County anxiously awaits to see if SRS will slip through Congress one more year

By Elizabeth Morgan

Several articles have appeared in the media lately regarding the chances of reauthorization of the Secure Rural Schools Act (SRS) by Congress this next year. The issue was at a standstill when Congress broke for the holidays and will resume in January.

The Secure Rural Schools (SRS) program was created in 2000 to help counties fund the services they could no longer afford because of lost tax revenue. Thirty-five of 44 Idaho counties receive SRS payments, and Idaho ranks third in the country in total SRS dollars. But the program was always intended as a safety measure until Congress could find a more permanent solution.

The White House threatened a veto on the last bill from House Republicans calling for an increase in logging across all national forests. Opponents said it would jeopardize the habitat of endangered species, increase lawsuits and limit the president’s ability to create national monuments.

Hopefully, the break will allow both sides to entertain proposals somewhere in the middle that will provide a viable solution.

Clearwater County Commissioner Don Ebert said, “The county wouldn’t feel the impact immediately. Primarily, county roads and the Sheriff’s Office would be affected if some compensation isn’t made. There are a lot of counties in Idaho that will be in a bad way if it doesn’t come through.”

Ebert hopes to have an answer within the next month, “However, I will not be surprised if it should take longer,” he said.

The county will receive Payments in Lieu of Taxes (PILT) funds for this year.

The National Association of Counties (NACo) reported earlier this month that lawmakers appointed $372 million for PILT in its end-of-year spending package for 2015.

“Because National Forest counties are entitled to more PILT funding, the two programs are closely linked,” wrote Brian Namey with NACo. “Without securing full SRS funding before PILT payments are disbursed in mid-2015, there will be a significant impact on the funds available for all counties with federal lands.”

Living within our means, a summary of this year’s county budget

By Elizabeth Morgan

Between a myriad of Monday meetings on Sept. 22, I spoke with Clearwater County Commissioner Don Ebert concerning the 2014-2015 Fiscal Year’s budget.

I asked how this year’s budget compared to last year’s and if there had been any significant changes to report.

“We held the line on our budget, because as always we don’t know what our PILT or SRS funds are going to be. We were pretty conservative,” admitted Ebert. “There were no wage increases given this year to staff. There is no expansion. We don’t try to take on more than we can pay for, because we are pretty well where we need to be as far as what we can afford and live within our means.”

Ebert reported that the county has good fund balances and they want to keep it that way. “We cut back on our spending a long time ago, before we ran out of money so in that sense the budget is healthy.”

“There are a couple of things to consider when planning a budget based on projections,” Ebert said, “which in a lot of ways are just an educated guess. The main thing in my mind is how much is spent. Even though something is allotted for in the budget, doesn’t necessarily mean it must be spent.”

As in the process of setting most any budget, Clearwater County Commissioners put together the best estimate of what they believe the next year will hold as far as revenue and expenses. However, as in the case of funding from SRS and PILT, there’s really no way to do anything but give it their best guess.

I asked Ebert how severely the funds from SRS and PILT fluctuate from year to year. “The funds don’t fluctuate so much,” he responded, “the question is more about if congress will act and if we get them out or not.”

In the past, the county has received them every year. Some would say it’s a pretty safe bet that they will continue, but how far is the county willing to go out on that limb? “If you start talking about spending money that you don’t have yet, it’s kind of precarious.” said Ebert, “We’ve always opted towards the more conservative side and we have good fund balances because of that.”

Ebert shared that when there is an excess it is carried over to the following year’s budget. Auditors recommend sufficient money in the balance to run for three months or around 25% of the year’s budget, and in that case, there must be cash on hand to run the county.

As in other budgets, there are also the unexpected expenditures that come up occasionally, so the county budgets must consider budgeting more money than what is actually intended. The excess is always carried over. “It’s kind of hard to predict,” he said.

Winter weather plays into the ways the county’s unforeseen expenses. Depending on the amount of snow, time and resources to maintain the roads accessibility could consume a substantial portion of the budget. “I’m not sure if during the wintertime, the county could ever plow the roads often enough to keep everyone happy. But the roads are what they are and this is rugged terrain,” stated Ebert. “We do the best we can with what we have. Fortunately winter comes first and we have the rest of the year to adjust if needed.”

Ebert explained “You have to spend enough to keep the county functioning properly, but at the same time, we don’t want to spend it if it isn’t necessary. It’s a constant judgment call. We examine each item on a regular basis to make sure it is necessary. It’s a fine line and so far we’ve been pretty lucky. I feel we have provided adequate services and have done so within our means.”

“The county has enough to operate a couple of years to avoid running into a brick wall, should funding from SRS and PILT be cut,” assured Ebert, “but there would certainly be significant changes in the manner in which the county spends their money.”

Federal government wants Idaho school funds back

The federal government has sent a letter to the governor’s office demanding a return of 5.1 percent of the Secure Rural Schools (SRS) funds that were distributed to counties, highway districts, schools, and Resource Advisory Committees (RAC’s) across Idaho. 

The letter allows the Governor’s office two options: a) the money can be collected back from all the receiving entities at 5.1 percent, or b) 5.1 percent of the total can be withheld from the Resource Advisory Committees.

In an effort to protect the taxpayers of Clearwater County, the commissioners sent a letter to the governor requesting that he choose the second option. If the monies were withheld from the tax supported entities it could result in higher property taxes.  
The RAC’s don’t receive any local property tax dollars. The RAC’s were established as part of the original legislation that started payments to local entities to compensate them for revenue losses caused by cutbacks in logging on federal forest lands. RAC’s are made up of representatives from a wide variety of groups interested in the management activities on the forest. The RAC’s get a percentage of the secure rural schools’ money each year to spend on special projects on the National Forest.  
This is the last payment under the Secure Rural Schools legislation, and the odds of getting it reauthorized are looking dismal. The tax supported entities who just received their last check are facing significant revenue shortfalls in the next fiscal year. Clearwater County’s portion is over $550,000, all of which goes into the road department. The local highway district and schools receive lesser amounts.  
When asked to comment on the return of SRS dollars, Commissioner Stan Leach said, “This is indicative of the state of affairs in Washington, D.C. right now. The federal government is going back on its promise that it made to support roads and schools when the forests were put into reserve in 1908. So, not only can we not count on that support into the future, we can’t even cash the checks that have already been sent. This really points out the need for more active forest management so that we can pay our own way and not have to count on the whims of Washington, D.C.”  
There are several efforts underway to increase forest management. Commissioner Don Ebert is working as part of the Clearwater Basin Collaborative to accomplish this. Commissioner Leach is working with the other county commissioners around the state to establish a Community Forest Trust, where a portion of forest lands would be managed on a sustainable basis with generated revenues helping to offset some of the shortfalls created by expiration of the SRS legislation.  
There is also an effort to authorize another SRS type bill, but even that would only be a temporary fix.

“A permanent solution has to be found,” said the commissioners, “because even if the SRS funds stop coming, the needs that those funds pay for will not.”