...many people who've arrived over the last century and a half see this Native American land grab as a drain on their tax base and powers of economic development. That's because tribal leaders are increasingly removing the land from tax rolls by placing it into federal trust. It's a perfectly legal maneuver dating to the 1934 Indian Reorganization Act, passed to re-establish Native American parcels lost through legislation in 1887. That obscure law was invoked sparingly—until Native Americans had the wherewithal to go on a real-estate spending spree. Now government officials and critics are trying to fend off the Native American's land rush. "I don't think in the modern world it makes any sense to tie any individual rights to a tribal entity that is unaccountable," said David Vickers, president of Upstate Citizens for Equality in Verona, N.Y., an organization which disputes the notion of Native American sovereignty. "It's possible to maintain cultural identity without establishing a separate land base."
Vickers is part of a battle heating up in central New York state. Last week, the U.S. Department of the Interior sided with the Oneida Indian Nation of New York by allowing 13,004 acres owned by the nation to be put into a tax-free trust. The designation also makes the land an independent territory, subject to most federal laws but not all state, city or county regulations or taxes. The tribe—which operates the Turning Stone Resort and Casino, a golf course on the PGA Tour, gas stations, convenience stores, government buildings, a 1,200-head Angus beef farm and cultural facilities—said it planned no changes for the property.
That decision was the latest round in a long-running tussle. After the tribe bought land in the 1990s, the city of Sherrill, N.Y., tried to collect property taxes, and the two sides went to court. In March 2005, the U.S. Supreme Court ruled against the tribe but suggested that the land would be tax-exempt if it were in trust. In April 2005, the nation applied for trust status for almost all of its land holdings. In a ruling last week, the Interior Department said putting the land into trust would address the Oneida Nation's "need for cultural and social preservation and expression, political self-determination, self-sufficiency, and economic growth by providing a tribal land base and homeland."