From April to October 2001, High Country Adventures, Inc. paid $30,598.84 in privilege tax under protest and sought a refund. The lower court correctly rejected High Country's argument that exclusion of whitewater rafting from the state sales tax prohibited local governments from taxing the activity, since that permission came from an explicit grant of power from the state. However, the tax fell afoul of the federal law prohibiting taxes and tolls on watercraft or their passengers using the navigable waters of the United States, 33 U.S.C. § 5(b).
Consequently, the tax was held to be pre-empted by federal law and Polk County has been instructed to refund the tax revenue collected. The tax had raised some $700,000 per year, and the county is considering appealing to the state supreme court.