After a long fight to receive county timber payments for the secure rural schools program, the Umatilla County Board of Commissioners decided to opt out of the program.
Instead, the county is getting moneys from Payment in Lieu of Taxes, or PILT, a similar federal program to help offset losses in property taxes due to nontaxable federal lands within a county's boundaries. In Umatilla County's case there are 419,465 acres of federal land and the PILT pays $2.29 per acre.
This year, unlike other years, said Commissioner Bill Hansell, the PILT payment program (which dates back about 30 years) was included in the same bill as the timber payments. Also this year, unlike in other years, the federal government chose to fund PILT to its full capacity.
"It's always been on formula of partial funds," Hansell said. "In other words the federal government would acknowledge if it paid it all, it would be this amount, but they always paid a portion. This year, for the first time ever, it had full funding."
In discussing the issue in the commissioner's administrative meeting Monday, Hansell advocated for opting for PILT because of the amount of money from the program, the county's ability to determine how the funds are used and sustainability.
Umatilla County would have gotten about $1.13 million through the timber payments, about $280,000 more than through PILT, which will amount to about $950,000. The PILT payment includes the traditional, 100-year-old county timber payments, for which the county receives 25 percent of the timber cut.
While the timber payments would mean more money, the real difference comes into play in how the county can use the funds.
Hansell said timber payments split the $1.13 million into four areas: the Oregon community school fund (which takes moneys from across Oregon and redistributes it on a per-student basis to all the schools), the county road department, Title II and Title III (special projects on federal lands) and a PILT within timber payments. In the timber payments, only about $198,000 fell into the PILT category, which is what the county can use as discretionary funds.
But with the $950,000 PILT, all of it is under the county's discretion, Hansell said.
To illustrate his point, Hansell drew two pie graphs on a white board. A larger pie represented the timber payments and a smaller pie represented PILT. He cut the timber payments pie into four slices while the PILT pie remained whole.
Hansell explained it was a bigger pie, but there's more slices out of it and the only discretionary slice is the $198,000 PILT.
"Everything else on that pie, we have no discretion over," he said.
The PILT pie is slightly smaller, but the county gets the whole $950,000 pie.
"All this comes back to the county totally at our discretion," he said.
Another reason Hansell advocated for PILT was sustainability.
Over the next four years, timber payments gradually will decrease until it is at 40 percent of its current payment. As it decreases, the PILT within timber payments will increase, but not enough to even out the losses.
The independence PILT, on the other hand, will last for the next five years and will not decrease.
Also, because PILT is a 30-year-old program, Hansell said there will be less of a fight to keep it going, unlike timber payments.
"It's not a new program and it's got a whole different history and mindset about it in Congress," Hansell said. "So the stability of that funding on the long term has a better history than Secure Rural Schools."
Even though Umatilla County won't be using the timber payments program, Hansell said the fight to get it passed through Congress was worth it. He said the only reason the county decided to opt out was because PILT ended up being fully funded. Had PILT not been fully funded, the county would participated in timber payments program.
"For us it created a different playing field," Hansell said. "We needed to look at it because the PILT funds were more than we had traditionally and the resource was 100 percent discretionary. I think for most of Oregon counties that have timber, Secure Rural Schools will most likely be the direction they are going."
Hansell also cautioned that for the first year, the county will not receive the full amount of the PILT because it did receive emergency timber payments funding last year and the PILT subtracts any other federal dollars the county accepts. But in the subsequent four years, Hansell said the county will receive the full PILT.