Clock ticking on PILT, timber funding

By Larry Meyer
Argus Observer
Sunday, June 8, 2008 2:31 AM PDT

ONTARIO  - A resolution to the fight in Congress to retain the Secure Rural Schools Program and increase the Payment In Lieu of Taxes to full-funding still has not been reached, and one Malheur County official says the PILT issue will not be resolved until after the election and a new president has been selected. In the meantime, the clock continues to tick for counties who rely on the Secure Rural Schools funds for a major part of their budgets.

At stake is at what level county governments and road departments will continue to operate past the end of the fiscal year, June 30, if those funds are not renewed. Some counties have already made drastic cuts in their services, such as closing libraries and reducing staff.

 However, while Malheur County receives some Secure Rural Schools funding, its primary source of revenue from federal programs is the Payment In Lieu Taxes funds, which provide money to counties with federal lands, which are not subject to property taxes. More than 70 percent of Malheur County is federal land.

The Secure Rural Schools Program was approved to provide funds to replace revenue counties and schools received from timber sales receipts.

For the current budget year, ending this month, the county received about $1.3 million and has been told its allocation for the next fiscal year should be the same.

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“We know we get the same money as last year,” Malheur County Judge Dan Joyce said. “We know that.”

What Oregon lawmakers and those from other states have been working on is full-funding for PILT, which Joyce has said would increase the payment to Malheur County to more than $2 million.

House Bill 3058, which was defeated Thursday night, would have funded the Secure Rural Schools Program for another four years, according to Congressman Greg Walden, and as originally written would have raised PILT to full-funding in four years.

However, that portion of the bill was stripped out, Walden said, which is the main reason he voted against it, even though he also supports the Secure Rural Schools Program.

“It was the hardest vote I have had to cast,”  he said Friday in a phone interview.

Walden also opposed the mechanism the bill used to fund the payments, which he said was illegal, and he and other lawmakers had been promised it would be taken out.

“From what I’ve heard so far, they have made it convoluted,” Joyce said of the process.

Andrew Whelan, Greg Walden’s spokesperson, confirmed Joyce’s theory that the House bill’s funding mechanism would not cover PILT and so it was taken out.

Noting that President Bush does not support either Secure Rural Schools  or PILT funding and has threatened to veto both, Joyce said, “It (the outcome) will depend on what happens this fall.”

Regardless of what happens to the four-year extension of Secure Rural Schools funding, Walden said his top priority will be to get a one-year extension, which is part of the war-funding bill.

That would be the second one-year extension to be issued. That is needed because, even if the four-year extension is approved, there would be a one- or two-year delay before the money would start coming to the counties, Walden said.

Another concern for Malheur County officials is if the Secure Rural Schools funding is not extended, other counties will also seek the PILT funds, which is not as large a pot of money, and Malheur County would stand to lose.