WASHINGTON, DC, November 7, 2008 (ENS) - A portion of the $700 billion bailout for the U.S. financial system rushed into law in October will go to local governments to compensate for taxes that cannot be levied on federal lands in their jurisdictions.
The local governments provide services such as transportation, firefighting and emergency response that support federal lands, but have not received full compensation from the federal government for these services.
More than $1.5 billion will be distributed through 2012 to local governments that qualify for the Payments in Lieu of Taxes, PILT, program, says Secretary of the Interior Dirk Kempthorne.
"I am extremely pleased that these communities, which provide important assistance in supporting federal lands, will be receiving their full compensation," Kempthorne said. "We appreciate their help and recognize that these local governments provide essential services to communities across the country.
Eligibility for PILT payments is reserved for local governments, usually counties, that contain national forests, national parks, Bureau of Land Management public lands, and lands dedicated to water resource development projects.
Kempthorne is scheduled to announce and distribute each state’s supplemental 2008 PILT funding by the third week in November.
Many rural counties encompass federal lands. Fifty-seven of Colorado's 64 counties are entitled to PILT payments from the federal government for public lands within their local jurisdictions that cannot be taxed. For them the new PILT authorization is a godsend in uncertain financial times.
U.S. Senator from Colorado Ken Salazar, a Democrat, says, "This new law is a breakthrough for Colorado counties that, year after year, have been shortchanged by the federal government on funds that support basic services in rural areas."
Larry Naake, executive director of the National Association of Counties, called the PILT provision in the bailout a "huge success" for the counties.
"Year after year, NACo has worked to increase the annual appropriations. While our work was rewarded with significant increases along the way, full funding always seemed just out of our reach," said Naake. "Achieving full funding for the PILT program this year is a tremendous victory for NACo and the dedicated grassroots efforts of our members."
Under the new authorization for the PILT program, $138.7 million in supplemental payments for fiscal year 2008 will be distributed to about 1,850 county and other local governments.
In June, $228.5 million in PILT payments was distributed to these jurisdictions. The combined payments will provide these governments their first full PILT entitlement payments since 1994.
The additional 2008 payments are authorized by the Emergency Economic Stabilization Act of 2008, which President George W. Bush signed on October 3, 2008.
The law also authorized full PILT payments through fiscal year 2012. Under this new authorization, payments are expected to increase annually as the entitlement levels are adjusted for inflation.
In total, the 2008 payments to local jurisdictions, by state, will be as much as $36 million. Ten western states will receive more than $20 million each; and another 23 states will receive from $10 million to $1 million each.
Kempthorne says that since 1994, payments have not matched the full entitlement level because funding levels were subject to Congressional appropriation.
From 1995 through 2008, payments to local jurisdictions funded from 41 to 77 percent of the entitlement levels.
The Emergency Economic Stabilization Act of 2008 makes the PILT program mandatory, so through 2012, payments will equal the full entitlement levels for each county and other local jurisdiction that receives PILT payments.
The Department of the Interior collects about $4 billion a year in revenue from commercial activities on federal lands, such as livestock grazing, timber harvesting, and oil and natural gas leasing.
Some of these revenues are shared with states and counties in the form of revenue sharing payments. The balance is deposited in the U.S. Treasury, which in turn pays for a broad array of federal activities, including PILT funding to counties.
Copyright Environment News Service (ENS) 2008. All rights reserved.