Many counties are compensated for the tax-exempt status of federal lands.
Counties with national forest lands and with certain Bureau of Land
Management (BLM) lands have historically received a percentage of agency
revenues, primarily from timber sales. However, timber sales have declined
substantially—by more than 90% in some areas. Thus, Congress enacted
the Secure Rural Schools and Community Self-Determination Act of 2000
(SRS; P.L. 106-393) as a temporary, optional program of payments based on
historic, rather than current, revenues.
Authorization for SRS payments originally expired at the end of FY2006, but
through several reauthorizations the program was extended through FY2012.
Congressional debates over reauthorization considered the basis and level
of compensation (historical, tax equivalency, etc.); the source of funds
(receipts, a new tax or revenue source, etc.); the authorized and required uses of
the payments; interaction with other compensation programs (notably Payments in
Lieu of Taxes); and the duration of any changes (temporary or permanent).
In addition, legislation with mandatory spending, such as SRS
reauthorization, raises policy questions about increasing the deficit;
current budget rules to restrain deficit spending typically impose a procedural
barrier to such legislation, generally requiring offsets by additional
receipts or reductions in other mandatory spending.
In 2008, the Emergency Economic Stabilization Act (P.L. 110-343) enacted a
four-year extension to SRS authorization through FY2011, with declining
payments, a modified formula, and transition payments for certain areas.
In 2012, Congress enacted a one-year extension through FY2012, and amended
the program by slowing the decline in payment levels and
tightening requirements that counties select a payment option promptly
Section 302 of the Budget Control Act (P.L. 112-25, as amended by P.L. 112-240)
requires the President to order a sequester, or cancellation, of budgetary
resources for FY2013. The sequester order took effect on March 1, 2013,
and affected the SRS payment for FY2012, although BLM and Forest Service
implemented the order differently from each other.
With the expiration of SRS at the end of FY2012, county compensation is again
the subject of congressional debates. County payments are set to return to
a revenue-based system for FY2013, and are likely to be significantly
lower than the previous years’ payments. However, payments for FY2013 have
not yet been made, and Congress may consider extending SRS (with or
without modifications and with or without addressing the sequester order),
implementing other legislative proposals to address the county payments,
or taking no action. No action would continue the revenue-based system
that took effect upon the program’s expiration. Discussion in the 113th Congress has focused on
many of the same issues that were debated in 2006-2008 and again in 2012.
On September 19, 2013, the Senate passed H.R. 527, the Responsible
Helium Administration and Stewardship Act of 2013. The Senate version
would reauthorize SRS for FY2013. On September 20, 2013, the House passed
H.R. 1526, the Restoring Healthy Forests for Healthy Communities Act,
which would provide a one-time SRS payment in 2015.
Date of Report: September 23, 2013
Number of Pages: 23 Order Number: R41303
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