[Senate Hearing 116-348]
[From the U.S. Government Publishing Office]
S. Hrg. 116-348
AN EXAMINATION OF FEDERAL PAYMENTS TO LOCAL GOVERNMENTS PROVIDED
THROUGH THE SECURE RURAL SCHOOLS AND PAYMENTS IN LIEU OF TAXES
PROGRAMS, AND TESTIMONY ON PENDING LEGISLATION
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
on
S. 430
S. 1643
S. 2108
__________
NOVEMBER 21, 2019
__________
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the
Committee on Energy and Natural Resources
Available via the World Wide Web: http://www.govinfo.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
39-873 WASHINGTON : 2021
COMMITTEE ON ENERGY AND NATURAL RESOURCES
LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming JOE MANCHIN III, West Virginia
JAMES E. RISCH, Idaho RON WYDEN, Oregon
MIKE LEE, Utah MARIA CANTWELL, Washington
STEVE DAINES, Montana BERNARD SANDERS, Vermont
BILL CASSIDY, Louisiana DEBBIE STABENOW, Michigan
CORY GARDNER, Colorado MARTIN HEINRICH, New Mexico
CINDY HYDE-SMITH, Mississippi MAZIE K. HIRONO, Hawaii
MARTHA McSALLY, Arizona ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee CATHERINE CORTEZ MASTO, Nevada
JOHN HOEVEN, North Dakota
Brian Hughes, Staff Director
Kellie Donnelly, Chief Counsel
Michelle Lane, Professional Staff Member
Sarah Venuto, Democratic Staff Director
Sam E. Fowler, Democratic Chief Counsel
Bryan Petit, Democratic Senior Professional Staff Member
C O N T E N T S
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OPENING STATEMENTS
Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska.... 1
Manchin III, Hon. Joe, Ranking Member and a U.S. Senator from
West Virginia.................................................. 3
Daines, Hon. Steve, a U.S. Senator from Montana.................. 5
Wyden, Hon. Ron, a U.S. Senator from Oregon...................... 6
Risch, Hon. James E., a U.S. Senator from Idaho.................. 7
WITNESSES
Dilley, Justin M., Teacher of Science, Pocahontas County High
School, and Former Member, Pocahontas County Board of Education 19
Prysunka, Hon. Stephen, Mayor, Wrangell City and Borough, Alaska,
on behalf of the National Association of Counties.............. 29
Rowley, Allen, Associate Deputy Chief, National Forest System,
USDA Forest Service............................................ 38
Flanagan, Denise, Director of Budget, U.S. Department of the
Interior....................................................... 45
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
AASA, The School Superintendents Association:
Letter for the Record........................................ 146
Alaska Municipal League:
Resolution #13-2020.......................................... 148
Resolution #14-2020.......................................... 149
American Bird Conservancy, et al.:
Letter for the Record........................................ 150
Crapo, Hon. Mike:
Statement for the Record..................................... 154
Daines, Hon. Steve:
Opening Statement............................................ 5
Dilley, Justin M.:
Opening Statement............................................ 19
Written Testimony............................................ 22
Flanagan, Denise:
Opening Statement............................................ 45
Written Testimony............................................ 47
Responses to Questions for the Record........................ 136
Greenbrier County (West Virginia) Schools:
Letter for the Record........................................ 9
Judith Basin County (Montana) Commissioners:
Letter for the Record........................................ 57
Manchin III, Hon. Joe:
Opening Statement............................................ 3
Montana Association of Counties:
Letter for the Record........................................ 58
Mora County (New Mexico) Commissioners:
Letter for the Record........................................ 59
Murkowski, Hon. Lisa:
Opening Statement............................................ 1
National Association of Counties:
Letter for the Record........................................ 60
National Education Association:
Letter for the Record........................................ 155
National Forest Counties and Schools Coalition:
Letter for the Record........................................ 156
Nevada Association of Counties:
Letter for the Record........................................ 61
New Mexico Counties:
Letter for the Record........................................ 62
Pendleton County (West Virginia) Schools:
Letter for the Record........................................ 10
Pocahontas Rd County (West Virginia) Board of Education:
Letter for the Record........................................ 11
Prysunka, Hon. Stephen:
Opening Statement............................................ 29
Written Testimony............................................ 31
Randolph County (West Virginia) Schools:
Letter for the Record........................................ 13
Risch, Hon. James E.:
Opening Statement............................................ 7
Rowley, Allen:
Opening Statement............................................ 38
Written Testimony............................................ 40
Responses to Questions for the Record........................ 78
Tucker County (West Virginia) Schools:
Letter for the Record........................................ 16
Webster County (West Virginia) Board of Education:
Letter for the Record........................................ 18
Western Governors Association:
Letter for the Record........................................ 161
Wyden, Hon. Ron:
Opening Statement............................................ 6
----------
The text for each of the bills which were addressed in this hearing can
be found on the committee's website at: https://www.energy.senate.gov/
hearings/2019/11/full-committee-hearing-to-receive-testimony-on-
pending-legislation
AN EXAMINATION OF FEDERAL PAYMENTS TO LOCAL GOVERNMENTS PROVIDED
THROUGH THE SECURE RURAL SCHOOLS AND PAYMENTS IN LIEU OF TAXES
PROGRAMS, AND TESTIMONY ON PENDING LEGISLATION
----------
THURSDAY, NOVEMBER 21, 2019
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The Committee met, pursuant to notice, at 10:10 a.m. in
Room SD-366, Dirksen Senate Office Building, Hon. Lisa
Murkowski, Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. LISA MURKOWSKI,
U.S. SENATOR FROM ALASKA
The Chairman. Good morning, everyone. The Committee will
come to order. Senator Manchin is on his way, but we will get
moving with opening statements.
We are here this morning to examine two important programs:
Secure Rural Schools and Payment in Lieu of Taxes. We know them
more directly as SRS and PILT. This hearing is probably a
little bit different than some that we have had recently
because in addition to conducting oversight this morning we are
also examining how well these programs are working, what we can
do to improve them and also to hear testimony on three bills
that are related to them.
I want to welcome all of our witnesses that have joined us
this morning with a special shout out to Mayor Stephen
Prysunka. Mayor Prysunka is from Wrangell, Alaska, a community
that I have talked about here in this Committee. It is where I
spent some very formative growing up years. My parents still
live there. I go there every summer. I think I have stated for
the record, I am sure, that it hosts probably the best Fourth
of July in all of America. So any of you who may want to
challenge me on that, you have to come to Wrangell first. I
know the community would welcome you. I understand that this is
your first trip to Washington, DC, so we welcome you and we
thank you for your leadership in Wrangell.
My colleagues here on the Committee have heard me say this
a lot--we are a big state. We have a lot of resources. We call
the Federal Government our landlord because it owns more than
60 percent of our land, roughly 222 million acres, and much of
that is controlled by the Department of the Interior and the
Forest Service. We are a big, big area, but we don't have a lot
of private land.
People think that you have all this land around you and you
must have private ownership, but the example here this
morning--the Borough of Wrangell spans an area of more than
3,400 square miles and that is just the Borough of Wrangell.
Over 97 percent of it is owned by the Federal Government. When
you think about what that means to your community, that leaves
a pretty small tax base to address everything from public
services to necessary infrastructure.
I don't want to preempt or spoil any testimony here this
morning, but Mayor Prysunka estimates that Wrangell, which has
a population of about 2,500--I think it is a little bit less
than that, but during the summer we are about 2,500--but it has
one of the highest sales tax and mill rates in the state. It
has an infrastructure backlog approaching $250 million. I mean,
it is very clear that the numbers simply do not add up here and
that is why programs like PILT and SRS are so important to our
rural communities.
Many of the Alaskan communities rely on SRS to pay for,
really, essential services, whether it is schools or roads, but
what they have faced is a decline in timber receipts over the
years and a lack of access to federally-owned forested lands.
And so you are in a situation where these programs are really
the only option until the Federal Government steps up as a true
partner to support jobs and economic opportunity on our federal
lands.
But today, there are areas where I think we see this is not
the case. We are not seeing that partnership. The Tongass, in
Southeast where Wrangell is, is our largest national forest. We
are barely harvesting any timber there, just nine million board
feet last year. It is tough to establish a sustainable
industry. The few remaining mom and pop mills are, we are
always saying they are hanging on by a thread or hanging on by
their fingernails, but they are just constantly reckoning with
the fact that they don't have a reliable small supply.
And that means that the people that live there and work
there are really in this very tenuous situation. So it's bad
enough to create a situation where communities are forced to
rely on the Secure Rural Schools program, but it is worse still
that despite its importance Congress has let its authorization
lapse. And that means funding for important school functions,
really some very, very basic things like teacher salaries,
counselor salaries, arts and music, the extracurriculars, these
are all now at risk. Of course, this is not limited to my
state.
Around the country states with big swaths of federal lands
face significant challenges in developing sustainable
economies. And with the Federal Government failing to
responsibly manage our forests, we have seen timber harvest
decline. Activities like mining are prohibited or generally
discouraged despite the multiple use mandate, and that creates
a real problem. When we are not allowed to responsibly develop
our resources, our rural communities suffer. We lose jobs. We
lose revenues. Many communities are left with inadequate
funding for their schools, forcing them to depend more and more
on programs, government programs, like SRS and PILT to make up
the difference.
And I think that we can do better. We are doing some of
that through the appropriations process. We fully funded PILT.
We fought for the continuation of SRS, but new legislation, I
think, is something that we have long talked about here in this
Committee. Senator Wyden and Senator Daines and I were
discussing earlier, the years throughout this Committee where
there have been multiple short-term reauthorizations, efforts
to address this legislatively. So today's agenda will
introduce, again, some of these.
Senator Crapo has introduced S. 430, which I have co-
sponsored, to provide a two-year reauthorization for Secure
Rural Schools. That would provide a small dose of certainty to
affected communities as we seek broader reforms that make the
program less necessary. I would just say, even as I have
sponsored that or co-sponsored this, it is just yet one more
band-aid that will get us through two years. But if you are a
community like Wrangell, two years is not a lot of planning
time.
Senator Daines has introduced S. 2108, a bill to create
parity for rural counties by increasing the PILT population
payment rate for counties with populations under 5,000. I am
also a co-sponsor of this one. He is going to be speaking to
that in just a moment here.
Then the final bill on the agenda is from Senator Wyden, S.
1643, to establish an endowment eventually funded by timber
receipts with some help from Congress at first to make SRS
payments. This is a new approach. I look forward to learning
more about it.
But as we look at these programs and the measures related
to them, I think we have good experts here this morning who can
speak to the state and local aspects of these programs. I
certainly look forward to your comments this morning in terms
of whether you support and how you would support these
initiatives and how we can work with you to provide for your
communities the funds that they seek as they try to be
sustainable communities.
With that, I turn to my colleague, Senator Manchin.
STATEMENT OF HON. JOE MANCHIN III,
U.S. SENATOR FROM WEST VIRGINIA
Senator Manchin. Chairman Murkowski, thank you for
convening the hearing today on two very important county
payment programs. For years now, you and I have worked in
keeping the Payment in Lieu of Taxes program, which we refer to
as PILT, and the Secure Rural Schools program funded both
through our work on this Committee and also on the
Appropriations Committee. I particularly would like to thank
you for your leadership in getting full funding for the PILT
program included in this year's Interior Appropriations bill
that we passed out of the Senate last month.
Today we are going to be discussing three bills from
Senators Crapo, Wyden and Daines that address both PILT and
Secure Rural Schools in various ways. We have a great panel
here today. I want to thank you all for coming and making the
effort to be here. I would like to also welcome our witnesses
and thank them for traveling as far as they have to be here
today.
I would like to recognize Justin Dilley. Justin's from
Pocahontas County. He is a high school science teacher in my
home State of West Virginia. Thank you, Justin, for being here.
I understand Justin's students back in West Virginia,
Pocahontas County, are watching us live this morning, and I
would like to say hello to all of them and remind them that
they have a great teacher in you, Justin. I know they already
know that. I happen to be married to a teacher myself. I
understand the work and sacrifices that all of you put in to
this job, a labor of love. On behalf of me and my wife, Gail, I
want to thank both you and your wife for the commitment and
service you provide to helping our next generation of West
Virginians prepare to succeed in life.
The Secure Rural Schools and PILT programs were established
to provide funding to counties that host federal lands.
Nationwide counties use funding from these programs to run
basic services like law enforcement, road maintenance and
childhood education. Across the nation, 742 counties have been
able to fund their school programs because of the Secure Rural
Schools program. And last year, more than 1,900 counties
received $515 million in funding thanks to the PILT program.
These programs are the lifeblood of rural counties that contain
large portions of federal land.
In Pocahontas County, West Virginia, where Justin is from,
we have the Monongahela National Forest. While we welcome more
than one million visitors to Monongahela National Forest each
year, Pocahontas County is challenged by the fact that about
half of its land base is federally owned. It is tax exempt.
They get nothing from that as they would the private sector. In
other words, it is not able to generate local tax revenue.
Pocahontas and 13 other West Virginia counties rely on Secure
Rural Schools and PILT to provide essential services. Since the
Secure Rural Schools program expired, I have received numerous
letters from the school superintendents and business managers
that rely on Secure Rural Schools funding to support critical
services. Many of them are with us today in the audience.
For example, Sherry Radcliffe. Sherry, and she is sitting
right there behind Justin, she serves as the Finance Director
of the Pocahontas County Board of Education. We hear from
Sherry quite frequently when she is grappling with difficult
decisions around staffing and budget cuts due to the
uncertainty of the Secure Rural Schools program. As I am going
to mention, you will see why she is so concerned because
without Secure Rural Schools funding Pocahontas County would
just receive $72,000 next year, $72,000 compared to $750,000
that it received last year. There is no way, no way they can
continue serving the students in Pocahontas County.
So Senators Crapo and Wyden have been working with Chairman
Murkowski and myself along with several other members of the
Committee to reauthorize the Secure Rural Schools program.
Senate bill 430, which is on the agenda today, would provide a
two-year extension to the program. Senator Wyden and I have
also been working with Chairman Murkowski on a long-term
solution to provide permanent funding for county payment
programs. Senator Wyden started the conversation with the idea
of creating an endowment and using the interest generated in
that endowment to fund the money needed to pay Secure Rural
Schools payments in perpetuity. We are continuing to flesh that
out and that is one of the bills that we will be receiving
testimony on today also.
The Secure Rural Schools program provides funding to
counties that used to receive funding from timber harvesting.
When timber harvesting dwindled, receipts dropped off, and
Congress started this county payment program. A similar
storyline is playing out in other parts of my state and across
the country with other communities. For example, in coal
communities whose economies have experienced drastic declines.
I am examining where there are ways in which we can expand the
Secure Rural Schools program to cover the other rural
communities whose economies are similarly impacted by downturns
in natural resource production. I look forward to engaging with
the witnesses this morning on how we might be best able to do
that.
I believe we have a great opportunity to redesign these
programs in ways that will ensure that we are serving the needs
of rural communities in the best ways possible. The reason I
say that, our country is being split wide open between rural
and suburban. We have to do something. We are all in this
together, and we have to work together. That is really what
this hearing is about today.
I want to thank the Chairman for having this hearing and
calling you all here and thank you all for traveling to be with
us.
Madam Chairman.
The Chairman. Thank you, Senator Manchin.
I will turn to both Senator Daines and Senator Wyden for
very brief comments as they seek to introduce the bills they
have laid down, and then we will turn to our witnesses.
Senator Daines.
STATEMENT OF HON. STEVE DAINES,
U.S. SENATOR FROM MONTANA
Senator Daines. Great. Chairman Murkowski, thank you as
well as Ranking Member Manchin, and also your comments about
the rural-urban divide that we see today across our country.
Thanks for holding this hearing on Secure Rural Schools and
Payment in Lieu of Taxes, affectionately known as SRS and PILT.
Specifically, I want to thank you for including my bill, the
bipartisan, Small County PILT Parity Act.
This bill is very simple. It is bipartisan. It is going to
have a significant impact and a positive impact on these small
counties. What my bill does, it expands the existing PILT, or
the Payment in Lieu of Taxes, for counties that have less than
5,000 people. That is a foreign concept back here in
Washington, DC, but back home in Montana, we have eight
counties as such. You have Judith Basin County, Sweet Grass
County, Petroleum County, Garfield County, McCone County,
Prairie County and Carter County. I could tell you a story
about each one of those counties either as a kid growing up, or
when I shot my first antelope. These are really special places.
They have a lot of animals, but very few people.
This bill has no effect on large counties. It has broad
public support. It is very bipartisan and it is desperately
needed for our Montana counties. In fact, 22 of our counties in
Montana have less than 5,000 people. We have 56 counties and 22
have less than 5,000. Three of those counties have less than
1,000 people in the entire county.
Take Garfield County in Montana as an example. It is twice
the size of Delaware. Yes, I am talking about the entire State
of Delaware. It has a population of 1,200 people. Delaware has
a population of about a million people to put that in
perspective.
Thirty-seven percent of Petroleum County is federally
owned, and while public lands are a major driver of our outdoor
economy, they are not on the county tax roll. They leave these
counties with a large area to maintain with a relatively small
amount of money and a small tax base. That is why PILT is vital
for the county.
And these PILT payments are vital. They help fund local law
enforcement, firefighting, schools, roads, search and rescue
and so much more. Without PILT, these services can get cut. I
literally have stories of county commissioners, when the PILT
payments aren't coming through, where they are out there
running road graders to get the snow cleared so the school
buses can get the kids to school. True stories from Montana.
That creates safety issues for Montanans and the well-being of
our families are put at risk. That is why this bipartisan bill
is critical for Montana's small counties.
I want to thank my colleagues who are co-sponsors,
especially Chair Murkowski, Senator Gardner and Senator Cortez
Masto, who serve on this Committee. I look forward to working
with my colleagues on both sides of the aisle to get this bill
signed into law as quickly as possible.
Thank you, Chair Murkowski.
The Chairman. Thank you, Senator.
Senator Wyden.
STATEMENT OF HON. RON WYDEN,
U.S. SENATOR FROM OREGON
Senator Wyden. Thank you, Madam Chair and Senator Manchin,
you all have a lot on your plate. This is the end of the year
crunch. I know what we are dealing with in the Finance
Committee. And the fact that you, Madam Chair and Senator
Manchin, decided that this was so important that you wanted to
have a special hearing on this topic when there is a lot going
on is just a statement about the bipartisan support you all
have shown for these programs. And I think we have had a great
tradition on that.
And colleagues, I am not going to force a long trip down
memory lane with respect to these issues, but I just want to,
kind of, capsulize what this was all about because we wrote
Secure Rural Schools in this room. And without it, for example,
I think a lot of school districts in rural America would tell
you they would have school three days a week. I know, because
they have told me that over the years.
Secure Rural Schools and now the transition to this
exciting concept of an endowment--and Senator Risch is one of
the sponsors as well--speaks to where I think this debate
really needs to start and that is the stool has essentially had
three legs. One was the safety net and that was Secure Rural
Schools and the help for roads and law enforcement and basic
services. And we made the judgment. It was valid then, valid
now, that you are never going to get the harvest up high enough
to meet all the needs that our counties have. So we are going
to need a safety net. We said it then, and it is still true
now. Second, because this is a multiple-use committee, and we
have always been supportive of multiple-use, we want to get the
harvest up in a sustainable kind of fashion. Third, is
essentially the forest management leg. Those were the three
legs and over the years they picked up additional
considerations. There is fire and climate change, for example,
under forest management.
What I hope we can do today is start spelling out the
updating of that stool. And what Senator Risch and I and the
Northwesterners, and we have been so pleased it had your
attention, have been saying is, let's get these rural
communities off the roller coaster. I think we are going to
hear that today. I mean, Congress would always go until the
very end, and schools would be scratching their heads, and they
would call Senator Murkowski and Senator Risch asking when can
they plan our budget? What is going to happen? And we would
always, somehow, find a way to do it.
I remember when I was Chair, we sold off the Helium Reserve
in order to cover Secure Rural Schools which prompted headlines
saying, not Senator Murkowski, but Wyden has always been full
of hot air, and we have just seen it again. But we want to get
off that roller coaster. So what we have put together is a kind
of endowment process. And if, Madam Chair, this Committee in
its bipartisan tradition can figure out a way to use Secure
Rural Schools to help these folks deal with the immediate
concerns while we get this endowment together, I think then we
are on our way to, in effect, modernizing the forestry policy
of this country. I want to also thank the Administration as
they have been talking to us as well.
Thank you.
Senator Risch. Madam Chair?
The Chairman. Senator Risch.
STATEMENT OF HON. JAMES E. RISCH,
U.S. SENATOR FROM IDAHO
Senator Risch. Let me add a few comments. I could not have
said it better myself, especially the part about the Helium,
Senator Wyden.
Senator Wyden. Hot air, but not----
Senator Risch. In any event, this is a really serious
problem and the thing that has really frustrated me, as long as
I have been here, is we get a lot of lip service from our
colleagues who really don't have a lot of federal land and
don't have the kind of problems that we have. With all this
talk about well, we are all Americans and yes, you have all
this federal land but remember, we are all in this together. It
is all parts. But then when it comes to stepping up and being a
good neighbor and paying for the actual maintenance and the use
of it, they just don't step up. And this is not a partisan
issue by any stretch. This is a bipartisan issue. But we really
need to figure this thing out. It is just not right, as Senator
Wyden indicates, to go on year after year. It actually would
not be bad if the short--or the timing was the same every year,
but it never is. And anybody who has ever managed a business
knows, you cannot manage a business with uncertainty.
So this has been a frustrating problem and one that
everyone, everybody that has federal lands to any great extent,
suffers with. Thank you for holding the hearing.
Senator Manchin. Madam Chairman?
The Chairman. Thank you. We do want to get to the
witnesses.
Senator Manchin. I know.
[Laughter.]
The Chairman. Please.
Senator Manchin. Along with Pocahontas County, I have five
other counties that have sent letters I wanted to introduce for
the record.
The Chairman. Great.
Senator Manchin. It is Randolph, Webster, Tucker,
Greenbrier, Pendleton, along with Pocahontas.
[Letters from five counties in West Virginia follow.]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Senator Manchin. And if I may ask, I have to go give a
Floor speech. I would like to hear Justin's opening remarks.
Would it be possible to start with Justin from West Virginia?
How does that sound?
The Chairman. What do you think?
I was going to go with the Mayor of Wrangell, but----
[Laughter.]
We will give you that courtesy.
Senator Manchin. Thank you.
The Chairman. I do appreciate the, kind of, the roller
coaster and the discussion of the history of this issue coming
out of this Committee and, as frustrated as we are about this,
imagine what it means to be the Mayor of Wrangell, to be any of
these counties that you have outlined, to be the county
commissioners that Senator Daines has pointed to where you have
1,200 people there. This ought not be impossible to resolve, so
let's get to work on it.
I will introduce all of the witnesses here this morning,
and then we will go in reverse order, Mr. Dilley, so you can
start.
We are joined this morning by Denise Flanagan, who is the
Director at the Office of Budget for the Department of the
Interior. We appreciate your leadership over there.
Mr. Allen Rowley, who is the Associate Deputy Chief at the
Forest Service with USDA. Thank you for being here.
I have mentioned Mayor Prysunka, who is the Mayor of the
City and Borough of Wrangell and, again, the fact that he is
able to provide this perspective this morning is so greatly
appreciated.
And Justin Dilley, who has been introduced by Senator
Manchin, from the Pocahontas County High School.
Senator Risch. Madam Chairman?
The Chairman. Sir?
Senator Risch. I should note that we have a celebrity here,
Mr. Allen Rowley. You probably don't know, as I am told, the
second-best student ever to graduate from the University of
Idaho with the College of Forestry.
The Chairman. And who was that first best?
Senator Risch. I would have to look that up, Madam Chair.
[Laughter.]
The Chairman. Good, we appreciate that.
[Laughter.]
We would ask that you try to keep your comments to about
five minutes, and then we will have an opportunity to ask
further questions. Your full statements will be included as
part of the record. I will remind colleagues that we have three
votes starting at 11:30, so we have a lot of work to do. So
everybody talk fast, and we are not going to talk as much. We
usually don't, but we all get really energized about this
issue, I think you can see.
Mr. Dilley, why don't you start off?
STATEMENT OF JUSTIN M. DILLEY, TEACHER OF SCIENCE, POCAHONTAS
COUNTY HIGH SCHOOL, AND FORMER MEMBER, POCAHONTAS COUNTY BOARD
OF EDUCATION
Mr. Dilley. Thank you, Chairman Murkowski, Ranking Member
Manchin and other members of the Committee for inviting me here
today. I'm very pleased to be here to discuss the Secure Rural
Schools (SRS) and the PILT program funds as well. I know I can
only speak today to my experiences in my county, but I feel our
struggles are mirrored by most rural counties across the
country.
Again, my name's Justin Dilley. I'm a former self-employed
land surveyor. I also have a Bachelor's of Science in Civil
Engineering and now teach at Pocahontas County High School. My
family has also lived in Pocahontas County for over 150 years.
Pocahontas County has a population of about 8,400 people
and a land area of about 602,000 acres. It makes it the third
largest county in the 55 counties in West Virginia. That gives
us, also, a population density of 8.9 people per square mile,
the lowest in West Virginia. Out of the 602,000 acres that make
up Pocahontas County, almost two-thirds of this is the
Monongahela National Forest. This is land that is not available
for development and also that is not taxed.
The SRS was put into place to help communities that were
struggling due to the downturn of the timber industries and was
to be revoked when the markets turned around or when counties
formed a better way to support their economies. While the
timber market is the lowest it has been in several years and
when the Forest Service owns the majority of your county and
you're in a rural location, there's not much opportunity to
expand your economy.
Pocahontas County Schools have around 980 students enrolled
this year. We operate one high school, two middle schools and
three elementary schools. Working with a limited budget and
previous SRS payments, very careful decisions must be made
about how every dollar is spent. However, within these
constraints, our school system has some proud achievements.
Green Bank Elementary-Middle School partnered with volunteer
scientists from the Green Bank Observatory, and formed their
first Lego Robotics team. After winning a regional competition,
they went on to the world championship held in Detroit,
Michigan, in 2019.
We have excellent vocational programs at the high school,
and last year the Forestry Team brought home their eighth
national championship at the National FFA Convention.
But the scholastic subject that has garnered us the most
recognition is our innovative math and STEM curriculums.
Several schools now have STEM clubs and activities, staffed
with teachers and volunteers. With the help of a local school
teacher serving as coach, Pocahontas County has become one of
the top performers in state achievement testing in math. We now
have partnered with the National Science Foundation, West
Virginia University and the American Institute for Research to
provide training for math teachers from around the state. This
shows that rural does not mean restricted.
These types of successes are what is at stake if we
continue to lose funds. Like many small rural systems in West
Virginia, Pocahontas County is always searching for money. We
try to operate as frugally as we can, but with requirements,
new positions and new programs that are not always funded, some
cuts are required and most of these are very important.
Pocahontas County Schools must deal with special issues that
are unique to rural counties. For example, transportation is
one of our biggest expenses. It has a budget of almost $1.3
million. Reaching every student in our extensive county
involves bus routes of many miles, ages of all children of
different ages riding the bus and, in some cases, for over an
hour and a half.
Another troubling issue revolves around unemployment and
the opioid crisis. The social, emotional and educational
stressors these problems place on our students require the help
of well qualified psychologists, counselors that are currently
not available because of lack in funding.
There are also three other areas that we lack, that impacts
our children. First, our facilities are in desperate need of
replacement and maintenance. Our newest school is 30 years old
and our oldest one is 50, and only one actually has air
conditioning in it.
Second, our security needs to be drastically updated and
revised. We have no school resource officers and with limited
monies for safety measures, emergency services sometimes can be
far away. Safety becomes even more vital.
Finally, as much as we enjoy the academic accomplishments
of our students, the truth is, the lack of reliable internet
and broadband sometimes hamstrings our progress. Students that
are taking required tests at our high school often can only do
a few at a time and even sometimes they are kicked off while
taking a test.
Chairman Murkowski, Ranking Member Manchin and members of
the Committee, thank you again for inviting me here today. It
has been an honor and a privilege. I urge you all to heed our
concerns and enact the bill that will give a stable and
permanent solution to SRS. The loss of these funds will surely
be crippling to counties like ours all across the nation and
our school system would be happy to help in any way possible to
help find a permanent solution.
Thank you, again.
[The prepared statement of Mr. Dilley follows:]
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The Chairman. Thank you, Mr. Dilley. Thank you for sharing
that.
Mayor Prysunka, welcome.
STATEMENT OF HON. STEPHEN PRYSUNKA, MAYOR, WRANGELL CITY AND
BOROUGH, ALASKA, ON BEHALF OF THE NATIONAL ASSOCIATION OF
COUNTIES
Mr. Prysunka. Good morning, Chairman Murkowski, Ranking
Member Manchin and members of the Committee. Thank you for
holding today's hearing on PILT and the SRS programs and for
inviting me to testify on behalf of the National Association of
Counties, NACo, and the nation's 3,069 counties.
My name is Stephen Prysunka, and I'm the Mayor of the City
and Borough of Wrangell, Alaska. Wrangell is in Southeast
Alaska between Ketchikan and Juneau. If you've ever taken a
cruise through Alaska, you likely steamed right by our
community but you more than likely steamed right by our lands.
Although I represent our municipal government, I also bring
a warm greeting from our Wrangell Cooperative Association, the
Shtax'heen Kwaan Tribal Government which represents 740 native
residents in our area. We work closely with the tribal
government to collaborate for the benefit of all community
members.
Wrangell Borough has a population of roughly 2,500
residents and it's nearly 3,500 square miles in size--or about
1.63 million acres. You could fit Washington, DC, 50 times over
into our borough. I know very well the challenges public lands
and national forest counties face as we seek to provide our
residents and visitors with essential services in the face of
strict revenue and budgetary constraints. My testimony today
offers the local perspective on PILT, SRS and specific
legislation to improve these programs.
Rural public land counties face the pressure of smaller tax
bases caused by large tracts of untaxable federal lands within
their jurisdiction, along with fewer residents and businesses
producing revenue. Our borough is geographically large but 97
percent of the land within our boundaries is within the Tongass
National Forest and cannot be developed. This severely
restricts our ability to grow our economy to create the tax
base necessary to provide the legally-mandated services to
residents and visitors alike. There is no small community
exemption to relax a rule for sewage treatment, emergency
services or education standards.
PILT particularly addresses lost property tax revenue for
counties like mine. Last year Wrangell received approximately
$470,000, or about $0.29 per acre, from PILT. Overall, PILT
funding accounts for approximately seven percent of our annual
general fund budget and is used for emergency services such as
fire protection and law enforcement. Wrangell relies on these
funds to maintain and improve critical infrastructure that any
community needs to attract businesses and grow its economy in
the long-term. PILT directly impacts the quality of life and
economic well-being of our community. Losing PILT would result
in the loss of important vital services and the uncertainty at
the annual Congressional appropriation cycle leaves local
government budgets hanging in the balance. Counties support
making full funding PILT and making it mandatory in the long-
term.
Earlier this year, the legislation was reintroduced in both
the House and Senate to accomplish this. The counties support
passage of either of these bipartisan bills, H.R. 3043, the
Permanently Authorizing PILT Act, to make PILT a fully-funded,
mandatory program moving forward, or S. 2480, the PILT
Reauthorization Act of 2019, to make PILT mandatory for the
next ten years. Counties also strongly support S. 2108, the
Small County PILT Parity Act, which creates new, larger
monetary caps under PILT for counties with populations below
5,000 without affecting PILT payments to more populous
counties. This is a positive step to leveling the playing field
for public land counties.
Should this legislation be enacted, Wrangell Borough would
see an estimated $167,000 increase in our PILT payment.
Historically, rural counties and schools have relied on a 25
percent share of receipts from timber harvest to supplement
local funding for education services and roads. Over the past
30 years, these revenues have dropped considerably. SRS was
developed to aid those impacted communities. Last year,
Wrangell received $986,000 in Title I SRS funding which
represents nearly one-sixth of our school district's annual
budget. Losing SRS would be catastrophic to our schools as
timber receipts alone would only make up four percent of our
SRS payment. To prevent this, counties are asking Congress to
pass S. 430 which would reauthorize SRS for an additional two
years.
As long-term funding solutions for SRS, counties support
the Forest Management for Rural Stability Act, S. 1643. This
bipartisan bill would create an endowment fund to make
permanent SRS payments and eliminate their annual five percent
reduction. The bill would also create flexibility in the use of
SRS funds to achieve our mutual forest health and economic
development goals. Counties hope Congress will act on this
legislation soon.
Again, thank you for the opportunity to share Wrangell
Borough's perspective on PILT and SRS. Counties are depending
on Congress to meet this federal obligation to our communities
by supporting vital funding for emergency personnel,
infrastructure, school teachers and other public services. We
ask you to act to protect and improve these essential programs
in the Fiscal Year 2020 Appropriations package and in the long-
term.
Thank you.
[The prepared statement of Mr. Prysunka follows:]
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The Chairman. Thank you, Mayor.
Mr. Rowley, welcome to the Committee.
STATEMENT OF ALLEN ROWLEY, ASSOCIATE DEPUTY CHIEF, NATIONAL
FOREST SYSTEM, USDA FOREST SERVICE
Mr. Rowley. Good morning and thank you. Madam Chairman,
Ranking Member and members of the Committee, thanks for
inviting me here today. I hope my testimony and that from the
rest of the panel will help you with some ideas for a durable
solution to this problem. I'll focus my testimony on
implementation of SRS and give you some views from the
Department of Agriculture on Senate bill 430 as well as Senate
bill 1643.
The history piece, many of you know, but as a reminder--
soon after the creation of the Forest Service in 1908 Congress
passed the Twenty-Five Percent Fund Act to compensate local
governments for those lands that were under National Forest
System management that were not eligible for property taxes,
and that was 25 percent of the gross receipts earned off of
those lands for activities like timber sales, grazing, mining,
recreation activities, et cetera. The money was dispersed to
the state who then would disperse it to counties at their
discretion.
In the 1980s there was a significant drop in timber sales,
particularly in California, Oregon and Washington which led to
the reduced and wildly fluctuating payments that previous
panels members have mentioned. To address that concern,
Congress provided some safety net payments for counties in
California, Washington and Oregon from 1994 to 2003. And those
safety nets were, again, higher than the 25 percent of the
gross receipts. In 2000, Congress created the Secure Rural
Schools and Community Self-Determination Act, or SRS.
Approximately 74 counties chose to remain under the 25 percent
gross receipts. More importantly, 744 counties chose to
participate in the larger full payment under SRS.
To give you an example of how SRS is deployed. If I turn to
Fiscal Year 2018, approximately $225 million was paid to states
to distribute to counties in 2018. If that were applied as the
25 percent fund nationwide, it would have been, 20 percent of
that amount would have been available to counties, as many of
you have already commented in your opening remarks.
I would like to say that in addition to the higher and more
predictable payments under SRS, there's another piece of that
under Title II that has great value, setting up Resource
Advisory Committees, or RACs, under the Federal Advisory
Committee Act, what I describe as diverse, local, grassroots,
citizens-based committees to engage in National Forest
management decisions and influence on the allocation of
additional funds for active forest management, projects like
road improvements, campground improvements, range improvements,
noxious weed treatments and timber sales that are supported by
and recommended by the citizens. It's not a random project the
agency had identified, it's work the community wanted to see
happen. This collaboration and engagement with the citizens has
been a great benefit to all those involved. I do want to
mention that the work to maintain Resource Advisory Committees
that meet all the requirements of SRS has been work for us. We
can talk about that later, if you'd like.
Turning to Senate bill 430, USDA recognizes the
contribution of SRS payments and revenue sharing with counties
and the positive impact that's had on local governments. We are
interested in sharing. The Federal Government can fulfill its
role being a good neighbor to local communities as we work to
continue to ensure efficient and effective management and a
term from the West, being a neighbor is, in fact, a verb. It's
not a noun. It's that working with the community.
If the SRS payment authority is extended through two years
as proposed in Senate bill 430, we look forward to exploring
with you potential changes on the administrative process like
streamlining the RAC memberships to keep them all functional
and looking for ways to increase flexibility to counties and
how they receive the funds.
Turning to Senate bill 1643, we are also supportive of the
effort and source to find stable funding. While these were not
in the Administration's proposal, we would like to continue to
work with you and local stakeholders to develop a stable
program into the future and address those same administrative
challenges I mentioned earlier.
Thanks, and I look forward to further discussion with all
of you.
[The prepared statement of Mr. Rowley follows:]
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The Chairman. Thank you, Mr. Rowley.
Ms. Flanagan, welcome and thank you for joining the
Committee this morning and allowing us to go from the local
here to the Department. So thank you.
STATEMENT OF DENISE FLANAGAN, DIRECTOR OF BUDGET, U.S.
DEPARTMENT OF THE INTERIOR
Ms. Flanagan. Thank you.
Good morning, Chairman Murkowski, Ranking Member Manchin
and members of the Committee, thank you for the opportunity to
testify on behalf of Interior's federal lands payments programs
and the three bills pending before the Committee. My name is
Denise Flanagan. I'm the Director of the Department of the
Interior's Office of Budget, and my office manages the Payments
In Lieu of Taxes program, or the PILT program, for the
Department of the Interior. Interior, through the Bureau of
Land Management, manages a small portion of the payments made
under the Secure Rural Schools Act; however, the U.S. Forest
Service manages the majority of that program.
My remarks today will focus on the PILT program which is an
important way for the Federal Government to be a good neighbor
to local communities across the country. The program
compensates local governments, recognizing the non-taxable
federal lands within their boundaries. Counties have the
flexibility to use PILT payments for any governmental purpose
depending on the laws of the individual states. PILT funds
often pay for essential public services such as firefighting
and police protection, construction of public schools and roads
and search and rescue operations. Since the program began in
1977, Interior has distributed approximately $9.2 billion in
PILT payments to counties. In 2019, Interior sent $515.7
million in PILT payments to more than 1,900 counties across the
country.
The PILT law provides specific direction for calculating
PILT payments based on qualifying acreage, population and prior
year revenue payments. Each year we work with states and local
governments to update this information. We coordinate across
Interior's bureaus with the Forest Service and other federal
agencies to ensure that we have accurate data on acreage on
which to base the payment. We also work closely with states to
ensure we have the correct amounts of prior year revenue
payments retained by counties. We're audited on this data
annually, and we work closely with the counties to inform them
of any changes to the process and post information about the
payments publicly to ensure transparency. We also work
individually with the states and counties to answer any
questions and to seek clarification as we review the submitted
payment information.
Funding for PILT has varied as mandatory and discretionary
funding. The original authorization provided mandatory funding
for full calculated payments from Fiscal Year 2008 to 2012.
After that, funding authority has either been extended on a
year-to-year basis or in Fiscal Year 2015 as a combination of
mandatory and discretionary funding or as discretionary
appropriations in Fiscal Year '16 and '17. The Fiscal Year '18
and '19 programs were funded as an extension of the
authorization for full program funding in the Interior and
Environmental Appropriations bill. Both the House and Senate
marks for Fiscal Year 2020 continue this approach.
In light of pending Congressional action on Fiscal Year
2020 funding, Interior anticipates making PILT payments this
Fiscal Year. Depending on the timing of Congressional action,
we will work to make the Fiscal Year 2020 PILT payments by June
30th, as we have in prior years.
Today the Committee is considering S. 2108, the Small
County PILT Parity Act. We've reviewed how the legislation
would affect local governments receiving PILT payments. The
legislation proposes to increase the maximum allowable payment
to local governments with populations of fewer than 5,000
people. The current payment structure does not reach below the
5,000 population mark. Assuming the Fiscal Year 2019
information, the Department estimates the legislation would
impact approximately 300 units of local government currently
receiving PILT payments. The current legislation is estimated
to increase total annual PILT payments by approximately $2
million. Should Congress choose to adopt the population dollar
value table contained in Senate bill 2108, the Department will
manage the PILT program in accordance with the law.
This concludes my oral statement. Again, thanks for the
opportunity to join you today. I'm happy to answer any
questions.
[The prepared statement of Ms. Flanagan follows:]
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The Chairman. Thank you, all. We appreciate the testimony
and now the opportunity to go back and forth with questions.
Ms. Flanagan, I want to start quickly with you because
there is this linkage between PILT and SRS which, I think, is
oftentimes either misunderstood or not even recognized. Can you
explain the linkage there? It is my understanding that if SRS
payments are not reauthorized, that PILT payments are impacted.
Can you explain how those PILT payments would then be impacted
if SRS is not reauthorized?
Ms. Flanagan. Certainly.
You're absolutely correct. If SRS is not reauthorized, we
would expect the PILT payment calculation to increase and that
is because the SRS payments are a deduction under the prior
year payments for the PILT program.
The Chairman. So because they are a deduction. One of the
things that we talk about here is the certainty to communities
in terms of not only what you will receive, but when you will
receive it. So there would be further uncertainty in terms of
the amount that counties or communities would receive if we
don't appreciate the linkage between the two accounts, between
PILT and SRS.
Ms. Flanagan. Absolutely. For example----
The Chairman. Go ahead.
Ms. Flanagan. Yes, for example, the expiration of SRS in
Fiscal Year 2018 doesn't impact the Fiscal Year 2020 PILT
payment and the reason that is is because the authorized
payment for SRS was made in 2019. But payments made under SRS
in one year, they're deductible under the PILT program in the
following year.
The Chairman. So we have PILT that will be paid out, you
said, in June 2020. If we fail to reauthorize SRS now, what is
the impact on the 2020 payments?
Ms. Flanagan. The 2020 payments will not have any impact.
The Chairman. It would be the----
Ms. Flanagan. It would be the 2021 payments that will have
an impact.
The Chairman. I understand. Okay.
Ms. Flanagan. It will be expected to increase.
The Chairman. I understand that.
Let me go to you, Mayor Prysunka, and this also speaks to
the uncertainty because you mention that with the SRS payments
that come to Wrangell, it is one-sixth of the school district's
annual budget.
Mr. Prysunka. That's correct.
The Chairman. If we are in a situation where we go back to
the 25 percent rule which is something that we really have not
talked about here today, but I think we need to because that is
where it takes us back if we don't reauthorize. What do you do
with your school district? When do you make the decisions about
whether or not you have the resources to bring back the art
teacher or the music teacher or the counselor or what you are
going to be doing with extracurricular activities? Can you just
speak about the real-world impacts of this type of uncertainty
that would be a huge kick to your overall budget?
Mr. Prysunka. Certainly.
Well, one of the things that happens is we try to renew the
teachers' contracts in a timely manner because in Alaska,
teachers, sort of, do a shuffle. There's a big shuffle. And if
we are uncertain about our funding it creates uncertainty for
how many teachers we're going to be able to afford. And of
course, we're always going to err on the side of the
extracurricular activities and non-core items, but it makes it
difficult for us to lock down our teachers moving forward with
the contracts going into the following year. So it's always
nice if we know the funding is there and we're able to move
forward.
One of the things that happens in a rural setting is that
we don't have the opportunities that an urban center has. So by
that, I mean, if--my children went through public school in
Wrangell. It's what we have and, you know, for example, the
dance lessons. That's through the school. There's no private
dance club, so it's an after-school activity for kids to do.
The sporting activities, there's no other options for sporting
activities in our community. Everything is run through the
school. So if we lose those extracurricular activities because
we don't have the funding to move forward, those opportunities
are lost. We can try to do some pickup through the city parks
and rec program, but those activities are gone.
But the biggest thing for us is certainty with our
teachers. We want to be able to let them know early that
they're going to have contracts for the following year and we
know how to hire moving forward, that we don't want to hire
positions that we're not going to be able to fund moving into
the next school year. And as you know, moving in and out of the
villages, out of the communities, it's difficult. And it takes
time to go and recruit and to bring new teachers down into the
community. So it has a huge impact on our school system.
The Chairman. Well, I thank you for that. I think, as we
appreciate the significance of the actual dollars and what they
mean, timing with regards to these programs and the certainty
of payout to the communities is also critically important
because once that teacher makes the decision to leave, it is
pretty hard, as you say, to get them back. Thank you for that.
I will turn to Senator Wyden now.
Senator Wyden. Thank you, Madam Chair and, again, Madam
Chair, thank you for having this hearing.
I want to just pick up on where we are, kind of, looking
back and then looking forward. So in this room we wrote Secure
Rural Schools. It has done a lot of good, but clearly there are
areas where we have to do better. I mean, when people tell me
hey, we like this because otherwise we would have had three
days of school, I say, great, but aren't you still having
problems with your roads and your law enforcement and you have
still got challenges having foreign languages or after school
programs? So we have to do better. In particular, we have to
get rural communities off this roller coaster where they just
have to wait, kind of like the perils of Pauline, to the last
minute trying to figure out if they are going to have money to
fix their road and the like.
So where we are is, we are going to have to figure out how
to get Secure Rural Schools for another couple of years at
least and we have to lock that down because without that safety
net all the problems that Mr. Dilley and all of you have talked
about will get even more serious. So that is priority business
number one.
Then what we want to do, starting today, is flesh out this
endowment kind of approach. I just want to tell you what
Senators Crapo, Risch, Merkley and I have introduced. This
would be a permanent endowment fund so that you would have
money for schools and roads and basic services. The Congress
would make an initial investment into the fund. The principle
gets invested and the interest is used to make the county
payments for these essential services. Because of the initial
seed money provided by the Congress, at no time would county
payments drop below the 2017 levels and that has been important
to counties as well. We have worked with the National
Association of Counties, of course, on this.
As I talked about earlier, we are multiple use people on
this, you know, the Committee. We understand protecting special
places, but we are for multiple use as well and we want to see
the safety net grow. So the legislation deposits forest revenue
sharing payments into the endowment each year to increase the
county payments. So, in effect, as the forests are more
appropriately managed and as timber harvests grow, so too will
payments to the counties.
So what is this all about? Stable, reliable funding, no
more roller coaster and a continued commitment to the link
between forest management and the economic vitality of rural
counties across the country.
Now I mentioned that we have to have Secure Rural Schools,
that we get the endowment in place, but I want to ask you, Mr.
Rowley, so the record is clear about the question that Senator
Craig and I were confronted with when we got this program off
to the races and that is, the Administration understands that
there will be no compromise of environmental values, no breach
of the federal environmental laws; federal environmental laws,
as we envision it in an endowment approach--and we will, of
course, continue to work with the Administration on this--is a
bedrock requirement and you all understand that and are
supportive of it.
Mr. Rowley. Thank you for that history and absolutely so.
There's nothing in this bill that would even begin to suggest
we should vary from complying with the National Environmental
Policy Act, the Endangered Species Act, Clean Water Act, Clean
Air Act or any of those other laws that are asking for
environmental protections. That is a totally separate issue and
not tied to this funding conversation. So thanks for asking.
Senator Wyden. Very good, and I think my colleagues may
also want to get into this. We always, at home, have this
debate between coupling and decoupling the county payments. I
think the Chair and I have talked about this over the years and
revenue sharing. What the endowment proposal has sought to do
working with the counties is to try to find a, kind of, perhaps
more nimble way, sometimes people want to call it elegant, I
will settle for nimble, way to increase payments to counties
without directly coupling it to revenue sharing. It is a way
to, kind of, transcend all of the complications associated with
it and you all have made it clear.
In fact, I will just go down the row. Does anybody have any
problem--I have my time expiring--protecting the language that
ensures that bedrock environmental laws are going to be
continued as we try to go forward with a modernized, kind of,
forestry stool, as I have described it. Let's just go down the
row. Any problem?
Ms. Flanagan. No.
Senator Wyden. Good. Mr. Rowley has already said yes and I
think the local communities and the National Association.
Alright.
Madam--Mr. Recorder, let it be noted that we have asked
explicitly at this first hearing with respect to the endowment
of the agencies, of the local communities of something that has
been always, kind of, controversial when we have talked about
this in the past.
I want to thank all of you for your cooperation. This is
going to be a thoroughly bipartisan effort. It was in creating
the predecessor of it, and now we are, kind of, updating the
stool.
Madam Chair, I look forward to working with you. We have
worked on this a long time, and under your leadership I think
we have an opportunity to really modernize what we are doing to
help the communities.
The Chairman. Well, we are looking for a long-term
solution, so thank you for your guidance on this.
Senator Wyden. Thank you.
The Chairman. Senator Gardner.
Senator Gardner. Thank you, Madam Chair, and thank you to
the Ranking Member for this hearing today. Obviously these
programs are incredibly important to so many of my Colorado
counties and constituents throughout the state. In fact, 56 of
Colorado's 64 counties receive PILT payments from the
Department of the Interior to offset the non-taxable, federal
land within those counties. That amounted, in 2019, to just
under $40 million that was being distributed to Colorado
counties. So a big chunk of change. The last payments under the
now expired SRS formula distributed by the Forest Service
earlier this June meant to counties containing National Forest
received a share of over $11 million. We have co-sponsored
legislation, many of us on this Committee, a bill by Senator
Crapo that is reauthorizing or being discussed to reauthorize
SRS.
Every year I sign letters along with so many of my
colleagues to leadership and appropriators urging them to fully
fund PILT and to reauthorize SRS. But when I go to communities,
they have that uncertainty when they are putting their budgets
together. They don't know what they can tell the sheriff's
office. They don't know what they can tell other partners
within the county governments about what is going to happen to
their county budgets. We have to think about these ideas that
so many on this Committee have talked about today, longer-term
solutions that will provide certainty to counties and reinforce
the Federal Government's commitment to them for these public
lands that we, indeed, all share, because the federal land is
not going to go anywhere and neither is the obligation that we
owe to the counties containing it.
So I was proud to join Senator Wyden as an original sponsor
of the PILT Reauthorization Act that would extend the program's
authorization through 2029 and get out of this one- or two-year
funk that these counties face and creates so many problems for
them.
I know Senator Daines talked about some of his counties. I
want to talk about one in Colorado, Hinsdale County, Colorado,
for a little minute. It is a great example of why I am happy to
be an original co-sponsor of the Small County PILT Parity Act
that Senator Daines is leading. Hinsdale County is located in
the South-southwest area of Colorado. It has three different
national forests within it. It has the Rio Grande National
Forest, the San Juan National Forest and the Grand Mesa,
Uncompahgre and Gunnison National Forests, so GMUG. The size of
the county is approximately 1,120 square miles. It ranks 40th
out of 64 counties in the state for land area. That is still a
big, 1,120 square miles, but it is only 40th out of 64 counties
in the state in terms of land area. It has a population of less
than 850 people. It is the least densely populated county in
the state, it is one of the most remote areas in the Lower 48
states and it is just magnificent in its beauty.
For comparison sake, Rhode Island is slightly smaller than
Hinsdale County, slightly smaller than Hinsdale County, but it
has a population of over one million people. Hinsdale County
should have two United States Senators. The big difference is
that 95 percent of the lands in Hinsdale County is federal
land, 95 percent. So under the proposed bill Hinsdale's PILT
program would go up, the payment would go up, but let's talk
about what they got in terms of 2018 for context about why the
program is important and why that matters to counties with a
federal footprint. Hinsdale County received about $143,000 from
PILT and $67,000 from SRS. Their overall income as a county in
2018 was about $6 million. In the context of a $6 million
budget, the chance of a swing of a couple hundred thousand
dollars, thousands of dollars actually, would be extremely
impactful.
I have been told by a previous county commission there that
between 40 and 50 percent of the county's road and bridges
budget comes from these programs. This is a county that if you
ever take the Alpine Loop in Colorado, you are going to go
through part of Hinsdale County. One of the issues they were
dealing with off of our federal lands this year was a high
number of avalanches that they dealt with--they had to dig out
this stretch of the road, that was primarily the county's
responsibility, so that 100,000+ visitors a year could enjoy
the Alpine Loop all from this federal land.
So while the cost of the bill is estimated at $2 million,
that might seem small in terms of Washington talk or pencil
dust here, but it can have a huge impact on these sparsely
populated counties and I hope that we can do something on this
because those federal funds make up such a huge portion of our
county budgets.
Mr. Rowley, a quick question for you. Stewardship goals of
land management at agencies like the Forest Service, how are
they affected with the uncertainties in PILT if a county is not
aware of how the PILT dollars, SRS dollars are going to come
through?
Mr. Rowley. So in terms of our stewardship obligations in
land management, I'll say that good neighbor authority
contracts and stewardship contracts aren't added into that 25
percent fund calculation. So that's an issue we'd be happy to
work with you on in terms of finding other solutions. A lot, we
find great community support for our projects which means they
move quicker with less objections when we use good neighbor
authority or stewardship contracting. And so that's a great
tool for us and we recognize that impact on the back end, and
we'd be happy to work with you on finding a different solution
there if you were interested.
Senator Gardner. Thanks.
And then one quick question on Resource Advisory Committee
vacancies, the Farm Bill Pilot Program that allowed regional
forester authority to approve applications to fill vacancies.
We have anecdotal evidence that where that authority has been
granted, we have those vacancies filled on the RACs. Is that
something that you see greater utilization of or the ability to
get more positions filled on the RACs?
Mr. Rowley. So in the 2018 Farm bill, with help of many of
you, we have the pilot programs in the States of Montana and
Arizona. In Montana, we were able to get Resource Advisory
Committees, 9 of 12 that were suffering without a quorum to get
filled. Arizona, 2 of 4. In some cases, we were able to move
within 60 days through the administrative process. Moving
decisions closest to the point of implementation is often,
makes things faster and that looks like a wonderful tool for us
to leverage.
Senator Gardner. Thank you very much. Thanks, Madam Chair.
The Chairman. Thank you, Senator Gardner.
Senator Heinrich.
Senator Heinrich. Thank you, Madam Chair.
I think we all, or at least those of us on the Committee
from Western states, really understand how important this is
that we reauthorize and fund SRS. But I also think we are, sort
of, approaching this from the hand we have been dealt, you
know, we have 122-year-old Organic Act now. I think it is
helpful to, sort of, step back and realize that the question we
are really trying to answer is, in the 21st century, how do you
connect directly, economically, the values and services that
America wants and needs from its public lands and its national
forests with the economic vitality of the rural communities
that live and work in those places?
Our metrics from 100 years ago, rightfully so, were all
about board feet. This country was built on wood. There was a
time when wood was energy as well as what built everything.
Today our country is valuing different metrics from our
national forests. We need clean water production, whether that
is for salmon or irrigation or for the cities, cities like
Albuquerque that get their drinking water and the water that
creates their economic development opportunities from national
forests ranging from Southern Colorado to all across Northern
New Mexico.
We should be valuing carbon sequestration in those forests.
And we should be valuing wildlife-friendly, fire-resistant
forests that generate the kind of recreational opportunities
whether that is hunting or fishing or whatever, that Americans
all across this country are spending billions of dollars on
every year. Then we need to figure out how do we make sure that
counties who live and work in these places actually get the
benefits of that value because that is not happening today. SRS
is an attempt at that, but I think we would all recognize that
we are not doing justice to our rural communities today.
So I just think it is helpful to take a step back and think
about what do we want from our public lands in the 21st century
and how do we make sure that the communities that can produce
those things directly have a stake in the economic benefits of
that?
Mr. Rowley, in your testimony you mentioned that the
Administration has not proposed reauthorizing the Secure Rural
Schools program. Does that mean that the Administration opposes
reauthorizing the program?
Mr. Rowley. I would take that as a signal that managing the
whole country and the federal estate, the Administration is
trying to set some priorities and pick some high leverage moves
for themselves.
Senator Heinrich. Okay.
Mr. Rowley. And so, I defer back to the Committee on how
your voice may come into the room in terms of priorities.
Senator Heinrich. I just want to bring this down to reality
with respect to one county again, and a lot of us have used
counties for examples in all of this. Catron County in New
Mexico received $2.7 million from SRS last year. I think that
was money well-deserved and well-spent. Their 25 percent
payment, if they had only received funds based on forest
receipts would be less than $107,000. If we don't reauthorize
SRS this year, that is an immediate cut of 96 percent for
Catron County.
If you look at New Mexico as a whole, an end to SRS would
cost my counties in the state nearly $9.5 million, or a 92
percent immediate cut. So, you know, this idea that we are
going to use additional timber sales to make them somehow
harmless is not credible. If you look at what it would take in
New Mexico alone to hold New Mexico counties harmless without
SRS, it would require a 1,200 percent increase in commercial
timber harvest.
Mr. Rowley, is that even a realistic or credible number?
Mr. Rowley. Well, your math is credible. Let me reflect,
it's hard to imagine a 1,200 percent increase in the level of
timber harvest on the Gila National Forest.
Senator Heinrich. Yes, we don't have the mills to do it or
the workforce. I do think we need to live in the world of and
reality today and then think about how do we restructure these
things to really benefit these communities in the long run.
Thank you.
The Chairman. Thank you, Senator.
Senator Daines.
Senator Daines. Chair Murkowski, I would first like to ask
unanimous consent that the letters of support that I have from
the National Association of Counties, from the Montana, Nevada
and New Mexico Associations of Counties and others be included
in the record.
The Chairman. They will be included.
Senator Daines. Thank you.
[Letters of support follow.]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Senator Daines. Ms. Flanagan, if my bill was passed into
law tomorrow, how would small counties benefit?
Ms. Flanagan. Small counties would benefit because the bill
is the Small County Parity Act, and so it provides a different
table for us to use to calculate PILT. And so small counties of
populations under 5,000 will receive, would receive additional
funds.
Senator Daines. I have eight counties that fit that
criteria today in Montana. Of course, the other 48 counties
have a very important question. And that is, if PILT is fully
funded, would you please confirm that my bill would have no
effect on counties with more than 5,000 people?
Ms. Flanagan. Yes. Yes----
Senator Daines. That is correct.
Ms. Flanagan. ----assuming Fiscal Year 2019 information,
what this does is change the variable for counties under 5,000.
It does not impact the variables----
Senator Daines. But it does not take away from the larger
counties?
Ms. Flanagan. Correct.
Senator Daines. Thank you.
I want to also comment on my support for Secure Rural
Schools as well. Like PILT, SRS is extremely important for our
rural forested counties and I believe we need to extend the
program again. While I am very open-minded to the legislation
creating an endowment fund for forested counties, I believe the
very best way to provide these counties long-term certainty is
to increase active forest management on our national forests to
bring back these mills and these jobs that have been lost
because of difficulties managing on our federal forests.
I have and will continue to push for sensible, bipartisan
reforms that will increase forest management, including
addressing the chronic litigation that we see, particularly in
Montana and other places out West, from fringe groups and
accelerating also environmental review. We need to speed this
process up. I applaud the Trump Administration for taking
decisive steps to restore active management.
Mr. Rowley, on a related matter, the Forest Service has
identified the infamous Cottonwood decision as a continued
barrier to timely forest management, particularly relating to
the new information trigger under the Endangered Species Act.
Can you speak to your concerns about recent litigation
involving new information claims and why the Forest Service
believes Cottonwood imposes a crippling paperwork burden
without advancing conservation goals?
Mr. Rowley. Thank you, Senator, for your questions and your
comments. This single decision opens the door for other folks
to file carbon copy complaints against National Forest System
management standing on the ground of new information. And I
would just ask, so when does that stop? We make a decision on
today and tomorrow we might learn something new and there are
groups that would say, oh, that's something new, new
information, you should go back and do it over again, the
project and the analysis. Since the Cottonwood decision we've
received numerous carbon copy lawsuits or complaints about our
activities that are slowing us down substantially.
Senator Daines. How big a deal is the Cottonwood decision
and how that affects active forest management?
Mr. Rowley. I think there is, the number, I believe, was in
excess of 30 different complaints that are following that
pattern. Currently, there's a complaint that involves the Idaho
panhandle of the Kootenai and the Lolo National Forests that
has us, had us, stop active timber sales to back up and answer
the complaint. They were sales that were awarded, and we
stopped operations. That's a direct and real impact as we work
through litigation. That's an example.
Senator Daines. Thank you. Thank you, Chair Murkowski.
The Chairman. Thank you, Senator.
Senator Cortez Masto.
Senator Cortez Masto. Thank you, Madam Chair, Ranking
Member Manchin, for holding this hearing.
I cannot stress enough how important PILT and SRS are to
the State of Nevada. Over 80 percent of the land in Nevada is
owned by the Federal Government, and a majority of that is the
BLM. I will tell you there are 17 counties in the State of
Nevada that rely on PILT and receive PILT funding and 14 of
them receive SRS funding.
Let me jump back, there are several counties where 90
percent or over 90 percent of the land is owned by the Federal
Government. I do appreciate my colleague from New Mexico,
Senator Heinrich, and his comments here. How do we look at, in
this day and age, how do we address that economic impact and
should we be looking at other ways of bringing and allowing
these counties to partake in more of that economic impact? The
Federal Government has to be a good steward and work with our
counties. And that is why I do support S. 430 to extend the
Secure Rural Schools and Community Self-Determination Act, and
I am co-sponsoring S. 2108, the Small County PILT Parity Act,
as well.
But something I think is really important for the public
and those who may be watching to understand is I have been here
for three years now, and I have watched as this Administration
has either cut or zeroed out funding for these programs. I
cannot thank enough Chairwoman Murkowski and the leaders in
Congress who keep putting the money back in, recognizing how it
is so important for communities across this country. I need to
stress that.
Ms. Flanagan, can you talk a little bit about what the
impact to PILT funding will be in the future if SRS is not
reauthorized? I know Chairwoman Murkowski talked a little bit
about this. Can you talk some more about that, if you would?
Ms. Flanagan. Certainly. If SRS is not reauthorized then
the overall PILT payment calculations will increase in the
future. And the reason----
Senator Cortez Masto. Will increase or will not increase?
Ms. Flanagan. Will increase.
Senator Cortez Masto. So if SRS is not authorized PILT will
increase?
Ms. Flanagan. Yes, PILT will increase.
Senator Cortez Masto. Okay, why is that?
Ms. Flanagan. PILT will increase because SRS is, under the
statute, one of the prior year deductions in calculating PILT.
So, for example, for Fiscal Year '20 the expiration in Fiscal
Year '18 of SRS the payments were made in Fiscal Year '19 and
so in the Fiscal Year 2020 PILT calculation those SRS payments
are part of the prior year deductions in calculating PILT.
Senator Cortez Masto. So it is safe for me to go back to my
counties to say if SRS is not reauthorized, in the future your
PILT payments will increase?
Ms. Flanagan. Generally, PILT payments will increase.
Senator Cortez Masto. Will it increase to cover the loss
that they will receive from not receiving the SRS payments?
Ms. Flanagan. PILT variables, there's four key variables:
acreage, federal acreage; population; prior year payments and
in the prior year payments there are several federal payments
that are named in the PILT Act, including Secure Rural Schools,
Mineral Leasing Act, National Forest Fund and Taylor Grazing;
and then inflation also impacts the variables. So those four
variables, we gather that information every year and then
that's how we calculate the PILT payment. So we're not able to
do a direct comparison but generally if SRS goes down, PILT
payments will increase.
Senator Cortez Masto. It will go up.
Is it possible some of the counties may see an increase in
PILT, but not enough to cover the loss from the SRS? Lack of
reauthorization?
Ms. Flanagan. That's possible.
Senator Cortez Masto. Okay. I would love to sit down with
you and kind of get a sense of that for the future and the
impact to my counties. Thank you for being here.
Ms. Flanagan. Sure, we're happy to do that.
Senator Cortez Masto. I appreciate that.
Mr. Rowley, you talked a little bit in your testimony about
exploring potential changes to the administrative provisions
implementing S. 430 including the lengthy RAC member nomination
process. I would love to hear a little bit more about that and
the concerns about the current RAC nominations process, what
changes you would propose making and how those changes might
improve the RAC recommendations?
Mr. Rowley. Thank you, thank you for the question.
I think the shortest way to describe it, so far, the pilot
authority that was in the 2018 Farm Bill for Arizona and
Montana is a great model. We've been able to move through the
identification of additional RAC members, the vetting and their
certification to serve, in one case, in less than 60 days as
opposed to now, again, think of that, my model I would share
with you, the farther the decision away is from implementation,
the longer it takes. And so, providing regional foresters the
authority, they are much closer to implementation to staff and
decide on those RACs, looks like a high leverage move for us.
Senator Cortez Masto. So you would support adopting what
was piloted in the Ag Bill across----
Mr. Rowley. Exactly. And then also could include, should
include, adjustments to the mathematical quorum in cases like a
county in your state like Nye County or White Pine County
where, I don't know the exact population, it might be hard to
find all the positions identified on Secure Rural Schools. The
process in the Farm Bill allows us to change the quorum when a
county or a RAC goes through the effort to recruit all those
members and is not successful, we can shrink the size of the
quorum and that might have great utility in some of those
counties in Nevada.
Senator Cortez Masto. Yes, that sounds reasonable to me.
Thank you again for being here. I so appreciate it.
The Chairman. Thank you, Senator.
Senator McSally.
Senator McSally. Thank you, Chairwoman Murkowski and
Ranking Member Manchin. I really appreciate you holding this
hearing today, and thanks to our witnesses. I represent
Arizona. I have been an ardent and strong supporter of both
PILT and SRS since I have been in Congress, in the House and
now in the Senate. In Arizona 13 of our 15 counties are rural
counties and the Federal Government owns 70 percent of the land
across Arizona. That makes PILT crucial for these local
communities, and the overreaching policies in the past that
decimated the logging industry in Arizona and across the West
is why we have SRS in the first place.
I know we have had a good discussion today already about
the heavy presence of Federal Government in states like
Arizona. It is not just a talking point, it affects our local
communities for things like search and rescue, law enforcement,
education and all that has been discussed already. For example
though, Coconino County in Arizona, it is the largest by land
area and the second largest in the Lower 48 county in America
at 18,661 square miles. Coconino County is larger than Rhode
Island, Delaware, New Jersey and Massachusetts combined, but
only 13 percent of the county is private land. So they have to
use the small tax base to provide essential county services
like law enforcement, road maintenance, search and rescue,
those types of things. So PILT is vitally important across
Arizona.
Ms. Flanagan, I want to follow up. I know it has been
brought up now a couple times, but I want to be more specific
because we had representatives from counties in Arizona come to
us recently and they believe that if somehow SRS was no longer
around that their PILT payments would go down. I heard what you
have said now a couple of times that it would be recalculated
and PILT, in general, would go up, but PILT in general going up
does not mean PILT specifically in certain regions or counties
would go up.
So I just want to drill in a little more. You may not have
any calculations in front of you, but they believe in Arizona
that the PILT payments would go down if SRS went away. Can you
clarify if there would be regional or local differences that
actually would be lower than today, lower PILT?
Ms. Flanagan. So, in general, again, generally, for each
county when we calculate PILT payments, it's based upon four
variables, the acreage in the county----
Senator McSally. Okay.
Ms. Flanagan. ----you know, which can change----
Senator McSally. Yes.
Ms. Flanagan. ----from year-to-year, the population of the
county which can change from year-to-year----
Senator McSally. Right.
Ms. Flanagan. ----the prior year payment deductions----
Senator McSally. Okay.
Ms. Flanagan. ----which can vary from year-to-year and
then, inflation which varies from year-to-year.
Senator McSally. Okay.
Ms. Flanagan. And so, generally, if a county receives SRS
and then in the next year if the county does not receive SRS--
--
Senator McSally. Yes.
Ms. Flanagan. ----they would have lower prior year
payments.
Senator McSally. Yes.
Ms. Flanagan. And under the existing statute.
Senator McSally. Okay.
Ms. Flanagan. And so, if that's the case because they would
have a lower prior year payment, generally then, the PILT would
increase because there would be fewer dollars of prior year
payments----
Senator McSally. Okay.
Ms. Flanagan. ----that would be deducted. And so, PILT
would increase.
Of course, I'm happy to look at any of the specifics of any
local, you know----
Senator McSally. Got it. But it may not equal PILT plus SRS
for a certain county from last year if SRS went away, right?
Ms. Flanagan. Correct.
Senator McSally. Is that fair to say? So PILT will go up,
just based on no other variables like population decrease, but
it may not equate to what they were getting in total from PILT
plus SRS, is that fair?
Ms. Flanagan. Right, each individual county calculation
would be different.
Senator McSally. Okay. But I would love----
Ms. Flanagan. And for every year that would be different.
Senator McSally. ----to follow up more with you on this
because it is important that they have understanding of
implications and we do too, obviously, as we are making
decisions.
Ms. Flanagan. Certainly. We would be happy to talk to any
of them.
Senator McSally. Great, thank you.
Mr. Rowley, as mentioned, SRS was supposed to be a band-
aid, right? It was supposed to make up for the timber industry
which was decimated by bad, overreaching policies, in my view,
and we are now reaping the consequences of that with the
mismanagement of our forests and the fire hazards and the
impact on water and the environment and all other things that
were supposed to be the intentions of some of that overreaching
but was really flawed in its execution.
So, even though it was, you know, it was a band-aid, my
concern would be if we get back to, with other initiatives like
4FRI and other things to better manage our forest where we can
actually have a thriving timber industry again, we have to live
in the world we are in. My concern would be that there might be
lower payments if we were to shift back over to not needing SRS
anymore because there is a timber industry, communities could
actually be impacted. Can you just talk a little bit more
about, as we bring industry back in and things like the 4FRI,
or other initiatives you may have in mind you want to talk
about, how that would be impactful? Or do you think, just, SRS
is here to stay, no matter what?
Mr. Rowley. Well, whether SRS is here to stay is probably
your call.
Senator McSally. Yes.
Mr. Rowley. Not mine.
I would describe it this way. Think of the Coconino
National Forest that has a history. The Coconino National
Forest had its own scalers stick, or scale stick, named after
it in the heyday of logging. I have a hard time imagining that
we would return to that level under the current societal
structure. So I don't know if returning, it seems unlikely to
me, I'm not a very good futurist, but I would say it seems
unlikely we would return to those kind of harvest levels and
those kind of timber receipts or the value of that raw material
that led to the heyday of having your own scale stick on the
Coconino National Forest.
Senator McSally. Okay, great. Thank you.
The Chairman. Thank you, Senator.
Senator Manchin.
Senator Manchin. This will be for Mr. Dilley, if you will.
I will go through this.
I have always taken my role--as you know, when I was
Governor as far as financial matters--very seriously for our
State of West Virginia and the taxpayers. Recently allegations
reported some pretty serious abuses by county commissioners
spending Secure Rural Schools funding in other parts of the
country. I know Senator Wyden has introduced a bill to require
the Forest Service and Bureau of Land Management to conduct
more rigorous oversight of counties' use of funds.
Mr. Dilley, I know that you take your role of ensuring
proper use of these funds very seriously as well. Can you
describe how Pocahontas County uses the funds it receives
through the Secure Rural Schools program?
Mr. Dilley. Absolutely.
Pocahontas County, of course, the way West Virginia works
is we receive our SRS after the state gets it, we receive it.
Many places use their PILT money differently than the SRS
funds. Of course, we need these SRS funds. We put them toward
things like maintenance to our aging buildings, transportation
costs, personnel that the state may not be able to fund so we
have to find ways to fund these personnel, different programs
for students, after-school activities, anything that they may
need help with--different salaries that are for personnel that
are not covered by the state but we have to have, special
education requirements. All these things are what our SRS money
is put toward.
The SRS still, I think, needs to be separated from PILT or
at least not combined into one. I understand that generally
these funds, you know, PILT could, potentially increase, but a
lot of these SRS funds, these schools need them and depend on
them. Our children are our future and if you're going to
reestablish and grow a rural community, you need to invest in
your school systems and that's what all the uses of SRS have
been going to.
Senator Manchin. Okay.
Mr. Rowley, Ms. Flanagan and Mr. Prysunka, as we work on
Senator Wyden's Forest Management for Rural Stability Act, we
have a unique opportunity to improve the Secure Rural Schools
program. The question is for all of you, really, but the three
I just mentioned. What other aspects of the Secure Rural
Schools program would you recommend improving? What can we do
to improve it? I know you have talked in general about
different things, but precisely, if you had one thing that
could make a difference in how, what was the one thing you
would do?
Mr. Rowley. Thank you, sir.
The one thing we would do is streamline the administrative
processes, specifically around Resource Advisory Committees and
how to staff them. I have a second.
Senator Manchin. Go ahead.
Mr. Rowley. My second one would be the counties are locked
in to how they receive their Title I and Title III payments.
And I think it would be great to give counties flexibility to
make those changes rather than lock in as their business needs
change over time.
Senator Manchin. Gotcha.
Mr. Prysunka. Stability and predictability would be crucial
for us in Wrangell so that we know when it's coming and we have
an idea of how much we're going to receive so that we can do
future planning as we move forward from school year to school
year.
Senator Manchin. Mr. Dilley, you feel the same?
Mr. Dilley. Yes, our one improvement would be the stability
and knowing ahead of time what funds may be coming your way,
that way we can aid in planning and personnel and have an idea
of what our future or the next year is going to look like.
Senator Manchin. Let me ask you this. Knowing that you are
going to go down to $73,000 next year if we don't do something,
from $750,000 in funding--Pocahontas County, as rural and small
as it is in population--how would you offer education?
Mr. Dilley. We've already, due to the unknown, if this is
going to continue or not, have lost five positions in our
county that we have not hired back in our school system.
Senator Manchin. At what detriment to the kids? What
positions?
Mr. Dilley. These are, of course, the ones like arts, the
arts programs have lost some, some special education has taken
a hit as well and even just our maintenance staff. We're down
to the bare minimum of what we have in maintenance and
personnel. We can't afford to lose anybody else.
Senator Manchin. Ms. Flanagan, you heard the streamline, do
you agree what needs to be done?
Ms. Flanagan. Yes, I'll defer to the Forest Service who
runs the program on SRS.
Senator Manchin. Well, thank you. I mean, I think everybody
here is affected by this and we are all going to do the right
thing and try to make sure that you are able to operate but
also have some dependability. So your input is vital to us
today, really vital to us and it is timely. So, thank you,
again.
The Chairman. Thank you, Senator Manchin.
Senator King.
Senator King. First I want to thank you, Madam Chair, for
inviting me to the Western States' Caucus this morning and as--
--
The Chairman. Delighted, you are an honorary member, you
know that.
Senator King. Thank you, thank you.
Well, I have an interesting perspective because Maine is
absolutely the opposite of what we are talking about here
today. Maine is the most forested state in America and over 95
percent of our forests are privately owned. So it is a
completely different ecosystem in terms of the ownership
patterns. What I am interested in, and I have heard Senator
Risch mention this and it may be our Committee or the
Agriculture Committee or some joint committee, but I am
interested in data. I would like to see comparative data
between privately-owned forest land and publicly-owned,
particularly, federal forest land in terms of productivity
growth, harvesting, because my instinct is that there is a
great disparity and that a lot of the problems we are talking
about of funding for these various programs would be
significantly alleviated if more revenues came from harvesting
on public land which, by the way, is better from an
environmental point of view because growing trees absorb more
carbon than mature trees and so the sustainable harvesting of
forest land is actually a net plus in terms of carbon
sequestration.
I do not have any questions for these witnesses, but I
would suggest, Madam Chair--and the data may exist, I am not
aware of it--that there be some collection of data from the
U.S. Forest Service, and compare it, benchmarking, if you will.
I know that there are grave differences in climate and species
and those kinds of things, but to the extent we can get apples
to apples comparison, I think it would be good guidance for us
in terms of setting future forest practices policies in the
Western states in order to alleviate this funding problem.
I am very proud of forest practices in Maine. As I say, we
are the most forested state in the country. We are growing more
wood than we are harvesting by a significant margin, yet we do
harvest for the forest products industry and other uses on a
continuing, sustainable basis and a very large percentage of
our forest is certified sustainable by the various
certification agencies.
I just commend that to the Chairman's consideration. I
think data would really help us in telling us what direction we
should be going in and are there, potentially, additional
revenues to be had and jobs to be had from harvesting in the
national forests as opposed to in the private forest. So that
is my comment.
The Chairman. Well, I thank you for that, Senator King, and
I am certain that we have access to that data. I know that
anecdotally we say there is more timber that is harvested in
New York on their private lands than we have seen harvested
ever in all the decades of harvest on the Tongass National
Forest, the largest national forest in the country, so that
would be interesting to know exactly and see if we can't get
some current----
Senator King. I don't want to be here to suggest any
cutting of environmental corners or relaxation of standards.
The Chairman. No, no, no. I think it is a good data point
that you are asking for.
Senator King. I just think it would be interesting to know
and compare it and also compare environmental outputs and
assumptions between the two patterns of forest practice, if you
will.
The Chairman. You know, I appreciate that and that is
something that I would be curious about as well.
Let's go to Senator Hoeven and then to Senator Cantwell.
Senator Hoeven. Thank you, Madam Chairman.
Director Flanagan, can you discuss how the administration
of PILT funds to counties helps ensure local governments have
the flexibility necessary to meet their specific needs which is
one of the great strengths of PILT, right?
Ms. Flanagan. Yes, absolutely. PILT funds can be used for
any governmental purpose. And so, typically PILT funds are used
for critical functions such as firefighting and police
protection, construction of public schools and roads, and
search and rescue operations.
Senator Hoeven. Talk a little bit about the importance of
infrastructure, pipelines, transmission lines, all those
things, because as we produce more energy that generates PILT
revenue which, I think, benefits everybody but in order to do
that, we have to not only produce it, we have to sell it,
right?
Talk about the importance of getting access to
infrastructure out in rural America so that we can produce more
energy and its impact relative to PILT.
Ms. Flanagan. Well, generally I would say I'm here to talk
about the PILT program, but generally, coming from a rural
state, of course, infrastructure across the state is critical
for economic development as well as for the citizens of the
state.
Senator Hoeven. Right, but we can't get, we are not going
to grow and expand those Payments in Lieu of Taxes if we don't,
from the energy piece, if we don't have the infrastructure,
right? So obviously, it is important we do it right and well
but we have to develop that infrastructure, don't we, in order
to continue to expand the pie and have more of those revenues
that, like we talked about, benefit everybody? So that is the
key, is how important that is. Go ahead and expand on that. Do
you agree with that?
Ms. Flanagan. Alright, so generally, in the PILT Act there
were federal payments that are named in the PILT Act that are
used as deductions in the PILT program and those would be
things like Secure Rural Schools, the Mineral Leasing Act, the
National Forest Fund as well as Taylor Grazing.
Senator Hoeven. Okay, alright.
Deputy Chief Rowley, Secure Rural Schools, how well is the
program currently meeting the demands of the counties?
Mr. Rowley. I think that's a better question to ask my
friends with local government and what we're hearing, people
appreciate the stability when it operates and people appreciate
the RAC, the Resource Advisory Committee, and that local
engagement in influencing and setting priorities for management
investments on National Forest System lands. So we receive high
marks.
Senator Hoeven. Well, that is good.
What would you suggest as reforms or improvements? What are
the things you could do to be even more effective?
Mr. Rowley. So, two things I've talked about. I'm happy to
explore other ideas with all of you. Two under, maybe it's
driving with the rear-view mirror, but nonetheless, it's what
we see now. Streamlining the identification and selection of
members to fill positions on the Resource Advisory Committee,
and secondly, allowing counties to flex their selection between
Title I and Title III funds. Right now, it's locked in and has
been for a while. Needs for the counties change. Title I, then
III had different constraints on it. It'd be great to give
counties flexibility on that. That feels like a good place for
us to start.
Senator Hoeven. Same question for our other two witnesses
and the Honorable--I would pronounce your last name, but I
would probably muff it.
Mr. Prysunka. That's okay. We'll give you a by on my last
name, it's Prysunka.
Senator Hoeven. Tell me what it is.
Mr. Prysunka. It's a tough one. It's phonetic. Prysunka.
Senator Hoeven. One more time.
Mr. Prysunka. Prysunka.
Senator Hoeven. Prysunka.
Mr. Prysunka. Yeah.
Senator Hoeven. Okay, that is good.
Mr. Prysunka. Okay.
Senator Hoeven. I have it now.
Mr. Prysunka. Good.
I think flexibility with the Title II RAC funds would be
most appreciated because we are in a constant state of flux
with the, where we need to place funds. But one of the things
that we're experiencing in rural Alaska is our aging
infrastructure and, for example, between Ketchikan, Wrangell
and Petersburg, we've been stalled as per recommended years ago
on our pipes which has responded negatively to our acidic soil
and we've got electrolysis taking place and massive breaches in
our water system--and we have a water main break probably every
two weeks right now.
Senator Hoeven. Wow.
Mr. Prysunka. And, of course, combined with the drought in
the state and an aging reservoir, it was very difficult for us
to even meet local domestic needs.
So those are the sort of things that we have to start
looking at and finding funds for and with, particularly in
Alaska, state funds have dried up and there's been a lot of,
sort of, downstream cuts and those cuts come to the
municipality. And with limited ability to raise funds locally,
we've had to find other ways to do it. So some flexibility when
we have emergencies and specific issues that we'd like to, kind
of, divert some funds toward projects would be really
appreciated.
Senator Hoeven. Understand. Thank you very much.
Thank you, Madam Chair.
The Chairman. Thank you.
Senator Cantwell.
Senator Cantwell. Thank you, Madam Chair, thank you. I know
we have a vote underway, and we are in the middle of it, but
thank you to you and Ranking Member Manchin for holding this
important hearing. I know many of my colleagues have been here
and have spoken and, to me, this is very important and I almost
feel like we are so in the weeds in detail here that we just
need to come up for air and just say to people that when we
have a federal footprint in a state there is no revenue. We
need to do something because we believe that these counties,
these rural counties, are critical to our states and the
management of those federal lands.
So if you want to have management of federal lands, then
you have to have people that live there, you have to have
hospitals, you have to have schools, you have to have roads
that are paved, you have to have law enforcement. I can't wait
to see what Senator King is asking for, because he will see
that you get a lot of revenue from those private timber lands
and for the federal land you don't get the revenue.
In my state we basically receive $23 million in PILT
payments, $16 million in SRS payments, and these counties are
home to iconic national parks, iconic national forests, federal
lands. For example, Skamania in Southwest Washington is 85
percent federal land and almost the rest of the county is owned
by the state or a couple of timber mills. So only two percent
of Skamania County can be developed or is taxable, two percent
of the county. Yet I guarantee you can go to the Skamania
Lodge. It is the most beautiful place. I meet people all the
time in Washington, DC, that say, oh, I went and had a
conference at Skamania Lodge and you see the grandeur of the
Colombia River Gorge and many great attributes and some
wonderful communities and towns.
But SRS makes up 15 percent of the county's budget and
these funds have to be used for emergencies to respond to
things on the national forest, to support our federal employees
and families. At one point we had a train accident right below
Skamania on the Amtrak line. I am pretty sure people in
Skamania County helped to respond to that. I am sorry, I don't
think it was Amtrak, but these issues are of great importance
and to me, I am most struck, I don't think this is a band-aid.
I think it is an obligation by the Federal Government, and it
should be met and we should not, every couple years, go ``oh,
well, we have to come up with a great idea to how to make this
funding work.'' No. We should say we have a federal footprint.
They do not have tax revenue. We want the communities to exist.
How do we give them predictable funding?
Mr. Prysunka, what do you think that looks like from, you
know, what is that, a five-year determination? What is
predictable funding for a community that has to meet these
obligations to help us manage our federal resources, and yet
the uncertainty that we jam on them by not authorizing these
programs or giving certainty? What would be most helpful?
Mr. Prysunka. Well, I think you summed it up really nicely.
It is an obligation, and we do not have the ability to generate
funds. And so, the further out the better for us. It's very
difficult to do municipal planning on a year-to-year basis,
basically. And it's very difficult for us to plan for our
school system and our growth, you know, with the SRS funds, but
just our growth for our community.
So the further out the better. And I think I really like
what you had to say about it being an obligation to these
communities because we don't know what--right now we know that
timber, particularly in our region, is slowed down and we've
seen our mill has gone away. It's been recycled over to China
and we have a parking lot now where we once had two vibrant
mills doing two shifts each day, 500 workers between the mills.
They're gone. And rebuilding that capacity, I don't know if
that will ever happen again.
But we don't know what opportunities lie still within the
forest that you're going to want to have a community there in
order to be the base for that. And if even, let's look at
federal employees, you know, we have hospitals and roads that
those federal employees they're living in our community and
working for the Forest Service. So, the further out the better.
But I'll tell you, if we could get two plus years, that would
be a big start for us. At least we'd have an opportunity to be
able to start budgeting out to the future.
Senator Cantwell. Yes, two years, alright, I agree. We
should be able to give that predictability, two years. I think
some people misunderstand, particularly in my state. I am
telling you, when we had this Land and Water Conservation Fund
debate and whether we were going to fund it, the number one
community that came at us were hunters from Skamania County who
are like, I want you to protect this land because this is where
our elk hunting happens. This is where all of this is
happening. Please, help us.
These communities are more vibrant and so, I just want us
to own up to the responsibility and not constantly say, well,
we can't come up with the funding source. The rest of the
United States needs to understand. The federal footprint means
a federal obligation, and we should give you predictability.
Thank you, Madam Chair.
The Chairman. Senator Cantwell, thank you.
As she has reminded us, we are 20 minutes into our 10-
minute vote. So we are going to have to end the hearing, but I
want to thank each of you for what you have contributed here
today. I think the discussion has been good. I think you have
heard very clearly from those in the Western states, the
imperative of SRS, of PILT and those in the East, whether it is
West Virginia or Maine, also get it and I think we have been
challenged.
It is a fair question to ask about what we really want from
our public lands going forward. That is a fair question from
Senator Heinrich. But I think for those of us that come from
these states that are heavily, heavily in the hands of the
Federal Government, your ability when we say Wrangell, go out
and diversify your economy, it is easier said than done. It is
not just about getting the harvest up, it is other things that
put in delays.
Senator Daines talked about the Cottonwood fix and how
imperative that is. In New Mexico there was a federal judge who
just suspended all, all tree cutting activities in New Mexico
over a lawsuit involving the Mexican Spotted Owl. What I
understand is it is not just the tree harvesting, it is
everything from collecting firewood. We had to get a special
permit to have the tree, the Christmas tree that New Mexico is
hosting this year for the nation's Capitol here. They had to
get a special permit in order to harvest that tree, but that
was a special exemption from the court to do just that. So you
know, you think about what is going on from the perspective of
policy initiatives, whether in Alaska it is the roadless or
whether it is what litigation does or whether it is just we
have moved into other areas of economic activity.
But these are issues that are very, very real to these
communities and whether it is my little hometown of Wrangell or
what goes on in West Virginia, or anywhere across the country,
this is a responsibility that we have. We have to be working
with you and for you.
Thank you for the time that you have given to us. Mr.
Rowley, I know that we are going to follow up with you on some
of the suggestions that you have made specific to the RACs. So
we have some work to do together, and we look forward to doing
that.
With that, the Committee stands adjourned.
[Whereupon, at 11:50 a.m. the hearing was adjourned.]
APPENDIX MATERIAL SUBMITTED
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