Secure Rural Schools and Community Self Determination Act

Should the federal government sell off land to support rural schools? That's the issue behind legislation co-sponsored by U.S. Senators Max Baucus (D-Montana) and Ron Wyden (D-Oregon) to fund the Secure Rural Schools and Community Self Determination Act without selling public lands.

The bill will raise $2.6 billion over the next ten years for the rural schools program, commonly known as the county payments law, by closing a tax loophole that allows some government contractors to avoid their tax obligations. In 2005, Wyden, along with Sen. Larry Craig (R-Idaho) and Baucus, introduced a bill to reauthorize the county payments law for another seven years. The original law is due to expire at the end of this year.

The bill is in response to the Bush Administration's proposal to sell as many as 300,000 acres of Forest Service lands to raise about $800 million for the program. The legislation would provide a steady revenue stream for the county payments law by closing a tax loophole in Federal contracts. Under current law, the Federal government does not withhold taxes owed from government contractors that provide goods and services to the Federal government. As a result, some contractors don’t comply with Federal tax law.

“Our bill will fully fund the rural schools program without selling even one acre of our prized public lands,” said Baucus, the highest-ranking Democrat on the Senate Finance Committee, which has jurisdiction over tax policy. “Our public lands shouldn’t be put up for sale to the highest bidder. The Administration challenged congress to find a way to fund this program -- Ron and I just did.”

“Rural communities throughout the country rely on these payments for top quality schools and infrastructure year in and year out,” said Wyden. “We cannot abandon them, and this legislation finds a fiscally responsible way of extending this successful law.”

The county payments law, first enacted in 2000, established a six-year payment formula for counties that receive revenue sharing payments for the USFS and Bureau of Land Management (BLM) lands. Based on historical timber receipts, the formula established a stable source of revenue to be used for education, roads and various other county services in rural areas.

Senator Baucus, along with Senator Ken Salazar (D-Colorado), was one of the first members of Congress to condemn the land sales proposal.