Leonard Albrecht, et al. v. Riverside County, California, et al.

Although this Court has made clear that federal law preempts state and local governments from imposing real-property taxes on Indian lands, some of those governments have levied those very taxes on the leasehold interest when the lands are leased to non-Indians. There is sharp disagreement among the lower courts about whether those taxes are also preempted. The Eleventh Circuit and the Department of the Interior have concluded that they are preempted—while the Ninth Circuit and (in this case) the California courts have found such taxes not preempted. In areas where commercial development has extended to reservation lands, the Ninth Circuit and California position deprives Indian tribes of a major part of their tax base—crippling tribes’ ability to govern their own reservations. The questions presented are:

1. Do the federal regulations governing the leasing of Indian lands preempt state and local governments from taxing the leasehold interest conveyed by the regulated leases?

2. Does the express preemption provision of the Indian Reorganization Act of 1934—which prohibits state taxes on “any interest in lands” that the government “acquire[s] pursuant to this Act … in trust for [an] Indian tribe or individual Indian”—apply when the government acquires extended trust rights pursuant to the Act?