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America's Micmac Indians push for self rule

By Jason Szep

PRESQUE ISLE, Maine, April 28 (Reuters) - Like many of his Native American ancestors, Steve Phillip knows a thing or two about battles.

He fought in the Vietnam War, waged a fight with alcoholism that nearly killed him and survived near poverty in rural northern Maine where his father picked berries for a living.

Now, the 58-year-old is one of about 1,000 Micmac Indians fighting for self rule -- which would free them from state laws and taxes -- in a case that illustrates tensions between state authority and Native American sovereignty in New England, where land disputes fester nearly 400 years after European settlers sailed into Massachusetts.

In December, a federal magistrate struck down a 1989 Maine state act that would have subjected the Micmac tribe to Maine laws. Maine appealed in January and a trial is pending in the the 1st U.S. Circuit Court of Appeals in Boston.

"Every time we go into court I come away feeling a little better," said Phillip, a stocky former potato farmer who is the tribe's vice chief, from his reservation on an abandoned air force base in Presque Isle, a city of about 9,500 people.

The legal tussle with Maine, which could pave the way for Micmac-owned tobacco shops, casinos and other businesses free from state taxes, comes as Indian tribes nationwide are witnessing unprecedented economic development.

"There's a boom going on Indian country," said Joseph Kalt, chair of Harvard University's Native American Program, which found that between 1990 and 2000 Native American incomes grew three times faster than the U.S. economy as a whole.

"What you are starting to see is a fairly thick economic development across reservations with more and more tribes able to support retail sectors, more and more tribes engaging in successful manufacturing enterprises and other mainstream businesses," said Kalt. "The most surprising statistic of all, it just knocked our socks off, is that the tribes without gaming are also growing three times faster."

ELUSIVE PROSPERITY

For many tribes, greater autonomy began with federal legislation in the 1970s. The 1990s saw rapid development of tribal court systems, police departments, tax codes, state-of-the-art water treatment plants and health clinics.

Native American incomes still lag the national average, but many tribes are developing golf resorts, expanding power plants and exploring new businesses.

Maine's Micmacs, whose nomadic ancestors arrived in eastern Canada and the northern U.S. corner about 10,000 years ago, say they want a slice of that prosperity to relieve chronic unemployment. About 80 percent of the tribe is out of work.

They were excluded from an $81.5 million Indian settlement act in 1980 in Maine that gave federal services and money to the state's three other tribes. Their Canadian roots and nomadic history made it hard to prove land claims in Maine.

The bulk of an estimated 20,000 North American Micmacs -- also spelled Mi'kmaq -- live in Canada.

But in 1991, Maine's Micmacs were federally recognized, gaining them access to free medical care, housing, education and food subsidies. Traditions like basket-weaving and the nearly forgotten Micmac language have seen a revival in Maine.

Their population has nearly doubled.

"We are getting our culture back," said Steve Phillip's bother-in-law Paul Phillip, a 67-year-old former tribal chief. "It's so much better than it was. No one is hungry here now."

Winning in court, he said, would give young, better educated Micmacs reason to stay with the tribe in Maine, which lost more jobs than every American state except Mississippi, Michigan and Louisiana in the final quarter of 2005. "Gaming will help a lot financially. We could also buy lumber mills."

LEGAL CHALLENGES

The tribe wants the court to assert what it considers fundamental principles of tribal self-rule. This boils down to freedom from state laws and taxes, an autonomy held by many of the nation's 561 federally recognized tribes.

The legal fight with Maine began in 2001 when three women fired by the band complained to the Maine Human Rights Commission, which ruled in the women's favor. The tribe went to federal court, claiming that because it was a sovereign nation, the commission, a state agency, had no jurisdiction.

"We're arguing that a tribe retains all its rights unless Congress expressly and explicitly removes them," said Douglas Luckerman, the tribe's lawyer who also represented the Wampanoag and Narragansett tribes in similar New England cases.

Maine Attorney General Steve Rowe says he is concerned the Micmacs could wind up exempt from an unknown number of state laws.

Other tribes are also facing difficult negotiations and legal challenges in New England, including the Mashpee Wampanoags which won preliminary recognition in March but face tough talks in Massachusetts over the right to build a casino.

Luckerman compares Maine's case to a ruling last May by the 1st U.S. Circuit Court of Appeal which said Rhode Island violated the Narraganset Indian tribe's sovereignty when state police raided a tax-free tribal smoke shop, seized cigarettes and arrested tribal leaders in July 2003.

The state has appealed. He said all these cases need to be resolved so investors can feel confident that when doing business with New England's tribes that they know which rules -- state, federal or in some cases tribal -- apply. "You can't attract any kind of significant investment money that is going to be there for the long term if you can't give them some kind of stable legal environment," he said.

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