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Thursday, November 21, 2013

Reauthorizing the Secure Rural Schools and Community Self-Determination Act of 2000

Katie Hoover
Analyst in Natural Resources Policy

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 FY2013. 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 (P.L. 112-141). In 2013, Congress again enacted a one-year extension through FY2013 (P.L. 113-40).

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.

The 113
th Congress has already debated many of the same issues that were debated between 2006 and 2008 and again in 2012. On October 2, 2013, the President signed P.L. 113-40 into law, reauthorizing SRS payments for FY2013. However, with the expiration of SRS at the end of FY2013, county compensation is again the subject of congressional debates. County payments are set to return to a revenue-based system for FY2014, and are likely to be significantly lower than the previous years’ payments. Congress may consider extending SRS (with or without modifications), 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. 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 for FY2014.

Date of Report: November 14, 2013
Number of Pages: 25
Order Number: R41303
Price: $29.95

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