03.27.07

Senators Introduce Multi-Year County Payments Renewal

WASHINGTON, DC - Struggling rural schools and communities were thrown a lifeline today by a bipartisan coalition of U.S. Senators, when they offered a multi-year proposal to restore funding for the Secure Rural Schools and Community Self Determination Act, commonly known as the county payments law. U.S. Senator Ron Wyden offered the amendment to the 2007 Emergency Supplemental Appropriations bill with the support of U.S. Senate Majority Leader Harry Reid (D-NV) and U.S. Senators Max Baucus (D-MT), Jeff Bingaman (D-NM), Gordon Smith (R-OR), Maria Cantwell (D- WA), Pete Domenici (R-NM), Barbara Boxer (D-CA), Larry Craig (R-ID), Patty Murray (D-WA), Mike Crapo (R-ID), Jon Tester (D-MT), Ted Stevens (R-AK), Robert Bennett (R-UT) and Lisa Murkowski (R-AK).

The Senators' proposal would immediately resolve the budget crisis confronting rural communities by fully funding the county payments program for 2007. This five-year plan will provide counties with a predictable stream of funding which will gradually ramp down by ten percent per year through 2011, providing Oregon, Washington and California counties time to adjust to the new nationwide funding formula. The new formula is based on the current funding formula and the current acreage of U.S. Forest Service (USFS) and eligible Bureau of Land Management (BLM) lands, along with a mechanism to focus support on those communities in greatest economic need.

Additionally the plan includes five years of full funding for Payment in Lieu of Taxes (PILT) which compensates states for loss of tax revenue from Federal lands in the state. Full funding of PILT would also provide increased funding for counties in Oregon and around the country that lose tax revenues due to the presence of Federal lands in the state. About $425 million of the $5 billion package would be paid for with emergency spending in 2007. The following four years will be funded by closing a series of tax loopholes.

"This legislation will help strengthen America's rural communities by providing funding for vital programs," said Reid. "This is especially important in western states like Nevada, where so much of the land is owned by the federal government. My Democratic colleagues and I are committed to improving life in rural America and this legislation plays a very important role in accomplishing that."

"Without the extension of county payments that this legislation provides, Oregon counties' funding would plummet from $280 billion last year all the way down to zero. That loss means laying-off law enforcement and teachers, releasing criminals from prison, and closing libraries and public health clinics." Wyden said. "Losing county payments funding is an emergency for these communities, which makes today's emergency supplemental bill the right place and the right time for Congress to finally fulfill its commitment to rural America."

"Extending the county payments program means we are standing by the millions of Americans who depend on this funding for emergency services, education, and indispensable infrastructure," said Cantwell. "We are committed to keeping our rural communities strong and helping forest counties as they work to get their local economies back on track."

Over 700 counties in 39 states received funding under the Secure Rural Schools and Community Self Determination Act of 2000, which was allowed to expire in September 2006. Efforts in the last Congress to reauthorize the law failed because the Congress and the Administration could not agree on the funding source for the legislation.

Before the county payments law passed in September 2000, many rural counties were receiving payments as the result of 1908 and 1937 laws specifying that the government share 25 percent of USFS receipts and 50 percent of BLM O&C land receipts with counties in states that host Federal land from which timber is cut. These payments had been used to help finance rural schools and roads. Toward the mid- to late-nineties, however, the principal source of those revenues, federal timber sales, declined by over 70 percent nationwide. Consequently, the corresponding revenues shared with rural counties throughout the country declined precipitously, hurting school and transportation funding.

In 2000, Wyden authored the Secure Rural Schools and Community Self Determination Act to provide an alternative source of county funding by establishing a six-year payment formula for counties that receive revenue-sharing payments for USFS and BLM O&C lands. The formula established a stable source of revenue, a safety-net—or "full payment amount"—to be used for education, roads and county services in rural areas. The legislation also provided funding for ecosystem restoration, infrastructure maintenance and stewardship projects on national forests, fostering all-too-rare cooperation between counties, timber interests, and environmentalists. The safety net amount was based on historical timber receipts.

 

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