June 22, 2008

What will counties do?
In some counties, loss of payments means loss of service

By RODGER NICHOLS
of The Dalles Chronicle

     The U.S. House of Representatives passed a massive appropriations bill Thursday that continues funding for the war in Iraq and is loaded with domestic spending.
     It did not, however, contain funds to continue a program which makes up for declines in logging revenues that help pay for schools, roads and public safety funding to 700 rural timber counties in 39 states.
     That represents a potential $400 million loss for those counties, including more than $17.4 million total in Wasco, Hood River, Klickitat and Skamania counties.
     According to Rep. Peter DeFazio, D-Ore., he was not able to convince the House leadership or the White House to include the program in the House version, though the Senate version of the bill, due to come up for a vote next week, does carry the provision.
     “I’m obviously fundamentally and profoundly disappointed that the Democrat leadership of the House has chosen not to pick up where our senators left off,” said Rep. Greg Walden, R.-Ore.
     “As you know, the president signed the war supplemental last year that included the county payments funds,” he added, “so I highly doubt it would have veto-bait this year.”
     DeFazio said, “Our only hope now is that the Senate will insist and hold the line on county payments, If they do, that should get the attention of the White House.”
     But Walden was less optimistic.
     “This is the emergency funding vehicle, he said, “and it just left the station without us. That is a profound disappointment and will cause major hardship in our counties.”
     Just how big an impact will this have on gorge counties?

WASCO
     “In some ways we’re more fortunate than a number of counties,” said Commissioner Sherry Holliday. “Our money was put into the road department, not into our general fund.”
     And, she said, commissioners made the decision last year to cut back the road department, anticipating that the revenue they’ve counted on might not be available in the fiscal year that starts July 1, just over a week away.
     “Our crystal ball said that it’s not going to happen and we needed to adjust,” said Wasco County Roadmaster Marty Matherly. “It looks like Congress has done it again and we’re definitely not going to get [federal payments to counties] this year.”
     Matherly said the county road department downsized by seven fulltime and two parttime employees last year, though he had been able to hire two experienced employees back due to a pair of retirements in the department.
     “It restricts our work to a point where we are not going to be able to do as nearly much as we used to, because of the lack of manpower. We’re still going to do the same maintenance projects. You know we have to brush our roads. We have to grade them, ditch them and clean culverts, but we’re just limited.”
He said the reductions also affected winter snow removal.
     “We used to be able to go out there and use road graders in the high traveled areas,” he said, “but now in order for us to cover that territory, we’re using truck plows. We’re able to get as many as we can done, but it’s not nearly as clean a job.”
     Matherly also ticked off the reduction in snow removal personnel: “We’re down to one person in Antelope district, he said; “we’re down to two people in Wamic — and we used to have four. In Dufur we don’t have anybody and Mosier is down to one person, when we used to have two.”
     Still, Matherly said he was hopeful.
     “We’re trying a lot of different things, looking at a lot of different angles, the state is trying to step up and help, and our guys are doing the best they can to get things done.”

HOOD RIVER
     “It’ll be about a million and half dollars a year lost in our in road fund,” said Hood River County Administrator David Meriwether, “and probably a couple hundred thousand dollars a year in our search and rescue fund, as well as a lot of things we were available to accomplish through Title 2 and Title 3 over the years.”
     Like Wasco County, Hood River did not plan for federal payments to counties in their 2008-2009 budget, which was adopted Monday.
     He said the county had also put some funding aside each year for the past few years to cushion the blow in the event the county payments funding dropped out.
     “We will use some of those funds to carry us through this next year as we embark on a plan to determine what we’re going to do long term,” Meriwether said.
     “We have enough to get us probably three years of loss,” he said, “but you don’t want to spend it all down and then figure out what you want to do.”
Meriwether said Hood River County had tried to be very conservative in its approach, understanding the funding might go away.

KLICKITAT
     While Wasco, Hood River and Skamania counties federal timber payments have figured in the millions, Klickitat County has a comparative dearth of forest land, with payments averaging less than $180,000 annually.
     County officials were returning from an Association of Washington Counties meeting, and were unavailable for comment

SKAMANIA
     “Yesterday was a long day,” said Skamania County Commissioner Paul Pearce, talking about Thursday, the day of the House vote.
     “I think I was on three conference calls,” he said. “We’re asking the Senate to put it back in, but the Pentagon’s out of money, and if they put it back in, it just gets sent back over to the House, where they will take it out. I think that vehicle has left the station.”
     Skamania County is heavily forested, and has received more than $11 million annually, though something over $3 million of that figure goes to the Stevenson-Carson School District.
     “What our message has been is that the amount of money we get in Skamania County equals 75 employees, and we have about 200,” he said. “It’s 47 percent of our current expense fund, what you [in Oregon] would call the general fund.”
     He said federal county payments provide 40 percent of the school district’s general fund budget.
     “This is just devastating to our district,” said Stevenson-Carson School District Superintendent Bill Hundley.
     “We’ve got kids who are depending on teachers who are depending on classified staff,” he said. “If, indeed, we don’t have this funding going forward, this is not going to be the same district, and that’s going to be a terrible problem.”
He said the district school board had voted not to lay off any employees in the middle of the school year, when funding would run out without the federal county payments.
     Instead, he said, the district will spend down its store of reserves.
     If somehow funding is restored for the following year, he said, the district would not have lost any experienced teachers or other employees,
“We’re still hoping for reauthorization in August or even September,” said school board member and former chair Scott Pineo.
     If not, he said, “We are extremely concerned about this for the long-term implication that it has.”
     And Superintendent Hundley said, “We’re gonna get busy and look at how we can pare out budget over the next two years to live within the finances that we have. We’ll also be looking at enhancing our revenues through some nontraditional means,” he said.

ABOUT COUNTY PAYMENTS
     Before passage of the county payments law, Oregon counties were receiving payments as the result of 1908 and 1937 laws specifying that the government share 25 percent of U.S. Forest Service receipts and 50 percent of Bureau of Land Management receipts with counties in any state that hosts federal land from which timber is cut. These payments had been used to help finance rural schools and roads. Toward the mid-to-late-nineties, however, the principal source of those revenues, federal timber sales, declined by over 70 percent nationwide.      Consequently, the corresponding revenues shared with rural counties throughout the country declined precipitously, hurting school and transportation funding.
     In 2000, legislation to remedy this imbalance was enacted into law, establishing a six-year payment formula for counties that receive revenue-sharing payments for Forest Service and Bureau lands. The formula established a stable source of revenue, to be used for education, roads and county services in rural areas. The safety net amount was based on historical timber receipts.
     In 2007, a one-year extension of the program was added to the supplemental war spending bill, which was enacted.