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THE DAILY ASTORIAN • MONDAY, NOVEMBER 6, 2017
Ranching standoff trial a test of federal control
By KEN RITTER
Associated Press
LAS VEGAS — The abil-
ity of the federal government
to enforce its own land poli-
cies in the West will be tested
as a trial begins this week of
a Nevada rancher accused of
leading a 2014 armed standoff
with federal agents in a dis-
pute over cattle grazing.
Federal prosecutors in
Nevada have twice before
failed to win full convictions
at trial of men who had guns
during the tense confrontation
involving hundreds of pro-
testers who stopped govern-
ment agents from rounding
up cattle belonging to Cliven
Bundy.
In opening statements
Tuesday prosecutors will
accuse the 71-year-old Bundy,
sons Ryan and Ammon
Bundy, and co-defendant
Ryan Payne of enlisting a
self-styled militia to defy gov-
ernment authority.
“If they don’t convict the
Bundys, it will look like the
federal government can’t
enforce its own land policy,”
said Ian Bartrum, a Univer-
sity of Nevada, Las Vegas,
law professor following the
case closely. “The Bundys
and people like the Bundys
have been fighting this battle
for decades, and always lost.”
The standoff near Bun-
kerville, Nevada, about 80
miles northeast of Las Vegas,
became an iconic moment
in a decades-long turf bat-
tle between the government
agency assigned to manage
vast tracts in the Western U.S.
and ranchers whose cows
graze the land.
Bundy argues that his fam-
ily has used the same pub-
lic range for more than a cen-
tury — even before the 1934
Taylor Grazing Act set fed-
eral land policy. He maintains
the land belongs to the state,
AP Photo/Rick Bowmer
In this Jan. 4, 2016, file photo, Ammon Bundy, center, one of the sons of Nevada rancher Cliven Bundy, walks off after
speaking with reporters during a news conference at Malheur National Wildlife Refuge headquarters near Burns.
not the U.S. Bureau of Land
Management.
Defense attorneys say the
four men didn’t conspire with
anyone, didn’t wield weapons
and didn’t threaten anybody.
They cast the standoff as a
peaceful protest, with no shots
fired and no one injured before
overreaching government offi-
cials abandoned the cattle
round-up and went home.
“I think they’ll lose again,”
Bundy attorney Bret Whipple
said, pointing to the prosecu-
torial scorecard after trials that
ended in April and August:
Two defendants acquitted; two
defendants convicted of some
charges; two defendants now
free after pleading guilty to
misdemeanors to avoid stand-
ing a third trial. No one was
found guilty of conspiracy.
Acting U.S. Attorney Ste-
ven Myhre, the lead prosecu-
tor, declined to comment out-
side court last week.
During previous trials, he
has accused the Bundys of
trying to instigate a “range
war” against the government.
He said federal agents were
enforcing federal court orders
after Bundy racked up more
than $1.1 million in unpaid
fees and penalties letting
his cattle graze for decades
in what is now Gold Butte
National Monument.
The Bundys and Payne
have been jailed since early
2016. They remain shackled
at the ankles in court, but blow
kisses to family members in
the audience.
Each man refused to enter
a plea, saying he didn’t recog-
nize the authority of the gov-
ernment. A magistrate judge
entered not-guilty pleas for
each.
The men face 15 felony
charges that include assault
and threats against federal offi-
cers, firearms counts, obstruc-
tion and extortion. Stacked
together, convictions on all
charges carry the possibility of
more than 170 years in prison.
Oregon joins bid to collect online sales taxes
By JAMES NORD
Associated Press
SIOUX FALLS, S.D. —
Thirty-five state attorneys
general and the District of
Columbia this week signed
on to support South Dako-
ta’s legal bid to collect sales
taxes from out-of-state inter-
net retailers.
South Dakota is asking
the U.S. Supreme Court to
review whether retailers can
be required to collect sales
taxes in states where they lack
a physical presence. The case
could have national implica-
tions for e-commerce.
South Dakota Attor-
ney General Marty Jackley
said in a statement Thursday
that Colorado filed a friend-
of-the-court brief support-
ing South Dakota’s petition
to the high court. The state is
seeking to overturn legal rul-
ings issued mostly before the
online shopping boom that
AP Photo/James Nord, File
Republican South Dako-
ta Attorney General Mar-
ty Jackley speaks after
a committee hearing in
Pierre, S.D.
hamstring officials who want
to collect sales taxes from out-
of-state retailers.
“South Dakota is leading
the national fight to bring tax
fairness for our local retailers
and to help support main street
businesses,” Jackley said.
The support includes
neighboring Iowa, Min-
nesota, Nebraska, North
Dakota and Wyoming. The
other states are: Alabama,
Arkansas, California, Con-
necticut, Florida, Hawaii,
Idaho, Illinois, Indiana,
Kansas, Kentucky, Maine,
Maryland, Massachusetts,
Michigan, Mississippi, New
Mexico, New York, North
Carolina, Ohio, Oregon,
Pennsylvania, Rhode Island,
Tennessee, Texas, Utah,
Vermont, Washington and
Wisconsin.
The brief says the juris-
dictions all rely on consump-
tion taxes to fund essential
government operations.
States have pushed Con-
gress to address the issue
without success, and one
estimate put the loss to
states at roughly $26 billion
in 2015. South Dakota esti-
mates it loses about $50 mil-
lion annually to e-commerce.
“The problem with the
physical-presence rule is that
it was first conceived of in
1967, two years before the
moon landing and decades
before the first retail transac-
tion occurred over the Inter-
net,” according to the brief.
Some companies such as
Amazon have decided to col-
lect state sales taxes despite
the precedent.
South Dakota legislators
passed a law last year requir-
ing collection of the tax. The
law was struck down in Sep-
tember by the state Supreme
Court due to precedent. The
state had welcomed the defeat
so it could try to get the U.S.
Supreme Court to take up the
case.
It takes four U.S. Supreme
Court justices to vote to hear a
case, or grant certiorari. Jack-
ley said that he hopes the high
court agrees to hear the case
and issues a decision by June
2018.
Proposed federal plan could affect Oregon state taxes
By CLAIRE
WITHYCOMBE
Capital Bureau
SALEM — Oregonians
generally could pay more in
state income taxes under the
new federal tax reform plan
unveiled last week by U.S.
House Republicans.
The plan faces uncertain
prospects, but one proposed
change could disproportion-
ately affect Oregonians — its
provision largely eliminating
federal deductions for state
and local income and sales
taxes.
For Oregonians, who pay
income taxes that are high
compared to other states,
doing away with most of that
deduction could mean higher
federal taxes, because there
would be more money to tax.
A comparison of personal
income tax rates by the Fed-
eration of Tax Administrators
ranked Oregon with the sec-
ond highest tax rate, 9.9 per-
cent, behind California.
In 2015, Oregonians
deducted about $5.9 billion
in state and local taxes from
their federal taxes, according
to the nonpartisan Legislative
Revenue Office. About $2.5
billion of that was in property
taxes.
Under the GOP plan, tax-
payers could still deduct prop-
erty taxes, but the deduction
would be limited to $10,000.
Oregonians can also
deduct their federal taxes
from their state taxes in what
is called a “rolling reconnect.”
“If you pay less in federal
taxes, then you have less fed-
eral taxes to subtract or deduct
from your state taxes,” Legis-
lative Revenue Officer Paul
Warner said. “That means
if you get a $100 decrease
in your federal taxes, that’s
$100 less you can decrease
from your state taxes.”
In the current two-year
budget, the amount of tax
dollars that state govern-
ment forgoes due to federal
deductions from state taxes
is expected to be about $924
million, Warner said. If fed-
eral taxes Oregonians pay
are lower, that number could
shrink too.
But the proposed changes
to deductions may not nec-
essarily mean higher taxes
altogether. The bill also pro-
poses a broad range of adjust-
ments to federal taxes, such
as increases in the standard
deduction and the child tax
credit.
What you pay will
depend on a number of fac-
tors, including how much
you make, where you live,
whether you itemize your
deductions or opt for the stan-
dard deduction, and whether
you are planning to buy a new
home.
The plan also shrinks the
number of individual income
tax brackets from seven to
four.
The “Tax Cuts and Jobs
Act” would also:
• Create a new 25 percent
tax rate for pass-through busi-
nesses, such as sole propri-
etorships, partnerships and S
corporations.
• Reduce the corporate tax
rate from 35 percent to 20
percent.
• Eliminate the estate tax
after six years.
• Reduce the loan cap on
the home mortgage interest
deduction from $1 million to
$500,000, and eliminate the
benefit altogether for second
homes. The bill preserves the
$1 million cap for existing
mortgages.
That could affect those
who own more than one prop-
erty and people who buy
homes in Oregon’s boom-
ing metro areas, where home
prices are higher, Warner said.
“I think we’ll see some
adjustments as the process
goes on,” Warner said.
Oregon relies heavily on
the state income tax for its rev-
enue; the impact on state and
local deductions and on bond-
ing in the plan was roundly
criticized by State Treasurer
Tobias Read, a Democrat.
Read’s office said in a
press release that the plan
would also cut access to tax-
free bonds that are used to
finance affordable housing
and other economic develop-
ment projects in Oregon.
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The April 2014 standoff
was a precursor to an early
2016 protest in rural east-
ern Oregon, where Ryan and
Ammon Bundy and Payne led
a 41-day takeover of a fed-
eral facility and called for the
U.S. government to turn over
public land to local control.
No one disputed the men
occupied the Malheur Wild-
life Refuge. But a federal jury
in Portland refused to con-
vict Ryan and Ammon Bundy
of any crime. Payne pleaded
guilty before trial to felony
conspiracy to prevent Inte-
rior Department employees
from doing their jobs, but is
fighting to withdraw his plea
and his expected sentence
of more than three years in
prison.
The proceedings in Las
Vegas are shadowed by the
Oct. 1 shooting deaths of 58
people at a Las Vegas Strip
open-air concert by a man
who opened fire with rap-
id-fire assault-style weapons
from the 32nd floor of a high-
rise hotel.
The judge agreed after the
massacre to delay start of the
Bundy trial by three weeks.
Gregg Cawley, a Univer-
sity of Wyoming professor
who has written about land
protests in the West, said the
jury may be skittish about
testimony about guns.
“There are going to be
jurors who are predisposed to
the idea that the simple pres-
ence of a gun is a threat,”
Cawley said. “And the (Oct.
1) shooting will be fresh in
their minds. I don’t know
how you erase that.”
Myhre points in court to
the fear that outnumbered and
outgunned federal agents say
they felt during the standoff.
But Myhre couldn’t con-
vince juries to convict Eric
Parker and Scott Drexler,
two defendants photographed
during the standoff pointing
rifles toward heavily armed
federal agents in a dry river-
bed below. After two mistrials
on felony charges, both men
pleaded guilty last month to
misdemeanor obstruction of a
court order.
Bartrum said the current
jury in Las Vegas could follow
its predecessors and reject or
“nullify” calls to convict the
Bundys and Payne in the trial
that is expected to last four
months.
“In this climate, in Nevada
and the West, there’s a strong
ethos and popular feeling of
resentment toward the idea of
federal land ownership and
overreach,” Bartrum said.
OHA may owe feds $64
million for payment errors
By PARIS ACHEN
Capital Bureau
SALEM — The Oregon
Health Authority may owe
the federal government up
to $64 million for erroneous
payments it made over three
years because of an error in
the Cover Oregon website,
according to OHA.
The failed website,
which was used by state
agencies but never launched
to the public, miscatego-
rized people eligible for
both Medicare and Medic-
aid, according to Gov. Kate
Brown’s office. The mis-
take resulted in OHA mak-
ing $74 million in overpay-
ments to Coordinated Care
Organizations for patients
eligible for both Medicare
and Medicaid from 2014
to mid-2016. The miscate-
gorization resulted in Ore-
gon receiving excess federal
funding for that dual-eligi-
ble population.
OHA was able to recoup
$10 million of the overpay-
ments from CCOs in 2016
but lacked a mechanism to
recover the excess amounts
paid out in 2014 and 2015,
said Robb Cowie, an OHA
spokesman.
The problem was known
for some time but was not
publicized until after Pat-
rick Allen took the helm
of OHA two months ago.
Brown selected the former
head of the Department of
Consumer and Business
Services to lead OHA after
former Director Lynne Sax-
ton resigned in August amid
a scandal over a conspir-
acy to plant negative news
about a Portland-area Med-
icaid provider.
When the new leader-
ship took over, employees
brought the miscategoriza-
tion issue to the agency’s
new chief financial officer,
Laura Cali Robison, and
identified it as “a problem
to be dealt with,” Allen said.
“It was one of the echoes
of one of the problems with
Cover Oregon,” he said.
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