REVENUE : Where Custer Last Stood, Businessmen Vow to Fight Tribal Tax : Some targets of Crow agency’s resort levy threaten violence if compelled to pay. Both sides vow a legal battle to the finish.

A few hundred miles south of the ranch where the anti-government “freemen” were surrounded by the FBI, another potentially explosive standoff has emerged between Crow tribal leaders and non-American Indian businesses refusing to pay a resort tax.

Several of the businesses, situated on patches of private land within the sprawling reservation, recently received final notices: Pay the tax now or risk seizure and sale of property at any time.

With both sides vowing to go all the way to the Supreme Court, this fight could determine a tribal nation’s authority to levy such taxes--and could prove to be as historically definitive as Custer’s Last Stand, which took place here 120 years ago.

Among those vowing to resist the Crow leaders, with violence if necessary, are Christopher Kortlander and James “Putt” Thompson, whose Custer Battlefield Trading Co. sits on a hill overlooking this impoverished village of small homes, reservation and government offices, and schools.

“If they plan to seize one of our locations, we are not going to hand it over on a silver platter,” said Kortlander, who moved here after losing his home in the Malibu fires of November 1992.

“We’ve already had the Unabomber and the freemen standoff in Montana. This will be crisis No. 3,” he said. “It will be another interesting day in Montana.”

A spokesman for the Big Horn County Sheriff’s Department said: “We’re keeping an eye on the situation and trying to keep the lid on.”

The 4% resort tax on goods and services used mostly by tourists and sold by non-Indian business owners on the reservation was imposed in April to offset cuts in federal funds for Indian tribes.

Opponents, including Sen. Conrad Burns (R-Mont.), have called it taxation without representation and “a Band-Aid tax to increase reservation revenues.” But tribal authorities argue that the power to tax is a crucial instrument of self-government, territorial management and even survival.

In what has become a racially tinged battle that is polarizing communities, non-Indian business owners are learning a daunting lesson about the volatility of Native American politics and policy, which can change as quickly as the weather in these parts.

For tribal leaders, it is another in a series of painful, costly attempts to exercise sovereignty rights amid ambiguous court rulings and federal regulations in a place where even the definition of “Indian land” is murky.

So far, the tribe has filed liens against 13 holdout businesses, including the Big Horn County Historical Society, a nonprofit organization that operates a tiny gift shop whose revenue supports the county museum.

Angered by what they view as an act of hostility toward white business owners and a burden on customers, some of the business owners have formed an association and filed a lawsuit to overthrow the tax. Others are paying the tax under protest and have asked for a hearing before the tribal tax commission.

Thompson and Kortlander flatly refuse to pay under any conditions.

“This is the biggest farce I have ever seen, and I’m not paying,” said Thompson, who sells Native American blankets, war bonnets and beadwork as well as T-shirts, polished stones and postcards he calls “Custer crap.”

“The tribe sent a letter to my bank saying their tax lien will come before my loans,” he said, referring to a lien filed against his property for $109,000 in taxes, penalties and interest. “I think that is racketeering. It’s a way for them to get back at the white man.”

Denis Adams, the tribe’s tax commissioner, said that if it takes five years to resolve litigation in favor of the Crow, and Thompson makes no payments in that time, the accumulated liens will be in excess of $800,000.

Kortlander, who collects and sells historical documents and owns a museum and trading post beside the tomb of one of the first soldiers to die at Little Bighorn, is trying to drum up help from county, state and federal officials who “represent my government, the United States.”

At his request, Burns’ office has asked U.S. Atty. Gen. Janet Reno to dispatch FBI agents to protect the businesses from any attempt to seize property.

“I’m pro-Indian, but the current Crow administration is out of control,” Kortlander said.

Sipping coffee in a trailer near the reservation headquarters, Crow Chairwoman Clara Nomee said she is saddened by the uproar over the resort tax, especially in a state that does not have a sales tax.

“I pray about this every day. It seems they want the world to believe we are renegades. We are not,” Nomee said. “Somehow they don’t understand that we have got to survive, that we have American dreams too.”

Many Native American reservations have serious problems. But the Crow, who live in a vast expanse of grassy hills and river valleys, are in worse shape than most. The reservation is littered with the ruins of failed business developments brought in over the years by federal officials. The unemployment rate is about 70%, and the annual per capita income is about $5,000, tribal leaders say. Alcoholism is rampant.

In a situation that has been compared to “feudalism in reverse,” the Crow control only about 51% of their reservation’s 2.2 million acres. The rest has been bought or leased over the years by non-Indian ranchers, farmers, corporations and small businesses that cater to tourists.

Much of the blame for the tribe’s economic problems can be assigned to federal mismanagement, broken treaties, racism and greed by whites. But also at work are factors deeply rooted in Crow tradition and life that well-meaning white business owners wish they could change, but cannot.

For one thing, money and material wealth is not as meaningful to the Crow as family ties and clan relationships. That fact is evident in Crow celebrations in which individuals living on federal subsidies give away armloads of clothes, blankets or tools to friends and relatives.

Seemingly this anti-capitalist philosophy leaves the Crow at a disadvantage against white businesses geared toward making a profit.

Tribal authorities, for example, are unhappy with Thompson, who buys beadwork from Crow artists and then sells it for double or triple his costs. They see it as exploitation. Thompson says he is being a good businessman.

“I’m in a tourist area. That’s what you do--mark things up,” he said.

Nonetheless, Nomee said, at a time of reduced federal dollars, the tribe is in desperate need of a juvenile detention center and a foster care facility. It also hopes to build its own businesses on the reservation, perhaps on some of the land that may be vacated by non-Indian tax protesters.

“We are only trying to take back some of the things that were taken from us illegally or too cheaply,” she said. “So we have started taxing. Why not? Taxation is the livelihood of a government.”

Kortlander and Thompson have offered to sell their properties, for the right price.

“Everybody has their price,” Kortlander said, directing work crews landscaping the front of his rustic-looking trading post.

“I didn’t build this place to sell it to the current administration. But if they don’t want me here that badly, it will have to be for a dollar amount I can live with, walk away and never look back.

“Then again,” he added with a smile, “I’d love to advise this tribe on business matters.”