Top 5 Considerations for Working with Native American Nations

If you are a business owner or entrepreneur and you’ve contemplated working with Native American tribes there are some important things that you should consider.

1.  Culture Fit.  Many business persons unfamiliar with Native American tribes may have certain assumptions about the cultural focus of tribes; however, it is important to recognize that economic development is a crucial part of a primary cultural component for most tribal nations—self-governance and self-determination.  For many tribes who lack a local resident tax base, economic development generates needed revenues for tribal government operations and support community development goals.  These are cornerstone to a tribe’s self-governance and self-determination.  Business entrepreneurs therefore should consider that Native American tribes are open for business, but even with that said, not all business concepts may be attractive to a particular tribal nation for other cultural reasons.

2.  Sovereign Nations.  Native American tribes are separate sovereign nations that are not subordinate to state or local governments.  There is no reason to be intimidated by a tribe’s status as a sovereign nation, but to respect it by understanding their governance structure and federal and tribal law infrastructure.  Indeed, a tribal nation’s status can be an attribute for a business relationship because it can facilitate relationships that would be difficult to develop in other contexts.

3.  Varied Nations/Aligned Interests.  Each Native American nation is different.  It may be tempting to assume that an experience working with one tribal nation is representative of working with another tribal nation.  What one should assume, however, is that while each tribal nation is very unique, it is good policy to assume positive responses to aligned interests.  Different nations may have different governance structures, land base considerations, treaty or federal law based organic documents among many other factors.  For business entrepreneurs interested in working with a specific tribe, it is important to be open first to understanding and being responsive to that nation’s unique attributes and goals, and, crucially, to crafting relationships that align interests.  No snake oil dealers wanted, but business partners are likely welcome.

4.  Tax Benefits.  Some business entrepreneurs may shy away from development in Indian country because of their unfamiliarity with the tax structure on tribal land.  There are some potential tax risks working in Indian country—such as the threat of double taxation.  Recent developments in federal law may help to remove uncertainty that leads to some of the tax risks and, often, such risks can be managed contractually.  But, importantly, there is also the potential for tax benefits that come from working within Indian country or partnering with tribal nations—such as utilizing a tribe’s tax exempt status or claiming available tax credits.  Focus on crafting a business relationship that can capitalize on attributes and align interests can maximize the win-win for the business entrepreneur and the tribe.

5.  Permitting.  It is important to know if the project area is on federally-restricted “trust” land—land owned by the federal government in trust for a tribe or individual Indian, or on land not subject to federal jurisdiction (“fee land”).  Knowing the status of the land will determine the permitting process and requirements.  Even though there is federal oversight, there may be benefits to siting on trust land because local land use restrictions will not apply (and because there may be tax benefits too!).  In this instance, it is important to understand the tribal law requirements and how those, often, coordinate with federal law requirements and understand the comparative requirements on fee-land.