In the final days of 2018 the President signed into law H.R. 5317 repealing the pre-Civil War prohibition on certain alcoholic beverage manufacturing on Indian lands.
I the parlance of the early 19th century the bill repeals a prohibition on creating or continuing a distillery in Indian country for manufacturing ardent spirits, when it almost cryptically provides, “Section 2141 of the Revised Statutes (25 U.S.C. 251) is repealed.”
The now repealed 1834 law was one of the Indian Trade and Intercourse Acts enacted in the 18th and 19th centuries. The law has its origins in legislation pursued by President Thomas Jefferson in 1802 banning all alcohol in Indian country.
The purpose of the 19th century laws was to regulate non-Indian interaction with individual Indians and Indian tribes on Indian lands. While the operation of the Trade and Intercourse Acts has been repealed or superseded by subsequent laws, several of them, including the one prohibiting distilleries on Indian lands, remained in effect through 2018.
The Indian Trade and Intercourse Acts reserved to the United States the exclusive right to acquire Indian lands and to regulate and restrict trade with tribes.
The early 19th century acts were intended to implement and enforce the terms of Indian treaties against “obstreperous whites, [and] gradually came to embody the basic features of federal Indian policy” to preserve peace on the frontier, including by imposed restrictions on the sale, exchange, or barter of spirituous liquors to Indians in Indian country.
Section 21 of that Act provides that if any person sets up or continues a distillery for the manufacturing of ardent spirits in Indian country, the penalty shall be $1,000 and the superintendent of Indian affairs shall destroy and break up the distillery.
Most of the 1834 law remained in effect until 1953 when Congress passed the last of six Indian termination acts to eliminate historical discriminatory legislation against Indians in the United States. Under the 1953 law, the production and distribution of liquor is permitted in Indian country subject to the laws of the State in which such acts or transactions occur, and subject also to tribal ordinances approved by the Secretary of the Interior.
Nonetheless, because the 1834 law imposing express restrictions on distilleries in Indian country remained in effect, there was a question whether a tribe may lawfully construct and operate a distillery on its reservation even though it may be permitted to build and run a brewery or winery.
The 1834 law expressly prevents any tribe from hosting a distillery project on its lands. While the law may have advanced a valid public policy goal in the mid 19th century, or not, it is not compatible with the modern policy of promoting tribal self-determination and economic diversification on Native American lands where existing laws provide reasonable regulation of liquor transactions.
The bill was especially supported by the Confederated Tribes of the Chehalis Reservation, which plans to construct and operate a distillery and restaurant on its lands. According to the Tribe, the project, part of a larger brewery, distillery, and restaurant project, will be wholly tribally owned and operated, with net profits going to the Tribe.