Passamaquoddy Tribe makes nearly $60,000 payment to Washington County, ends lawsuit

Posted June 16, 2014, at 7:01 p.m.

BANGOR, Maine — A federal lawsuit filed by Washington County to collect payments from the Passamaquoddy Tribe at Pleasant Point was dismissed Monday after the tribe paid in full nearly $60,000 it owed to the county.

The lawsuit was settled in mid-May, but details of the settlement were not outlined in documents filed in U.S. District Court.

The tribe agreed to pay monies owed to the county dating back to 2006 within 10 days of the settlement being reached, Pleasant Point Passamaquoddy Chief R. Clayton Cleaves said Monday. But the tribe ran about seven or eight days late before making payment in full the first week in June, he said.

The payment amount totaled $58,221.93, according to Cleaves and County Manager Betsy Fitzgerald.

Washington County filed the l awsuit in federal court against the Passamaquoddy Tribe in November 2012, alleging the tribe had not made any property related payments to the county — either in the form of taxes or as a payment in lieu of taxes, also known as a PILOT — since 2006.

The county claimed in its lawsuit that it is authorized by the Maine Indian Claims Settlement Act of 1980 to collect PILOTs from the tribe based on all of the Passamaquoddy real estate and personal property in Washington County.

PILOTs typically are made by nonprofit organizations to municipalities or other governments in recognition of the impact those organizations have on governmental services. Nonprofit organizations are exempt from paying property taxes under federal law.

“PILOTs are not defined in dollar amount,” the suit states, “but rather are to be in an amount equal to that which would otherwise be imposed by a county, a district, a state or other taxing authority.”

Tribal leaders believed the county was improperly assessing taxes, according to Craig Francis, an attorney for the Passamaquoddy, and they stopped making payments in 2006. County officials began characterizing the payments as in lieu of taxes in 2011, he said.

As part of the lawsuit settlement, the tribe agreed to continue making payments to the county, Cleaves said. The payments amount to a little more than $7,000 annually.

Late charges, penalties and other costs were dismissed, Cleaves said.

“I appreciate the cooperation of the tribe in settling this outstanding issue and have every expectation that we will be able to work cooperatively going forward,” Fitzgerald said.

The tribe lost its case, Cleaves conceded, but Francis disputed the chief’s statement.

“It really wasn’t a win or loss for anybody,” Francis said. “The case was never litigated.”

Cleaves said he was disappointed with the outcome “because we’re pinching pennies. We’re struggling to survive on the reservation.”

Unemployment on the reservation exceeds 60 percent, except during the summer when a federal job program reduces it to about 49 percent, he said.

Cleaves also referred to a bill that failed in the recent session of the Maine Legislature that would have allowed Washington County voters to decide whether the tribe could have slot machines, and he mentioned a running dispute the tribe has been engaged in with the state Department of Marine Resources over fishing for baby eels, known as elvers.

“We’re pinching pennies all the way through my administration,” Cleaves said.

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