This case stands for the proposition that State subsistence laws must comply with the terms of ANILCA and taht the State is due no deference when it comes to interpreting Title VIII of ANILCA. The case also prompted the Dept of Fish and Game to adopt permanent regulations that allow the Commissioner of Fish and Game to issue educational/cultural fishing permits. These permits have been important to the Cook Inlet tribes in terms of maintaining some semblance of their former subsistence culture. The case also set the standard by which the federal regulations defining "rural" were adopted, the result of which was to find at least some of the areas on the Kenai Peninsula (and Saxman in SE Alaska) to be rural, despite the fact that they had been excluded under the State's nonsubsistence area regulations.

The court ruled that the State's definition of rural, based upon the economic character of a community rather than its population size, went beyond the "common sense" definition of rural envisioned in ANILCA. The state's definition was found to exclude some persons from a subsistence priority who either lived in areas previously considered rural, or who themselves had moved to non-rural areas.

The court ruled that the state was too narrow in defining the rural areas where residents are given preference hunting and fishing rights for the purposes of family nutrition and trade. Judge Kozinski said "The term 'rural' is not difficult to understand, it is a standard word in the English language commonly understood to refer to areas of the country that are sparsely populated, where the economy centers on agriculture or ranching." The court did not substitute its own definition of rural. From this point, the state could lose management over federal lands if it doesn't change its law.

Taylor Brelsford: "In the Kenaitze case, the Federal 9th Circuit Court of Appeals agreed with the Kenaitze Indians that the Kenai Peninsula had wrongly been designated as non-rural by the Alaska Boards of Fisheries and Game, and thereby excluded from any subsistence allocations. The Court held that the Alaska Legislature had defined 'rural' improperly, and that under ANILCA's definition regions with small and dispersed populations should be designated as 'rural.'"

Alaska Federation of Natives Conference guide and agenda: "The Kenaitze decision was issued by the Federal appeals court which said the State's definition of "rural" (the economic nature of the community) was not consistent with that of ANILCA (the pop. of the community)."

Alaska State Legislature, House District 27: Judge Fabe found that the nonsubsistence areas authorized by the 1992 state law were unconsitutional because they "effectively re-establish the rural/urban residency requirement struck down in McDowell."