HOULTON – The Town Council at its meeting Monday night voted to take $65,000 from the undesignated fund balance to cover the cost of continued litigation with the Houlton Band of Maliseet Indians, even as some members suggested that it was time to end the dispute.

Several councilors expressed concern that the controversy over the Maliseet Housing Authority’s payment of taxes to the town had gone on long enough and that the town should take steps to end the conflict, which has included two lawsuits filed by the tribe and its housing authority in federal district court.

“As a councilor, I would hold out my hand to the tribe and the housing authority to suggest that at some point, we all ought to sit down and talk further,” Councilor Michael Carpenter said.

Others held similar views.

“It’s just too bad that stupidity and stubbornness have gotten us to the point where we’re going to be spending another $65,000,” Councilor Paul Clearly said. “My personal opinion is I don’t think we opened our arms up wide enough [to the Maliseets] and said, ‘Come on in and let’s talk,'” he continued, suggesting that the tribe sued the town because of the inflexible attitude of town officials.

The Maliseets began purchasing land in 1988 in accordance with the 1980 Indian Land Claims Settlement. That property is held in federal trust for the tribe and as such cannot be taxed. Instead, provisions are made in federal law for the tribe to make payments in lieu of taxes for the land.

In 1987, the two sides reportedly came to an agreement permitting the tribe to buy land, as long as the annual payments in lieu of taxes, or PILOTs, were calculated the same way as all other properties in the town, which included “any and all improvements to the land, including improvements now existing or hereafter arising.”

The tribe formed a housing authority in 1988. In 1993, the housing authority leased land from the tribe and the next year built 50 low-income housing units. The tribe claims that because the housing authority is a separate self-governing agency, the houses it owns are exempt from taxation.

Federal law restricts payments in lieu of taxes on those units to either $150 per unit or 10 percent of rent paid on each unit, whichever is greater. The town disagreed, claiming that the tribal housing authority was formed illegally and that the tribe and its housing authority must make payments in lieu of taxes for the full assessed value of the units.

Since 1993, those payments plus interest are now close to $500,000.

The tribe brought suit against the town, and in 1996, the late U.S. District Judge Morton Brody determined that the housing authority was legal.

Last August, U.S. District Judge Gene Carter ruled that the tribe and its housing authority also were correct in claiming that payments in lieu of taxes to the town are to be based solely on the value of the land on which the housing authority built houses for tribal members, and not on the improvements to the land, in this case, the houses themselves.

A second claim by the tribe that the town discriminated against it by denying housing to its members has yet to be decided by the federal court.

The issue involves more than just taxes. The U.S. Department of Housing and Urban Development has approved $3 million for the tribe to build 35 more low-income housing units on its trust lands. HUD will not release those funds, however, until the town and the tribe sign a cooperation agreement for services such as fire and police protection.

The town has declined to enter such an agreement until the taxes it claims are owed it are paid.

“The Houlton Band [of Maliseets] has been forced by the town to go to great lengths and expense to defend its interests and to see that the Houlton leaders simply follow the law as offered by Judge Brody’s decision,” Brenda Commander, the tribe’s chief, said during Monday’s meeting.

Marilyn Roper, who is not a tribal member, said that as a taxpayer in the town, she was, “embarrassed as to what’s going on here. Please don’t say you’re saving me tax dollars by what you’re doing.”

Describing the town officials as “Grinches,” in reference to a children’s book by Dr. Seuss, she added, “It’s long past time for the town of Houlton to sign a cooperative agreement with the [Maliseet] Housing Authority. You are holding up 35 housing units that could be built.”

Town Manager Allan Bean explained that of the $65,000, about half has already been spent for legal fees by the town in defending itself against the tribe’s lawsuits. The remaining amount will be needed as the town deals with the discrimination issue that has yet to be decided.

In the meantime, at the suggestion of several councilors, Carpenter and Council Chairman Paul Romanelli have agreed to meet with tribal representatives and each sides’ respective attorneys to discuss what steps could be taken to resolve the dispute.

“It’s incumbent upon us to do everything we can to get ourselves out of this litigation, even if it means a settlement,” Carpenter said.