Congress recently passed a $1 trillion spending bill to keep the United States government in operation, but missing from that bill are the funds that many counties in Montana have come to rely on in their annual budgets.
The budget bill dropped $330 million in funding from Secure Rural Schools, a federal program run through the U.S. Forest Service providing funding for counties and schools.
Last year, Flathead County received just over $1.6 million in SRS funding; roughly $1,067,000 went toward the county’s road department, and the remaining funds went to the schools.
Should the SRS monies not find their way back into the government’s spending bill, it would be a big hit to the county’s bottom line, Flathead County administrator Mike Pence said.
“The road budget is a little less than $8 million,” Pence said. “(SRS funding) is one-eighth of our budget, so that’s a lot. But we still have seven-eighths to run with and we’ll just have to reduce our overall cost.”
There are other funding sources the county could tap to cover the cost, he said, such as the money the county set aside to help with Rural Special Improvement District (RSID) projects, which sits at over $2 million.
But that money would last about two years covering for SRS funds, Pence said.
“We’ve got a little bit of a cushion, but obviously once that money’s gone, we’re still not going to be getting a million dollars a year (from SRS funds),” he said.
The situation is direr in Lincoln County, says Commissioner Tony Berget. SRS money accounts for $3 million of the budget, he said, and losing that money would be an especially tough blow after the county had to strip $2.1 million from its budget last year after a mathematical error resulted in over-taxation.
Berget said SRS and Payment in Lieu of Taxes (PILT) funds have become integral to the county budget because the Forest Service isn’t logging the timber like it used to. Before SRS started in 2000, counties and schools received 25 percent of the revenues generated from timber sales in national forests within the county’s borders.
“One of two things has to happen,” Berget said. “Either they have to start logging again so we can get the 25 percent, or we’re just going belly up, we’re going under.”
The county received about $3 million for its last SRS payment, Berget said, and that money went to the road department.
Lincoln County is more than 76 percent federal lands, he said, and revenue from logging or mining has slowed significantly. While there have been signs that more logging projects are on the way, Berget said the county can’t count on that to make its budget.
“We’re hemorrhaging money and we’ve been making cuts, but we can’t cut to prosperity,” Berget said.
On Dec. 19, Montana U.S. Rep. and Senator-elect Steve Daines joined with a bipartisan group of House members in writing a letter to House Speaker John Boehner and Minority Leader Nancy Pelosi, asking them to work together to reauthorize the funding.
“Failing to renew the SRS program will cause significant harm to the ability of rural and timber communities to provide basic services to their residents,” the letter states. “We urge you to work quickly, in a bipartisan fashion, to reauthorize, fund and make payments under SRS as early as possible in the next Congress ensuring that local governments across the country can access these essential funds.”
“The lack of active management brought about by burdensome regulation and endless litigation has made SRS necessary,” Daines said in a prepared statement. “Increasing responsible timber harvests will provide long-term financial certainty for Montana’s forest counties.”
It’s not unusual for counties to have to wait and see if the SRS and PILT funds will get renewed each year, Pence noted, and the programs are usually tacked on to various bills.
If the money isn’t renewed, though, Pence said he expects there would be an outcry and possibly legal action.
“Every year we pretty much go through this same process, then they pull it off sometime down the road,” he said. “If they refuse to fund, I assume there would be some significant action taken.”