebuff from the U.S. Supreme Court, county
officials tried the same tactic in the early 20th century. They succeeded
for a time in evicting Oneidas from their land, until federal courts
intervened.

With this background, it should be no wonder that the Sherrill case is
being fought so tenaciously. In the original suit, the city of Sherrill
tried to collect taxes on several Oneida properties. The nation refused to
pay, saying that the land was part of its treaty reservation and had
reverted to sovereign tribal status when it was repurchased. In an 8 — 1
decision on March 29, the Supreme Court rejected this “unilateral”
assertion of sovereignty.

The Sherrill case was remanded to federal District Court for a final order,
which is still pending. In the meantime, the federal judge issued an
injunction against further collection efforts by the city. But Oneida
County filed its own foreclosure action June 1 over 59 parcels. The nation
filed a federal lawsuit July 27 to stop the action and in early August paid
$650,000 against the estimated $5 million due.

Oneida spokesman Mark Emery said the contribution was not a tax payment,
but “a good faith payment to resolve the tax dispute.” The county
reciprocated by suspending the foreclosure action.

At the same time, the nation filed suit in state Supreme Court (the lower
rung of the state court system) against 22 school districts and local
governments to block tax bills. The suits argue that under federal and
state laws not at issue in the Sherrill case, the land cannot be assessed
or should be assessed at zero value because it can’t be sold. Said Emery,
“The nation has filed these suits in state court to prove that under state
law, no taxes are due.”

The Sherrill decision also opened a round of mechanic’s lien suits arising
from a dispute with the lead contractor in the Turning Stone Resort and
Casino expansion project. Although the Oneidas, owners of Turning Stone,
can still assert sovereign immunity against lawsuit, the property itself is
not on sovereign territory, according to the Sherrill decision. (The
Oneidas have since filed applications with the Department of Interior to
put their 17,000 acres of reacquired land into trust or restricted fee
status.)

The Oneida County clerk’s office has recorded 10 mechanic’s liens totaling
more than $7 million from subcontractors of Hunt Construction Groups of
Arizona, one of two main contractors on the $350 million expansion project.
The Oneida Nation refuses to pay Hunt in a dispute over its work on the
project. Said Emery, “The subcontractors’ issues are between the
subcontractors and Hunt per their contracts. As for the nation’s
relationship with Hunt, the nation has issues with Hunt regarding the
completion of the project and is doing the best it can to resolve the
issues.”

(The Oneida Indian Nation is also owner of Four Directions Media, the
publisher of Indian Country Today.)

Although New York tribes are more legally sophisticated than in the past,
the foreclosure cases resonate with a similar round of suits in the 1840s.

In 1840, the state Legislature passed a highway tax on the Seneca Nation’s
Allegany and Cattaraugus reservations and the following year authorized the
counties of Erie and Cattaraugus to do the same. When the Senecas refused
to pay by 1848, the state comptroller advertised the land for sale and by
1859 conveyed nearly 34,000 reservation acres to a private buyer.

New York state courts upheld the sale, and the state even refused a payment
of taxes by a previous owner, but the U.S. Supreme Court thought otherwise.
In 1867 it ruled, in the famous New York Indians case, that the taxes were
“illegal and void.”

“We must say,” wrote Justice Samuel Nelson, “regarding these reservations
as wholly exempt from taxation … the exercise of this authority over them
is an unwarrantable interference, inconsistent with the original title of
the Indians, and offensive to their tribal relations.”

He hinted archly that these actions, and the original state legislation,
were meant to help “unworthy persons” harass the Senecas off their land,
“secured by the most sacred of obligations of the Federal government.”

Although the Supreme Court, at least that of the 1860s, made clear it
disapproved of New York state’s “illegal” actions, the scolding didn’t stop
the issue from coming up again. In 1907, the state’s courts used another
foreclosure action to evict Oneida families from the last 32 acres in
tribal hands. The emotion of the eviction at county hands is still a
powerful tribal memory.

The foreclosure involved non-payment of a mortgage instead of taxes, but
when the federal court stepped in, it found it was just as illegal. The
United States sued Julia Boylan, holder of the mortgage, and the 2nd
Circuit Court of Appeals ruled that the sale of tribal land was null and
void.

Finding that the Oneidas were “a distinct people, tribe, or band,” the
three-judge panel wrote: “The right of self-government has never been taken
from them. It has never been questioned, and no attempt made at subjecting
them as a people, and it has always been considered and recognized by the
states as a right of the federal government to make provisions for the
dispositions of their lands, and until such was made by the federal
government the right of occupancy remained in the Indians.”

Even the Sherrill decision recognized Oneida sovereignty over the 32 acres
in the Boylan case. Justice Ruth Bader Ginsburg offered the presumably
“multilateral” Interior land-into-trust process as an alternate means of
extending tribal sovereignty over reacquired reservation territory.
Although local officials might be disappointed, the foreclosure ploy might
be no more successful at dispossessing Indians than it was in the last two
centuries.