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HELENA — The Crow Nation and the state have settled nearly four decades of litigation over whether Montana can tax coal owned by the tribe, with the state to pay $15 million if the tribe gives up claims on past taxes collected.

The dispute, which began in the 1970s, is over land near the Crow reservation in southeastern Montana that the tribe ceded to the U.S. more than a century ago. The tribe still owns the mineral rights to the coal-rich land, where the Westmoreland Coal Company leases the reserves and produces an average 5.5 million tons of coal through its Absaloka mine.

The state...