Chapter twenty of “Where the Salmon Run” written by Trova Heffernan and sponsored by Washington Secretary of State Sam Reed.
Frank’s Landing is located in Nisqually, Washington, at an interchange of Interstate 5, near Norma’s Burgers, a popular lunch joint, and Schilter Family Farm, where 180 acres of Christmas trees, pumpkins, and pasture lands spread out, paralleling the freeway.
A smoke shop at the Landing operates from a nondescript beige building, bearing the simple sign: “The Landing, A Skookum Creek Outlet.” On any given day, you’ll find cars pulling up slowly to the drive-through window, where drivers place orders for soft drinks, candy, or cigarettes.
Sometimes, you’ll hear shrieks of laughter from nearby Wa He Lut Indian School, the Native cultural center founded by Billy’s older sister, Maiselle, in response to children’s experiences in public school.
This community is steeped in history, dating back to Muck Creek Village on the Nisqually Indian Reservation where Billy’s father grew up. A century earlier, Indians gathered and traded goods at the village, then a major tribal center on the south side of the creek. When the Nisqually Reservation was condemned during World War I, displaced Indians at Muck Creek Village scattered. Among them was Billy’s father, who lost his allotment. He eventually bought 6.3 acres of land near the mouth of the Nisqually River. A new community emerged with a sawmill, a blacksmith’s shop, a fish landing, and a trading post.
Over the years, multiple generations of the Frank family have lived on the property. The parcel of land became known as Frank’s Landing after Billy’s father. The smoke shop supports the family and supplies a reliable revenue stream for the school and Indian causes.“We [the families] don’t get no federal money of any kind,”Billy explains. “That was our income, that smoke shop. And so that was all taken away.”
The sale of cigarettes on Indian land has long been disputed. In Washington v. The Confederated Tribes of the Colville Indian Reservation (1980), the U.S. Supreme Court held that even on Indian land, states could impose taxes on cigarettes sold to non-Indians. At the time the high court issued its ruling in the Colville court case, cigarette profits were bringing in a much-needed forty thousand dollars to Frank’s Landing every year. Billy characterized that verdict as another tactic by the federal government to bring down the Indian people. “This is the way the United States government works,” he told a reporter. “They’re trying to push us back into the ground. We’ve come out of shacks into trailer houses. We might have to go into the shacks again.”
“There will be very deep hurt as a result of this,” agreed Ronald Andrade of the National Congress of the American Indians in 1980.
To avoid further legal disputes, the state of Washington and Indian tribes considered establishing compacts—mutually agreeable terms under which cigarettes could be sold on Indian land. Alison Gottfriedson, Billy’s niece, took part in a two-year study. “Alison was one of the two Indian members of a state study commission on tax losses and Indian cigarette sales,” explains Hank Adams. “That was under Senate Majority Leader, Sid Snyder, and Brian Thomas. They came up with the original proposals for the compact. . . . One [option] was to just repeal all laws restricting Indian sales of Indian, untaxed cigarette sales.” Generally, tax-free cigarettes may be sold on Indian land only to enrolled members of the same tribe. Who is buying, who is selling, and where the cigarettes are manufactured can all dictate whether a tax is imposed. Even in Indian Country, Indian retailers must impose a tax if cigarettes are sold to non-indians. Because of the friction this has caused between the state and Indian tribes, Washington law gives the governor authority to enter into agreements with certain federally recognized Indian tribes that allow the collection of tribal taxes instead of state and local sale and use taxes. All packs of cigarettes must bear a stamp of some kind that acknowledges a state tax, a tribal tax, or a tax exemption.
The state insists on a tax, in part, to level the playing field between Indian and non-Indian cigarette sellers. Moreover, the tax brings in considerable revenue. Washington smokers pay among the highest taxes in the country. (In 2011, consumers paid more than three dollars in taxes for a single pack of twenty cigarettes.) In 2009, the cigarette tax generated almost $400 million in revenue for the state of Washington.
Federal agents carried out Operation Chainsmoker in 2007. Brandishing search warrants and weapons, they raided shops and private homes in Washington and Oregon.
“They started a task force in Eastern Washington,” Billy explains. “They were going to bust Montana and Idaho—cigarettes coming across the border. They put all these federal people on that task force. Then, they picked up our name over there somewhere—the Landing transporting cigarettes. We always bought our cigarettes from Idaho, from the Nez Perce, and the different Indian tribes. We always traded with them. They’d been watching us all of this time, and they come down and raided us that day.”
Federal agents converged on Frank’s Landing and accused shop owners Hank and Alison Gottfriedson of selling contraband cigarettes to non-Indians. “atf takes these investigations very seriously,” said Kelvin Crenshaw, a special agent. “We are letting the criminal element know we are here, we are watching and we will not tolerate it.”
Billy, hours away at the Lummi Reservation in Bellingham, got the call: “The Landing is being raided by the federal firearms and tobacco people!”
Agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives seized more than fifty thousand cartons of cigarettes from the smoke shop that day. “They confiscated everything, cleaned the whole place out,” Billy recalls. “I told everybody that the Landing is being raided. At that same time, they were raiding the Swinomish Tribe.”
“They seized between one and two million dollars worth of cigarettes,” Adams estimates. “They confiscated about one half million dollars in cash from the smoke shop and from the safe at home. . . . They went to Billy’s niece, Alison Gottfriedson’s house, at gunpoint, and took the granddaughters in their pajamas out on the front lawn. Alison and Hank Gottfriedson were [both] under gunpoint and under arrest out on the lawn. And then [they] took Hank Gottfriedson into the house, just to help locate things so that they wouldn’t destroy the house altogether, hunting for things.”
“They scared the heck out of my grandkids,” Alison recalls. “They took both the computers and they trashed the whole house.”
Billy says the federal raid violated a treaty right to trade freely on Indian land. “We always contend that we don’t pay tax. We are exempt from any tax, state tax. What the feds did is they come down on the Landing using state law. They made the raid on the Landing based on charges of not paying tax, laundering money. We’re renegades, and the Landing puts 108 people to work every day, that’s the school and the smoke shop.”
“We didn’t have no compact with the state of Washington? We’d been negotiating for two years on a compact with the state of Washington!” the elder says in exasperation.
Adams says at the time of the raid, the Frank’s Landing Indian Community had indeed entered into discussions with the Washington State Department of Revenue to resolve outstanding issues surrounding cigarette sales. “We were meeting episodically, either at Frank’s Landing and the Wa He Lut School, or at the Department of Revenue, from 2006 right up until the day of the federal raid.”
As a result of the raid, the smoke shop at Frank’s Landing shut down for eight months. The family hung cardboard signs in front of the store calling the raid and seizure illegal.
Hank and Alison Gottfriedson were charged with “conspiring to traffic in contraband cigarettes and structuring currency transactions,” and pleaded guilty on a negotiated plea. As part of their sentence, they were ordered to pay more than $9 million in back taxes and “agreed to forfeit more than $1.5 million in cash.” As U.S. District Judge Benjamin Settle handed down the decision, he recognized Alison’s prominent standing in the community.
Adams says the Gottfriedsons had good reason to negotiate a plea. “They threatened to indict her mother, Maiselle, and Billy, a whole bunch of people. . . . Their sentences were issued in February of 2009, and it was no jail time, some community service, and no home monitoring, in other words, no ankle bracelets. So it was no jail, but it was forfeiture of all seized product and moneys.”
There’s no difference between the fight for fishing rights and the fight for the right to sell goods and services tax-free on Indian land, Billy told a journalist. “They say Alison owed $9 million, but she didn’t owe a dime. The federal government violated our sovereign rights. . . . The way things are now, there’s nothing to say that our kids won’t go to jail, just like Alison did. There’s fishing and there’s taxation, but it’s the same issue.”
The state of Washington amended a tobacco agreement with the Sqaxin Island Tribe and Frank’s Landing that governed the taxation of cigarettes. The Frank’s Landing smoke shop reopened after the raid under the amended compact. The Landing holds a unique designation under federal law as a “self-governing Indian Community” that allowed the agreement to move forward. The community at the Landing has included members of all Medicine Creek Treaty tribes: the Puyallup, the Nisqually, and the Squaxin.
“The Congress acted in 1987 to establish that the Frank’s Landing Indian Community is eligible for the Federal programs and services that are provided to Indians because of their status as Indians,” explains Patricia Zell, an attorney who handled the legislation, “and that the Community is eligible to enter into contracts with the United States under the authority of the Indian Self-Determination and Education Assistance Act. In 1994, the Congress further amended the 1987 law, to make clear that the Frank’s Landing Indian Community is a selfgoverning dependent Indian community that is not subject to the jurisdiction of any Federally-recognized tribe, with the provisos that the 1994 amendment does not alter or affect the jurisdiction of the state of Washington nor does the amendment constitute the recognition of the Community as a Federally-recognized tribe and that the Community shall not engage in any class III gaming under the authority of the Indian Gaming Regulatory Act.” After the smoke shop reopened, the Nisqually Tribe claimed jurisdiction over Frank’s Landing and sued the state for amending its compact with the Squaxin Island Nation. Conflict between the Nisqually Tribe and the Landing is nothing new. Billy has often walked a tightrope with the tribe. “Our issue is not with Frank’s Landing,” insists Nisqually Chair Cynthia Iyall. “It’s not with their smoke shop. It never has been. That smoke shop has been there for twenty-five years, and we’ve never had an issue with the smoke shop. We support the fact that they’ve been able to run that smoke shop.
“Our issue is with Washington State and the very fact that our tobacco compact . . . shows [the] Nisqually Indian Reservation including Frank’s Landing. Frank’s Landing is a part of the Nisqually Indian Tribe. When Governor [Christine] Gregoire decided it was okay to sign an amendment that allowed Squaxin Island to come onto our reservation, collect taxes, collect revenue for their tribe, that is a breach of contract, and that’s our squawk.”
“Understand our position as a tribe with Squaxin Island coming in and collecting on our reservation,” continues Iyall. “If they’re going to do that with tobacco tax, does that mean then that Governor Gregoire is going to amend our fuel compact, and our gaming compact allowing a casino down in the valley to cut us off? That’s what I’m talking about.” The case climbed to the Ninth Circuit Court of Appeals and was resolved in favor of Frank’s Landing.
“The way I look at it is that it all has to deal with money,” says Willie III who currently serves the Nisqually Tribe as vice chairman. “It’s all about cigarettes. It’s about power. It’s about control. In 2007, we got our smoke shop raided. atf came down. They said we were selling unmarked cigarettes, untaxed cigarettes, and that we needed to figure out our own compact with the state. Before the raid, we were trying to set up our own compact with the state. We were trying to get our own compact with the governor and the state, to go in and sell cigarettes down there like we’d been doing for thirty years. So, 2007 comes and we get raided. Come to find out, Nisqually [Tribe] was the reason we got raided in ‘07. They sent numerous letters to the Department of Revenue talking about how we’re selling unstamped cigarettes down there.”
Any friction between the Frank’s Landing Indian Community and the tribe doesn’t appear to bog Billy down. “In my mind, I don’t hold any grudges,” he says.
“That’s what gets me about the whole situation is that he doesn’t hold a grudge,” Willie III says. “He’d still do anything for these guys. If they asked him to do something, he’d do it. If they asked him to be a speaker somewhere, whatever it may be, he’d drop everything and do it. It’s just the kind of person he is. I’ve told him that a number of times, ‘That’s one thing I admire about you, Dad, because I wouldn’t be able to do that.’“ “
For three years we’ve been negotiating with the state, the Department of Revenue, and all them. It’s just another battle in the life of the Landing,” Billy says, shaking it off.
Next: Hard Truths
Chapter Twenty | Operation Chainsmoker added by Trova Heffernan on
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