PILT – Payments in Leiu of Taxes – a factor in the reauthorized LWCF ?

Discussion in DC in March and subsequent deliberations on the Hill have made it clear that the massive PILT program ( 425 + million a year ) will be a factor in the negotiations to pass a reauthorized LWCF.  See the following articles..

County payments eat hole in Interior-EPA bill, possibly sapping key programs – Tuesday, July 15, 2014

A proposal by House appropriators to carve out $442 million of the Interior Department and U.S. EPA budgets to pay for rural county services has raised concerns among lawmakers of both parties that it could sap money from other important agency functions, including land conservation, wildfire prevention and clean water. And if Congress this year decides to fund county services as part of the regular appropriations process — something it has not done since 2007 — it could also hamper efforts among conservationists, county advocates and Western lawmakers to find a long-term solution both for county payments and federal land conservation.

The House Appropriations Committee this morning will vote on a $30.2 billion bill to fund Interior, EPA, the Forest Service and other programs for fiscal 2015. In a break from recent years, the bill includes $442 million for payments in lieu of taxes, or PILT, a program that compensates counties with large tracts of non-taxable federal lands, mostly in the West. Since 2008, the program has been funded outside of the discretionary budget — with mandatory funding that did not need approval from appropriators each year.

Since 1977, the Interior Department has disbursed more than $6 billion in PILT payments to nearly 2,000 counties. While the program was funded for fiscal 2014 as part of this year’s farm bill, final payments were disbursed this summer, leaving counties in a fiscal pinch. The National Association of Counties praised appropriators’ inclusion of PILT in the Interior-EPA fiscal 2015 spending bill as “good news,” warning that without it, counties risk “huge budget shortfalls impacting public safety, education, infrastructure and other local government responsibilities.” But while Western appropriators also touted its inclusion to their constituents, members of both parties warned that PILT would drain other agency programs.

Including PILT in the discretionary budget also relieves some pressure on lawmakers to forge a long-term funding solution for it. Members of both parties in each chamber are exploring ways to package mandatory funding for PILT and the Land and Water Conservation Fund, a program that funds federal land acquisitions and is a top priority for conservationists, sportsmen and the Obama administration.  Rep. Jim Moran (D-Va.) said last week that paying for PILT out of the discretionary budget is “a mistake.”

“If state and local governments believe PILT is an entitlement, it should be funded from mandatory spending, as was the case for the past six years,” Moran said at a subcommittee markup of the spending bill. “It crowds out funding for other high-priority needs.” While the $30.2 billion overall bill represents a slight uptick above current spending levels for the natural resource agencies, much of that increase is subsumed by the addition of PILT, as well as significant increases in wildland fire.

For example, the panel is also proposing providing $470 million to cover a projected shortfall in what Congress provided in the last appropriations cycle for wildfire suppression.“Everyone on this subcommittee would agree that we’d like to see PILT as mandatory funding,” said Rep. Mike Simpson (R-Idaho), the former chairman of the Interior, Environment and Related Agencies Appropriations Subcommittee, who is a key supporter of crafting a long-term, mandatory funding bill for PILT, Secure Rural Schools — which is similar to PILT — and LWCF.

Other lawmakers, including Rep. Rob Bishop (R-Utah), a key LWCF critic, have said they’re open to exploring such a package. “We’ve been trying to marry up PILT and LWCF, because I think that ought to be on the mandatory side, too,” Simpson said. Simpson said he has put the National Association of Counties (NACo) in contact with conservation groups to see if a deal can be hammered out, although the main impediment is finding a way to pay for it, he said. An email to NACo was not returned yesterday.

For conservationists hoping to advance discussions around a PILT-LWCF permanent funding deal — one that would get LWCF off the discretionary funding roller coaster — inclusion of PILT in the House spending bill could be seen as a setback. As long as rural, fiscally conservative lawmakers are satisfied that appropriators have taken care of county payments, they have less incentive to compromise on LWCF spending. For now, the House bill would provide $152 million for LWCF, which, while a major increase over last year’s draft House proposal to zero it out, is still half what the program is funded at currently.

Conservationists and counties both have a lot to gain from achieving mandatory funding for LWCF and PILT. For counties, it would mean less uncertainty over future budgeting for PILT-funded services, including education, solid waste disposal, law enforcement, search and rescue, health care and environmental compliance. It would also spare conservationists from constantly battling House proposals to gut LWCF. It remains unclear whether Senate appropriators will elect to fund PILT within the discretionary budget, though it’s certain that Interior, Environment and Related Agencies Appropriations Subcommittee Chairman Jack Reed (D-R.I.) will feel pressure to do so from his rural Western colleagues.  Alan Rowsome, senior director of government relations for lands at the Wilderness Society, said the need for a permanent funding solution for both programs will remain regardless. “There will still be a nexus that PILT and LWCF have together,” Rowsome said. “The permanence and the need to be able to plan better locally will still be there.”

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Utah’s Bishop says LWCF must be ‘bigger’ than land acquisition

The Land and Water Conservation Fund should be revamped to help pay for “bigger needs,” including local recreation, infrastructure and education, according to Rep. Rob Bishop. For example, Congress should explore using LWCF dollars for payments in lieu of taxes (PILT), an expired program that pays rural counties for the federal lands they are unable to tax, the Utah Republican said.  LWCF money could also support the education of future energy workers whose production of domestic oil and gas could help raise more conservation dollars, Bishop said. Or it could better aid state and local governments in promoting recreation, he said.

Bishop, the chairman of the Natural Resources Subcommittee on Public Lands and Environmental Regulation and a vocal critic of LWCF, yesterday offered a critique of the nearly 50-year-old program as it nears its expiration in 2015.  “There are state and local recreation, infrastructure and education needs that could be solved if we had a comprehensive plan to use this fund to help local governments,” Bishop wrote in an op-ed. “The workforce producing these funds is aging and these high-paying jobs are being filled by foreign workers, not our kids. A portion of these funds should be re-invested in the education of future American energy industry workers.”Those are just a few ways Bishop feels money from LWCF could be utilized beyond land acquisition, said spokeswoman Melissa Subbotin.  Bishop’s short op-ed “lays out the basic foundation upon which he plans to build a bigger policy initiative that will include several areas where LWCF ought to be used,” she said.Bishop will be articulating some of those proposals when he meets with Interior Secretary Sally Jewell on Tuesday, she said. Bishop called the Obama administration’s vision for LWCF “just too small” and said there is more that could be done with the fund’s $900 million in authorized funding.

The fund, which began in 1965, is used to acquire new federal lands, conserve private lands, bolster urban parks and trails and aid in species recovery. While it is authorized at $900 million — paid for by revenues from offshore oil and gas drilling — it is currently funded at just over $300 million, a point that frustrates backers including the administration, Democrats, conservationists and sportsmen.  Jewell this month has called for full funding and reauthorization of LWCF during trips to Birmingham, Ala., and Richmond, Va., and has begun making visits on Capitol Hill with similar intent. Bishop said the administration “must remove the blinders and grow the fund; not just spend it faster.” He said he wants states to have more control over the use of LWCF dollars.  The lawmaker said he has discussed his ideas for LWCF’s future with House leadership, appropriators and some members of the Natural Resources Committee.

Some Republican lawmakers, including Bishop, oppose the acquisition of new federal lands until the federal land management agencies — specifically the National Park Service, Bureau of Land Management, Fish and Wildlife Service and Forest Service — find ways to rein in growing maintenance backlogs for roads, trails and facilities. Members on both sides of the aisle have contemplated using some LWCF funds for that purpose. But authorizing new uses of LWCF money is likely to run into criticism from some conservationists who feel land and wildlife protection should remain its sole focus.

LWCF supporters have ramped up their public relations efforts in recent months. In a packed Senate hearing room this week, four lawmakers — Sens. Susan Collins (R-Maine) and Martin Heinrich (D-N.M.) and Reps. Dave Reichert (R-Wash.) and Peter DeFazio (D-Ore.) — pointed to parks and public lands in their states as proof that LWCF is successful. The LWCF Coalition this week also released a report asking Congress to move the LWCF budget into mandatory funding, ensuring that it would be funded at $900 million every year and would be free from the cuts in the annual discretionary budget.