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NESPELEM – A Colville Tribal Court lawsuit over state fuel tax revenue was decided May 25 in favor of the tribe.

Two convenience store and gas station owners sued the tribe over its practice of collecting state fuel tax from non-tribal members who purchase fuel on the reservation, with “a significant portion” coming back to the reservation to finance reoad improvements and maintenance, said a tribal announcement.

Gene Nicholson of Gene’s Native Smokes and Michael Finley of the Inchelium Short Stop sued in January 2021, alleging the tribe collected the tax unlawfully and owed them more than $800,000.

Colville Tribal Court dismissed Nicholson and Finley’s lawsuit in regard to fuel tax issues and ruled Nicholson and Finley violated tribal law during the past year by refusing to pay and collect the taxes as required by law.

The court ordered them to comply immediately paying and collecting the proper fuel taxes.

“The Colville tribes is dedicated to the fair and full enforcement of its law and regulations,” said Colville Business Council Chairman Rodney Cawston. “No one is above the law, and the tribes will not allow any individual to damage the tribal community as a whole to benefit themselves. This lawsuit was always without merit and we are proud that the tribes’ sovereign law is properly enforced on our tribal land.”

Under an agreement between the state and tribe, tribal fuel retailers can purchase only from tribally approved suppliers, but Finley and Nicholson apparently were buying from a non-approved distributor. They then are supposed to charge tax on sales to non-members, keep a portion and remit the rest to the tribe.

The state can tax the distributor but not the retailer.

Finley, a former business council member and chairman, is seeking election to the council from the Inchelium District in the June 19 general election.

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