Our View: Stable PILT funding is only fair
February 1, 2014
We were heartened by the news this week of the bipartisan support reflected by the U.S. House of Representatives passage of a new farm bill with funding for Payments in Lieu of Taxes, or PILT, to counties across America tacked on. The federal government pays PILT to counties to offset property taxes lost to the federal lands within their borders.
Those federal lands, including national forests, parks and monuments as well as Bureau of Land Management tracts, are immune from taxes. But local governments like Routt and Moffat counties aren't immune from the expenses they incur maintaining the roads that lead to the those federal lands and the law enforcement calls they are obligated to respond to there.
It's only fair that the federal government offsets the lost taxes — those federal lands essentially are subtracted from counties' assessed valuations.
Nationally, the payments add up to $400 million paid to 1,900 counties in 49 states in 2013. PILT payments in Colorado in 2013 added up to $31.9 million.
In Colorado, with a total land base of 66.7 million acres, 22.9 million are either Forest Service or BLM lands. Nevada comprises 70.7 million acres and of the total 53.9 million are either Forest Service or BLM, with the BLM accounting for more than half of the state's land mass at 48 million acres.
It's no wonder there is growing sentiment among the Great Basin states to have some federal lands returned the private sector when they watch politicians playing fast and loose with their PILT money.
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The potential loss of PILT payments would have forced county governments across Colorado to adjust their budgets, sometimes in painful ways. We commend Routt County officials for playing it smart, and instead of depending on PILT funds for it operating expenses, placing them in the county's highway maintenance fund. We can't afford to defer maintenance on county roads for many years, but we can get by for a couple of years without the PILT monies Congress owes us.
Routt County received $1.47 million in PILT monies based on its 661,363 acres of public lands. Moffat County received less, $554,000 for its 1.67 million acres of public lands because federal mineral leasing royalties are deducted from PILT funding.
There was one sobering note sounded along with the good news about PILT monies this week — while the new ag bill will be in place for five years, that won't be the case for PILT monies. PILT funding will be subject to appropriation during the 2015 budget process when once again small rural counties likely will be left hanging in suspense during an era of political gamesmanship in Washington, D.C.
When we consider that the principle of PILT payments is based on fairness to begin with, we think that's unacceptable. It's tempting to take the position that the PILT program should be made permanent.
But we hesitate to bind Congress in times of national fiscal crises like the one from which we are emerging.
Instead, we call upon Congress to act on a five-year PILT plan in 2015 so that small governments can pay as they go like Routt County does, and plan for the future.
Those of us with mortgages never take a year off from paying our annual property tax bill. The same should be true of Congress.