[House Report 107-688]
[From the U.S. Government Publishing Office]
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-688
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PILT AND REFUGE REVENUE SHARING PERMANENT FUNDING ACT
_______
September 25, 2002.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
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Mr. Hansen, from the Committee on Resources, submitted the following
R E P O R T
[To accompany H.R. 1811]
[Including cost estimate of the Congressional Budget Office]
The Committee on Resources, to whom was referred the bill
(H.R. 1811) to provide permanent funding for the payment in
lieu of taxes program, and for other purposes, having
considered the same, report favorably thereon without amendment
and recommend that the bill do pass.
Purpose of the Bill
The purpose of H.R. 1811 is to provide permanent funding
for the payment in lieu of taxes program, and for other
purposes.
Background and Need for Legislation
PAYMENTS IN LIEU OF TAXES (PILT)
Congress enacted PILT (Public Law 94-565; 31 U.S.C. 6901-
6907) in 1976 as a mechanism for the federal government to make
payments to local governments to offset losses in property
taxes resulting from the presence of nontaxable federal lands
within a locality's boundaries. PILT, which is administered by
the Bureau of Land Management (BLM), provides a funding stream
to local governments (typically counties) which provide a range
of public services on federal lands, including public safety,
transportation and social services. Payments are generally made
directly to the counties and can be used for any governmental
purpose.
Lands qualifying for federal reimbursement (entitlement
lands) under PILT include federal lands administered by the
U.S. Forest Service, the National Park Service, BLM, dredge
areas maintained by the Army Corps of Engineers, inactive and
semi-active Army installations, U.S. Fish and Wildlife Service
lands reserved from the public domain, and some lands donated
to the federal government. Funds are allocated based on a
complex statutory formula that takes into consideration such
variables as the number of entitlement acres, the population of
the eligible county, and the amount of money a county received
during the previous year under non-PILT reimbursement programs
like the Refuge Revenue Sharing Act, the Secure Rural Schools
and Community Self-Determination Act, the National Forest Fund,
the Mineral Leasing Act and others. A county's net-receipts
under these non-PILT programs are subtracted from what a county
would otherwise receive under PILT in the following year.
The other primary determinant of a county's reimbursement
under PILT is Congressional appropriations. While PILT's
formula sets the authorization bar, Congressional
appropriations have rarely equaled the formula's authorized
levels. In Fiscal Year (FY) 2002, for example, Congress
appropriated $210 million to PILT, but full payments to
counties under the formula would have totaled approximately
$351 million. In this case, as in most prior years, the amounts
prescribed under the formula were reduced across-the-board on a
pro rata basis, meaning all counties saw their allocation
reduced by an identical amount. In FY 2002, this meant that
counties received only 59.7% of the amount authorized by the
PILT program.
Refuge Revenue Sharing Act
The Refuge Revenue Sharing Act (RRSA, 16 U.S.C. 715s) was
enacted in 1935 to authorize payments to be made to localities
to offset tax losses to counties where the U.S. Fish and
Wildlife Service (FWS) owns and manages nontaxable land. Like
PILT, RRSA is funded according to a complicated formula through
receipts from various FWS fees, including grazing, mineral
development, sale of forest products, and other activities. To
the extent that these fees do not cover outlays prescribed by
the funding formulas, the RRSA authorizes the use of
appropriations from the general fund to meet shortfalls. If fee
and appropriated moneys still do not meet the formula's
authorized levels, as has often been the case, then payments
are reduced across-the-board on a pro rata basis, in a manner
similar to PILT.
Like PILT, RRSA appropriations have historically fallen
well short of authorized levels. In FY 2002, Congress
appropriated $17.3 million for RRSA, just 52% of the authorized
level, at $33.5 million.
Shortfalls in appropriated dollars to both PILT and RRSA
over the years have had a debilitating impact on the scores of
county governments, which rely heavily on these programs to
fund local operations. These funding inadequacies adversely
affect schools, roads, social services, and local police and
fire departments. While the problem is most acute in western
communities, where the federal government controls vast swaths
of tax immune land, the pangs of inadequate funding have been
felt in communities all across the nation.
H.R. 1811 would solve this problem once and for all, by
fully funding PILT and RRSA without further appropriation
beginning in 2002.
Committee Action
H.R. 1811 was introduced on May 10, 2001, by Congressman
Scott McInnis (R-CO). It was referred to the Committee on
Resources and within the Committee to the Subcommittees on
Forests and Forest Health, National Parks, Recreation and
Public Lands and Fisheries
Conservation, Wildlife and Oceans. The Subcommittees held a
legislative hearing on the bill on July 25, 2002. On September
12, 2002, the Full Resources Committee met to consider the
bill.
The Subcommittees were discharged from further
consideration by unanimous consent. No amendments were offered
and the bill was ordered reported to the House of
Representatives by unanimous consent.
Committee Oversight Findings and Recommendations
Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII of the Rules of the House of Representatives, the
Committee on Resources' oversight findings and recommendations
are reflected in the body of this report.
Constitutional Authority Statement
Article I, section 8 of the Constitution of the United
States grants Congress the authority to enact this bill.
Compliance With House Rule XIII
1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the
Rules of the House of Representatives requires an estimate and
a comparison by the Committee of the costs which would be
incurred in carrying out this bill. However, clause 3(d)(3)(B)
of that rule provides that this requirement does not apply when
the Committee has included in its report a timely submitted
cost estimate of the bill prepared by the Director of the
Congressional Budget Office under section 402 of the
Congressional Budget Act of 1974.
2. Congressional Budget Act. As required by clause 3(c)(2)
of rule XIII of the Rules of the House of Representatives and
section 308(a) of the Congressional Budget Act of 1974, this
bill does not contain any new budget authority, credit
authority, or an increase or decrease in revenues or tax
expenditures. According to the Congressional Budget Office,
enactment of this bill will result in new direct spending.
3. General Performance Goals and Objectives. As required by
clause 3(c)(4) of rule XIII, the general performance goal or
objective of this bill is to provide permanent funding for the
payment in lieu of taxes program.
4. Congressional Budget Office Cost Estimate. Under clause
3(c)(3) of rule XIII of the Rules of the House of
Representatives and section 403 of the Congressional Budget Act
of 1974, the Committee has received the following cost estimate
for this bill from the Director of the Congressional Budget
Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, September 19, 2002.
Hon. James V. Hansen,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1811, the PILT and
Refuge Revenue Sharing Permanent Funding Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts for this
estimate are Megan Carroll and Deborah Reis.
Sincerely,
Barry B. Anderson
(For Dan L. Crippen, Director).
Enclosure.
H.R. 1811--PILT and Refuge Revenue Sharing Permanent Funding Act
Summary: H.R. 1811 would provide new direct spending
authority for the Secretary of the Interior to make payments to
states and counties under the payment in lieu of taxes (PILT)
program and the refuge revenue sharing program. CBO estimates
that enacting H.R. 1811 would increase direct spending by $157
million in 2002 and by $3.9 billion over the 2002-2012 period.
Because the bill would affect direct spending, pay-as-you-go
procedures would apply.
By making PILT and refuge revenue sharing payments fully
available without appropriation action, H.R. 1811 could create
savings in discretionary spending. Assuming that annual
appropriations are reduced accordingly, CBO estimates potential
discretionary savings of $228 million in fiscal year 2003 and
about $1.4 billion over the 2003-2007 period.
H.R. 1811 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments. Enacting this legislation probably would benefit
local governments that receive payments under these two
programs.
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 1811 is shown in the following table.
The costs of this legislation fall within budget function 800
(general government).
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By fiscal year, in millions of dollars--
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2002 2003 2004 2005 2006 2007
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DIRECT SPENDING
Mandatory spending under current law for PILT and refuge
revenue sharing: \1\
Estimated budget authority............................ 7 7 8 8 8 8
Estimated outlays..................................... 7 7 8 8 8 8
Proposed changes:
Estimated budget authority............................ 157 273 278 286 296 305
Estimated outlays..................................... 157 273 278 286 296 305
Mandatory spending under H.R. 1811 for PILT and refuge
revenues sharing:
Estimated budget authority \1\........................ 164 280 286 294 304 313
Estimated outlays..................................... 164 280 286 294 304 313
CHANGES IN SPENDING SUBJECT TO APPROPRIATION \2\
Estimated authorization level............................. 0 -228 -233 -238 -242 -248
Estimated outlays......................................... 0 -228 -233 -238 -242 -248
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\1\ These figures represent the estimated mandatory portion of annual funding for refuge revenue sharing
payments under current law.
\2\ The changes in spending subject to appropriation represent savings that could occur under H.R. 1811
beginning in 2003, when all PILT and refuge revenue sharing payments would become mandatory spending. A total
of $224 million was approved for these payments in 2002, including $210 million for PILT and $14 million for
refuge revenue sharing.
Basis of estimate
CBO estimates that enacting H.R. 1811 would increase direct
spending for PILT and refuge revenue sharing payments by $157
million in 2002, $273 million in 2003, and about $3.7 billion
over the 2003-2012 period. Enacting this legislation would
reduce the need for future appropriations for these programs,
but any resulting savings would depend on future appropriation
actions. In 2002, funds provided in appropriations acts for
these payments totaled nearly $230 million. The total estimated
cost to fully fund the PILT and refuge revenue sharing program
in 2002 in $391 million.
This estimate is based on information provided by the
Department of the Interior and on CBO baseline assumptions
regarding future payments to local governments under certain
other payment programs as well as continuing land acquisitions
and increases in the fair market value of public lands. For
this estimate, CBO assumes that H.R. 1811 will be enacted
before the end of fiscal year 2002, and that payments would be
made in this fiscal year. If the legislation were enacted in
fiscal year 2003, we expect that amounts authorized for 200
PILT payments would be made in 2003.
Permanent funding for PILT
PILT is a payment program that compensates local
governments for losses in their tax bases due to the presence
of certain federal lands within their jurisdictions, which are
exempt from state and local taxation. The Bureau of Land
Management (BLM) calculates the PILT payment authorized for
each local jurisdiction based on population, the number of
federal acres present, and other federal payments received by
the jurisdiction. H.R. 1811 would provide permanent funding for
PILT payments, which under current law are subject to
appropriation. According to BLM, the full authorization level
for PILT payments in fiscal year 2002 is $351 million, and the
agency already has received appropriations totaling $210
million for those payments. Hence, CBO estimates that fully
funding the program this year would create direct spending of
$141 million. We also estimate that H.R. 1811 would create PILT
direct spending of $241 million in 2003 and about $3.3 billion
over the 2003-2012 period.
Refuge revenue sharing payments
The Refuge Revenue Sharing Act authorizes the U.S. Fish and
Wildlife Service (USFWS) to make payments to counties where
national refuges and other USFWS-administered land is located.
Generally, the authorized level of such payments for each
county is equal to the greater of: (1) $0.75 per acre of USFWS
land located in the county, (2) 25 percent of net offsetting
receipts (if any) earned from commercial activities on such
land, or (3) three-fourths of 1 percent of the land's fair
market value. The annual payments are funded by a combination
of direct spending authority and discretionary appropriations.
In the last 20 years, those two sources have not been
sufficient to fully fund the entire authorized level of refuge
revenue sharing payments, and each county's payment has been
reduced proportionately. Beginning in fiscal year 2002, H.R.
1811 would make available without further appropriation the
entire amount necessary to fund all payments to counties at the
authorized level. CBO estimates that the bill would increase
direct spending by $16 million in 2002, by $32 million in 2003,
and by $442 million over the 2003-1012 period.
Pay-as-you-go considerations: The Balanced Budget and
Emergency Deficit Control Act sets up pay-as-you-go procedures
for legislation affecting direct spending or receipts. The net
changes in outlays that are subject to pay-as-you-go procedures
are shown in the following table. For the purposes of enforcing
pay-as-you-go procedures, only the effects through fiscal year
2006 are counted.
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By fiscal year, in millions of dollars--
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
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Changes in outlays.............................................. 157 273 278 286 296 305 315 465 478 492 507
Changes in receipts............................................. Not applicable
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Intergovernmental and private-sector impact: H.R. 1811
contains no intergovernmental or private-sector mandates as
define in UMRA and would impose no costs on state, local, or
tribal governments. Enacting this legislation probably would
benefit local governments that receive payments under these two
programs.
Previous CBO estimate: On June 20, 2002, CBO transmitted a
cost estimate for S. 454 as ordered reported by the Senate
Committee on Energy and Natural Resources on June 5, 2002. The
two bills are very similar, and our cost estimates are the
same.
Estimate prepared by: Federal costs: Megan Carroll and
Deborah Reis; Impact on State, local, and tribal governments:
Marjorie Miller; Impact on the private sector: Cecil McPherson.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
Compliance With Public Law 104-4
This bill contains no unfunded mandates.
Preemption of State, Local or Tribal Law
This bill is not intended to preempt any State, local or
tribal law.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SECTION 6906 OF TITLE 31, UNITED STATES CODE
[Sec. 6906. Authorization of appropriations
[Necessary amounts may be appropriated to the Secretary of
the Interior to carry out this chapter. Amounts are available
only as provided in appropriation laws.]
Sec. 6901. Authorization of appropriations
There is authorized to be appropriated such sums as may be
necessary to the Secretary of the Interior to carry out this
chapter. Beginning in fiscal year 2002 and each fiscal year
thereafter, amounts authorized under this chapter shall be made
available to the Secretary of the Interior, out of any other
funds in the Treasury not otherwise appropriated and without
further appropriation, for obligation or expenditure in
accordance with this chapter.
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SECTION 401 OF THE ACT OF JUNE 15, 1935
AN ACT To amend the Migratory Bird Hunting Stamp Act of March 16, 1934,
and certain other Acts relating to game and other wildlife,
administered by the Department of Agriculture, and for other purposes
Sec. 401. (a) * * *
* * * * * * *
(d) If the net receipts in the fund which are attributable to
revenue collections for any fiscal year do not equal the
aggregate amount of payments required to be made for such
fiscal year under subsection (c) to counties, there are
authorized to be appropriated to the fund an amount equal to
the difference between the total amount of net receipts and
such aggregate amount of payments. Beginning in fiscal year
2002 and each fiscal year thereafter, such amount shall be made
available to the Secretary, out of any other funds in the
Treasury not otherwise appropriated and without further
appropriation, for obligation or expenditure in accordance with
this section.
* * * * * * *