The U.S. Congress finally passed a federal budget and on Wednesday it gained funding, but they left out a key component relied on by Western states.
Payment in Lieu of Taxes (PILT), which compensates counties for missing out on property tax revenues due to large tracts of tax-exempt federal lands, was zeroed out in the omnibus appropriations legislation.
The neglected budget item is a blow to local counties who depend on the federal obligation to help pay for local services, from law enforcement and social services to education and infrastructure.
Montezuma County, containing 70 percent public lands, is missing out on $163, 243 in PILT funding authorized for 2014, reports county administrator Melissa Brunner.
“We will see across-the-board budget cuts to all departments without it,” she said.
Dolores County will have an approximate $140,000 budget shortfall because of the lack of funding; La Plata county $600,000; and Archuleta County $1 million.
U.S. Rep. Scott Tipton (R-Cortez), along with 60 Western legislators, voted against the appropriation bill because of the PILT funding omission. In a phone interview minutes after the vote, he called the oversight “a blatant disregard” of a very important Western issue.
“It is a primary funding mechanism for 29 counties in the 3rd Congressional District I represent and we are dissatisfied that leadership does not understand the importance of PILT to the West,” Tipton said. “I don’t understand the mind-set on both sides of the aisle. It is not a partisan issue.”
Colorado received nearly $32 million in PILT payments for 2013, with just over $21 million going to counties in the 3rd District.
However, there may be a solution for funding PILT on the horizon, Tipton said.
In a meeting with House Speaker John Boehner (R-Ohio) and Majority Whip Kevin McCarthy (R-CA) Tipton and other Western legislators were assured funding for PILT would likely go through as an attachment to the farm bill.
“We’re taking their word on it and sent a letter reminding them of their obligation,” Tipton said.
But it is not a sure thing. The farm bill has been languishing and has not been passed for two years, but it is in conference committee, and observers are cautiously optimist the legislation will be voted on soon.
Colorado’s U.S. senators, Michael Bennet and Mark Udall (D-CO.), along with other western representatives, have sent a letter to the conference committee urging PILT funding.
“Without an extension of PILT, rural counties will face drastic budget cuts in June and may struggle to fund the most basic of services,” the letter states. “In fact, some of these counties may be faced with potential insolvency.”
Udall introduced a bill earlier this week to permanently fund the program, and it was cosponsored in the House Thursday by Dean Heller (R-Nev.). Advocates are urging swift action on the Udall-Heller bill.
“PILT is not a discretionary fund to be used for other purposes,” Heller stated. “It is an obligation the federal government has to any county with public lands.”
Tipton expressed frustration that PILT had been ignored while at the same time the U.S. Forest Service received $178 million for new land acquisition.
The Natural Resource Committee has been “lamenting they don’t have the funding to properly administer forest service lands, so why do they want more?” Tipton said. “We found funding for PILT right there,” he said, nearly half of the $410,000 million PILT was authorized to receive.
It’s the first time PILT was not funded since the program’s inception in 1976.
“It’s not a giveaway, and is rather minor compensation for the amount of administrative services counties provide on federal public lands,” Tipton said.
“When an accident happens on public lands, the first responders are county sheriff and emergency staff. During the Weber Fire, when federal fire fighters arrived, the Mancos Fire Department was already on the scene fighting the fire.”
About 1,850 counties in 49 states depend on some form of PILT disbursement. Last year Colorado counties received $31.9 million in PILT funding.
The irony of funding federal land agencies buy private land, removing them from the tax rolls, while defunding the mechanism to compensate local governments for the loss of property tax revenues is not lost on PILT lobbyists.
“It’s not a question of whether we need the program, it is how do we pay for it,” said Ryan Yates, legislative director of the National Association of Counties. “”PILT impacts counties and communities we represent and without swift passage, county operations are disrupted.”
