Rural schools and county governments are struggling to figure out how they will fund essential projects next year amid the looming expiration of the Secure Rural Schools Act, which provides federal assistance to offset the loss of property tax revenue on public lands.

As lawmakers try to extend the law before it expires Sept. 30, counties and school districts are facing the possibility that they will have to lay off personnel, halt road and bridge projects or limit wildfire prevention.

“It’s absolutely lifeline money,” said Trinity Alps School District superintendent Jaime Green, who anticipates his Northern California District would lose about $600,000 annually if the program expires.

The funds, Green said, are essential for rural school districts like Trinity Alps, which enrolls 657 students. He has enough funds to hold on to staff through the end of the 2024-25 school year, but if no payments come in by next March, he expects seven employees will be laid off for the subsequent school year. 

The National Forest System covers approximately 196 million acres in the U.S., spanning from West to the northern Midwest to the Appalachian Mountains. Its’ roots lie in Congress’ 1891 decision to grant the President power to create “forest reserves” to protect forestland, influence the flow of water and have a “continual supply” of timber for the U.S. population.

County governments, however, are unable to collect taxes from these federally held forestlands, and the creation of this new system made it difficult for several counties to find funding to support schools, roads and other local services for their often-rural populations. 

“When you take that much land off the tax roll, you’re just putting a bigger tax burden on the remainder of the people of that county,” said Lonnie Hunt, executive director of the Deep East Texas Council of Governments.

Congress sought to address this by allowing counties to access a share of their funding from federal timber sales in 1908, and while this model worked for a significant amount of time, the dollars counties received began to decline in the late '80s after most national forests scaled back grazing, timber management and mining activities on their lands for environmental reasons.

In 2000, Congress approved the Secure Rural Schools Act. The program distributes federal funding to counties with Forest Service lands based on historic revenues, area of eligible federal lands, and county incomes, according to the Congressional Research Service. 

These funds are often used for rural schools, but also can go to road and bridge projects, fire district functions and public health services. A total of $232.4 million in program funds were distributed by the U.S. Forest Service for the 2023 fiscal year.

Eighteen Western Oregon counties containing lands managed by the Bureau of Land Management are also eligible for the program. In all, 745 eligible rural counties across the West, northern Midwest and Appalachia could lose access to program payments they’ve come to rely on. 

Counties already received this year’s payments in April. If an extension is not passed, they will not receive payment at the same time next year, said Mark Ritacco, chief government affairs officer for the National Association of Counties.

Many counties are already drafting budgets for next year and may decide not to carry out road and bridge projects or retain all employees because of the uncertainty, he added.

“Even though they won’t miss the payment until [next year], it’s kind of urgent now,” Ritacco said.

Tom O’Malley, superintendent of Modoc Joint Unified School District in northeastern California, expects his district can weather a year without the payments, in part because it has been able to save some money due to a teacher shortage that has made it difficult to hire new candidates.

“We’re not in dire straits because kids are being underserved,” he said. 

O’Malley said his district generally reserves the Securing Rural Schools Act payments for one-time purchases like facility upgrades, school buses, athletic uniforms and technology, due in large part to the unpredictability of the program’s reauthorization. But he added that “when that source of revenue goes away, all those things go away also.”

Authorization for the program lapsed once before — in 2016 — and the loss of funding had consequences for schools. Trinity Alps, for example, did not receive its expected $1 million payment and was unable to spend the money needed to fix its leaky roofs, Greene said. Toxic mold was found three years later, forcing students to work in portable buildings until the school could be renovated.

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“Our district of 700 kids absolutely got the wind knocked out of us,” Greene said.

Across other California counties, the 2016 lapse led to school facilities not getting updated and fire district budget cuts, said Mary-Ann Warmerdam, senior vice president of governmental affairs for the Rural County Representatives of California. It also had impacts to teacher salaries and road budgets, she said.

Expiration of the program would not end payments to counties entirely, but it would limit them. If an extension is not passed, the system would revert to its pre-SRS Act status and pay counties based on federal timber sales. When this happened in 2016, CRS noted that county payments were “significantly lower than the payments received under SRS.”

Lawmakers from forested districts have proposed measures to extend the program. The challenge is finding legislation to put it in.

“This is a bill that’s not going to move on its own; it has to be attached to a bigger vehicle,” said Noelle Ellerson Ng, a policy analyst for the School Superintendents Association. “And in a Congress that’s not moving bigger vehicles, that means every bill it’s getting in, there’s something else that isn’t.”

A bill to extend the program through 2026 passed the Senate Energy and Natural Resources Committee in December, but has not appeared on the floor. The bill was sponsored by Sens. Mike Crapo and Jim Risch of Idaho and Ron Wyden and Jeff Merkley of Oregon. 

Meanwhile, Reps. Joe Neguse, D-Colo., Cathy McMorris Rodgers, R-Wash., and Val Hoyle, D-Ore., have proposed companion legislation in the House. 

“We've worked to make the case that the bill should be considered in regular order,” Neguse told Agri-Pulse. “And if that isn't an option, then we should ultimately consider it in whatever other vehicle is available.”

A version of the House proposal is included in the text of the farm bill that was advanced by the House Agriculture Committee in May but is considered unlikely to pass this year. Some House lawmakers tried but failed to add the measure to the National Defense Authorization Act. 

“My colleagues and I understand the urgency of this moment, which is why all options remain on the table to ensure we prevent this critical and widely popular program from expiring,” McMorris Rodgers told Agri-Pulse in a statement. “Encouraging conversations continue to take place on both sides of the aisle, and I’m optimistic we will find a way to get this done for the people who are counting on us.”

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