SPEAKERS CONTENTS INSERTS
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THE COUNTY SCHOOLS FUNDING REVITALIZATION ACT OF 1999
SUBCOMMITTEE ON DEPARTMENT OPERATIONS,
OVERSIGHT, NUTRITION, AND FORESTRY
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
JULY 15, 1999
Page 2 PREV PAGE TOP OF DOCSerial No. 10628
Printed for the use of the Committee on Agriculture
COMMITTEE ON AGRICULTURE
LARRY COMBEST, Texas, Chairman
BILL BARRETT, Nebraska,
JOHN A. BOEHNER, Ohio
THOMAS W. EWING, Illinois
BOB GOODLATTE, Virginia
RICHARD W. POMBO, California
CHARLES T. CANADY, Florida
NICK SMITH, Michigan
TERRY EVERETT, Alabama
FRANK D. LUCAS, Oklahoma
HELEN CHENOWETH, Idaho
JOHN N. HOSTETTLER, Indiana
SAXBY CHAMBLISS, Georgia
RAY LaHOOD, Illinois
JERRY MORAN, Kansas
BOB SCHAFFER, Colorado
JOHN R. THUNE, South Dakota
Page 3 PREV PAGE TOP OF DOCWILLIAM L. JENKINS, Tennessee
JOHN COOKSEY, Louisiana
KEN CALVERT, California
GIL GUTKNECHT, Minnesota
BOB RILEY, Alabama
GREG WALDEN, Oregon
MICHAEL K. SIMPSON, Idaho
DOUG OSE, California
ROBIN HAYES, North Carolina
ERNIE FLETCHER, Kentucky
CHARLES W. STENHOLM, Texas,
Ranking Minority Member
GEORGE E. BROWN, Jr., California
GARY A. CONDIT, California
COLLIN C. PETERSON, Minnesota
CALVIN M. DOOLEY, California
EVA M. CLAYTON, North Carolina
DAVID MINGE, Minnesota
EARL F. HILLIARD, Alabama
EARL POMEROY, North Dakota
TIM HOLDEN, Pennsylvania
SANFORD D. BISHOP, Jr., Georgia
BENNIE G. THOMPSON, Mississippi
JOHN ELIAS BALDACCI, Maine
Page 4 PREV PAGE TOP OF DOCMARION BERRY, Arkansas
VIRGIL H. GOODE, Jr., Virginia
MIKE McINTYRE, North Carolina
DEBBIE STABENOW, Michigan
BOB ETHERIDGE, North Carolina
CHRISTOPHER JOHN, Louisiana
LEONARD L. BOSWELL, Iowa
DAVID D. PHELPS, Illinois
KEN LUCAS, Kentucky
MIKE THOMPSON, California
BARON P. HILL, Indiana
WILLIAM E. O'CONNER, JR., Staff Director
LANCE KOTSCHWAR, Chief Counsel
STEPHEN HATERIUS, Minority Staff Director
KEITH WILLIAMS, Communications Director
Subcommittee on Department Operations, Oversight, Nutrition, and Forestry
BOB GOODLATTE, Virginia, Chairman
THOMAS W. EWING, Illinois,
RICHARD W. POMBO, California
CHARLES T. CANADY, Florida
Page 5 PREV PAGE TOP OF DOCJOHN N. HOSTETTLER, Indiana
SAXBY CHAMBLISS, Georgia
RAY LaHOOD, Illinois
JERRY MORAN, Kansas
JOHN COOKSEY, Louisiana
GREG WALDEN, Oregon
EVA M. CLAYTON, North Carolina,
Ranking Minority Member
MARION BERRY, Arkansas
BENNIE G. THOMPSON, Mississippi
VIRGIL H. GOODE, Jr., Virginia
DAVID D. PHELPS, Illinois
BARON P. HILL, Indiana
MIKE THOMPSON, California
GEORGE E. BROWN, Jr. California
DAVID MINGE, Minnesota
C O N T E N T S
H.R. 2389, To restore stability and predictability to the annual payments made to States and counties containing National Forest System lands and public domain lands managed by the Bureau of Land Management for use by the counties for the benefit of public schools, roads, and other purposes
Page 6 PREV PAGE TOP OF DOC Clayton, Hon. Eva M., a Representative in Congress from the State of North Carolina, opening statement
Goodlatte, Hon. Bob, a Representative in Congress from the State of Virginia, opening statement
Stenholm, Hon. Charles W., a Representative Congress from the State of Texas, prepared statement
Thompson, Hon. Mike, a Representative in Congress from the State of California, opening statement
Boyd, Alan Jr., a Representative in Congress from the State of Florida
Collins, Claire A., county administrator, Bath County, VA
Deal, Hon. Nathan, a Representative in Congress from the State of Georgia
Douglas, Robert E., president, National Forest Counties and Schools Coalition
Evans, Mark, Trinity County Judge, Groveton, TX
Hanline, Walt L., superintendent, Del Norte County Unified Schools District, Crescent City, CA
Page 7 PREV PAGE TOP OF DOC Lyons, James R., Under Secretary, Natural Resources and Environment, U.S. Department of Agriculture
Peterson, Hon. John E., a Representative in Congress from the State of Pennsylvania
Spain, Glen, northwest regional director, Pacific Coast Federation of Fishermen's Associations
Turner, Hon. Jim, a Representative in Congress from the State of Texas
Davis, James T., superintendent, Centerville Independent School District, Trinity County, TX, statement
Glickman, Hon. Dan, Secretary of Agriculture, letter of June 7, 1999 to the Speaker
Green, Bobby, chairman, Lane County Board of Commissioners, statement
Hunter, Bruce, director, of public affairs, American Association of School Administrators, statement
National Education Association, statement
THE COUNTY SCHOOLS FUNDING REVITALIZATION ACT OF 1999
THURSDAY, JULY 15, 1999
House of Representatives,
Subcommittee on Department Operations,
Page 8 PREV PAGE TOP OF DOCOversight, Nutrition, and Forestry,
Committee on Agriculture,
The subcommittee met, pursuant to call, at 10:00 a.m., in room 1300, Longworth House Office Building, Hon. Bob Goodlatte (chairman of the subcommittee) presiding.
Present: Representatives Walden, Clayton, Berry, Goode, Phelps, Thompson, and Stenholm [ex officio].
Staff present: Kevin Kramp, staff director, Subcommittee on Department Operations, Oversight, Nutrition, and Forestry; David Tenny, Callista Bisek, Wanda Worsham, clerk; Danelle Farmer, and Quinton Robinson.
OPENING STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF VIRGINIA
Mr. GOODLATTE. Good morning. This hearing of the Subcommittee on Department Operations, Oversight, Nutrition, and Forestry to review H.R. 2389, the County Schools Funding Revitalization Act of 1999, and a legislative alternative submitted to Congress by the administration will come to order.
I have an opening statement. I would first like to warmly welcome my colleagues who are here today as original cosponsors of this important legislation. I also welcome Under Secretary Lyons and our other witnesses, many of whom have traveled long distances to join us this morning.
I am particularly pleased to welcome Claire Collins who is the Bath County administrator in Bath County, VA in my congressional district. Administrator Collins, it is a pleasure to have you with us this morning.
Before I proceed with my opening statement, I would like to acknowledge and thank my colleague from North Carolina, Representative Eva Clayton, and my colleague from Texas, Representative Charlie Stenholm, two long-time friends of rural America who played a significant role in making this hearing possible through their support of the National Forest Counties and Schools Coalition's efforts. The overriding issue that concerns us today is how to best restore and maintain the well-being of rural school children, their families, and the communities in which they live.
Page 9 PREV PAGE TOP OF DOC Nearly 100 years ago, the Federal Government, as a condition of managing our National Forestlands, established a compact with forest-dependent communities in rural America. Under the terms of this compact, the Government would own and manage the forest, not only for the longterm environmental benefit of the resource, but also the longterm social and economic benefit of rural communities in and adjacent to the forest.
Today, 90 years later, we have arrived at a crossroads. Federal timber sales have plummeted by over 70 percent from historic averages. Revenue sharing payments with rural communities, guaranteed under the compact, have dropped in some communities by as much as 90 percent.
Schools have canceled classes, cut teachers, eliminated extra-curricular activities, and cut corners in every conceivable way to keep their door open. Local economies have been decimated, and families dislocated as parents desperately seek to make ends meet by looking for work anywhere they can find it.
Tragically, at the center of this collapse are innocent school children who look to their parents, to their teachers, to their communities, and to us in this committee room to help restore their quality of education, and their quality of life. Today, rural America is here to present to this subcommittee their recommendation for fixing the compact and restoring a measure of hope to their school children, their families, and their communities.
That recommendation is H.R. 2389, the County Schools Funding Revitalization Act of 1999. This bill is premised on a set of carefully crafted compromise principles adopted by the National Forest Counties and Schools Coalition, a unique and diverse, grassroots coalition of over 550 local and national organizations representing rural communities in 35 States.
This is a remarkable coalition, similar in nearly every material way to the Quincy Library Group in the way it has come together, adopted a core set of principles, and then brought their locally-conceived ideas to Washington seeking our help to make them work on the ground.
Page 10 PREV PAGE TOP OF DOC As we consider this legislation today, we as members of this subcommittee are faced with one overriding question. I want everyone here today to pay close attention to this question because it lies at the heart of what this hearing is all about.
That question is, who knows better what needs to be done to help forest-dependent communities in rural America; rural America or Washington? In other words, are we in Washington going to support the locally-conceived ideas and efforts of our rural communities, or are we simply going to tell rural America to check their ideas at the door once they cross the Beltway, because successful grassroots coalitions and homegrown compromise proposals really do not matter here? Are we going to tell them to take their 550 members from 35 States and go home, because we in Washington have already arrived at a better solution?
My colleagues, I hope we are not so arrogant as to presume we in Washington know better than our rural communities what is best for their children, their families, and their communities. Legislative Band-Aids from Washington bureaucrats will not heal the wounds of rural America.
To somehow believe that they will would be far worse than mere arrogance. It would be a direct affront to the underpinnings of our representative form of government. After all, we are here to serve the people and to do our best to meet their needs and make their ideas work, not the other way around.
Rather than take an inflexible, hardline, ''it is my way or the highway'' position, I hope that each of us in this room today will be fully committed to help the proponents of H.R. 2389, the families, and communities of rural America achieve what they have set out to achieve, a revitalization of their compact with the Federal Government in a way that will truly benefit their children and maintain the ecological, social, and economic integrity of our forests and forest-dependent rural communities in both the short and long term.
[H.R. 2389 follows:]
Page 11 PREV PAGE TOP OF DOC "The Official Committee record contains additional material here."
Mr. GOODLATTE. With that, it is my pleasure to yield to my friend and colleague, the distinguished ranking member of this subcommittee, Mrs. Clayton of North Carolina.
OPENING STATEMENT OF HON. EVA M. CLAYTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH CAROLINA
Mrs. CLAYTON. Thank you, Mr. Chairman.
I also want to welcome our colleagues who are going to testify. Thank you for holding this hearing on H.R. 2389, the County Schools Funding Revitalization Act of 1999, cosponsored by our colleague Mr. Thompson of California, and the alternatives submitted to the Congress by the U.S. Forest Service.
Additionally, there is a third legislative proposal that addresses this issue, the County Stabilization Act of 1999, cosponsored by Representative DeFazio of Oregon. All three of these proposals share some general goals which I strongly support. I believe that we must stabilize payments to public schools and county governments, and these timber-dependent counties.
We must protect and strengthen rural communities in a meaningful way. We must have, protect, and sustain the ecological environment, while at the same time balancing it with the social and economic needs of these rural communities.
I lived in rural America and represent a predominantly rural congressional district, as does Chairman Goodlatte. Both of us understand rural America. I have served as chair of a county commission and know firsthand the difficulty of passing a budget to support public schools and establishing a county property tax rate. I am aware of the tremendous challenge counties face in providing adequate funding for local schools to prepare our children to compete in the 21st century.
Page 12 PREV PAGE TOP OF DOC Let me add that I feel our schools are the foundation for developing successful young people and strong vibrant communities beside the economists. All counties depend on natural resources available to them to generate revenue. Because of the difficulty in diversifying rural counties, they are more dependent on their natural resources.
These resources provide families with wages and jobs for the citizen who depend on these jobs to support their families. The money they earn goes to pay their personal property taxesover 8 to 10 times, and then at the banks, stores, and businesses within their local communities. Positive change have caused a decline in timber harvest, and subsequently a decline in Forest Service payments because of sales.
There are approximately 800 timber-dependent counties in the United States. These are counties that often have 40, 50, and, in some cases, almost 80 percent of county land that is owned by the Forest Service or other Federal agencies. As the testimonies submitted, there is no other resource of income to replace the loss of revenues to our schools.
Our students in our rural communities bear the brunt of this funding decline. In conclusion, I want to encourage each of our witnesses and the members of this subcommittee to carefully study all of these proposals in an effort to devise a compromise.
I look forward to the testimony from all of the witnesses, especially our colleagues. We assure you that we will give a careful consideration to your recommendation. Again, Mr. Chairman, I want to thank you for your leadership. I want to commend you in holding these hearings and the attitude to find a resolution.
I want to say that we have just received today's testimony from the Department and I just want to challenge our witness from the USDA to submit their testimony a little earlier. It certainly would be helpful if we got this a little earlier so we could have a chance to see it. Thank you, Mr. Chairman.
Mr. GOODLATTE. Thank you. I want to second that request as well.
Page 13 PREV PAGE TOP OF DOC Does the gentleman from Illinois have any opening statement?
Mr. PHELPS. No, Mr. Chairman.
Mr. GOODLATTE. Does the gentleman from California have an opening statement?
OPENING STATEMENT OF MIKE THOMPSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA
Mr. THOMPSON of California. Thank you, Mr. Chairman.
I am coauthor of the bill because I have an area that I represent in California that has been greatly impacted because of the downturn in timber practices and the impact it is having specifically on schools.
I am, however, concerned about a couple of the provisions of the bill that I hope that I can persuade the more senior coauthors and the authors of the bill to work with me on. Specifically, I am concerned about the Forest Counties Payment Committee.
What I think is going to be a great potential for setting up conflict, that will in fact hold schools and school children hostage while we try and discuss bigger issues, albeit spotted owls or what the future of forest practices should or could be.
So, I had hoped to be able to work with you on that to make sure that we do not lose sight of the fact that what we are trying to do is provide a stable funding source for a very important issue.
Again, Mr. Chairman, I would like to thank you for holding the hearing.
Mr. GOODLATTE. Thank you.
Any other statements for the record may be included at this time.
[The prepared statement of Mr. Stenholm follows:]
PREPARED STATEMENT OF HON. CHARLES W. STENHOLM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS
Page 14 PREV PAGE TOP OF DOC Thank you, Mr. Chairman. I want to commend you for having this hearing on H.R. 2389, the Schools Funding Revitalization Act. Eight hundred rural counties with National Forest designations rely on payments from receipts from the National Forest for school and road funding. I believe that the National Forest Counties &Schools Coalition has done a great job of helping to focus attention on this important issue.
Since 1908, the Forest Service has been required by law to share 25 percent of the revenue generated on national forests with the States which has most been often used for school and road funding. In our current universe of over burdensome environmental regulations and court injunctions, the Forest Service has not been able to harvest and sell an ecologically balanced amount of timber.
Our task of finding an ecologically, socially and economically balanced solution will not be easy. However, I am committed to working with all interested parties to find a consensus solution.
I want to make it clear that I support the preservation of our precious natural resources. But, I also believe that this does not have to be done at the expense of communities in rural America.
I do have some concerns with this bill in its current form. But I see it as a great place to start, and I look forward to working with my colleagues to develop an effective legislative solution to this problem
I look forward to hearing today's testimony. Thank you, Mr. Chairman.
Mr. GOODLATTE. At this time, it is my pleasure to welcome our first panel. We have with us the Honorable Nathan Deal of the ninth district of Georgia; the Honorable Allen Boyd of the second district of Florida; the Honorable John Peterson of the fifth district of Pennsylvania; and we hope to have with us before long, the Honorable Jim Turner of the second district of Texas.
Page 15 PREV PAGE TOP OF DOC Mr. Deal, we are delighted to have you with us. Your full statement will be made a part of the record. We welcome your testimony.
STATEMENT OF HON. NATHAN DEAL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA
Mr. DEAL. Thank you, Chairman Goodlatte, and members of this subcommittee. Thank you for allowing us to come and testify. We are here to talk about H.R. 2389, a bill that has been introduced by me and by my colleague, Mr. Boyd, and as Mr. Thompson has indicated, cosponsored by him and many others of this Congress.
We believe that it addresses an issue that in your opening statement you have already alluded to. That is the declining revenue base for those counties who find within their territory federally-held forestlands. The history of this, of course, begins as early as 1907 with the U.S. Forest Service itself acquiring jurisdiction and Congress recognized the impact on local communities.
The next year, in 1908, established the first formula for a revenue sharing base for those counties who saw territory within their communities controlled by the Federal Government through its Forest Service lands. My district, the ninth district of Georgia, is the mountain areas of north Georgia and some 15 of my 20 counties have, within their boundaries, Federal forestlands. They therefore have an impact on their revenue source in terms of funding their local schools, based on the formula that was established in 1908.
As we also know, the lands controlled by the Forest Service have now grown. I believe the total is some 192 million acres. The other portion of federally-controlled land, the Bureau of Land Management is some 2.6 million acres. Both of those have consequences in terms of what they do under the existing legislative formulas.
As we are all aware, basing the revenue stream of 25 percent back to the local communities in terms of Forest Service land, and 50 percent on BLM lands back to the local communities has fluctuated drastically, and in the last few years, has been reduced as the chairman has indicated in some communities by as much as 90 percent.
Page 16 PREV PAGE TOP OF DOC This legislation today is the result of an effort at both the local, regional, and national levels by organizations who are concerned about these issues. The National Forest Counties and Schools Coalition, which constitutes some 500 such organizations, have been the group I think that has the most responsibility and the most credit to be given for the initiation of this proposal today.
I want to thank them for their efforts. We are attempting to resolve this problem in a very short period of time. We have seen these revenues drop drastically. It has affected local communities. As the chairman has said, it has affected the delivery of educational services in local school systems.
As a member of the Education and the Workforce Committee, we are constantly looking, as the entire Congress is looking, for ways to give not only more control to local school districts, but also a greater ability to have revenue to do the things that they need.
This bill provides an alternative to the existing formula. That is that we would take the three highest average years since 1985, use that as the formula base for computing the reimbursement formula back to the local counties. This will give a greater stability to them in terms of revenue that they can anticipate, rather than as currently based on whatever the revenue generated in a particular year might be.
We believe that is a better way of doing it. It is a 5-year interim program. It has built into this component of the legislation an effort through a process of an effort over this 5-year interim period to come up with a more stable, and lasting longterm solution to this issue.
With that, I appreciate the opportunity to testify this morning. I look forward to being able to respond to your questions. Thank you, Mr. Chairman.
[The prepared statement of Mr. Deal appears at the conclusion of the hearing.]
Page 17 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you. Congressman Boyd, we are glad to have you for this as well.
STATEMENT OF HON. ALLEN BOYD, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF FLORIDA
Mr. BOYD. Thank you very much, Mr. Chairman.
I want to thank you and Ranking Member Clayton for holding this hearing and allowing us to present our plan for solving this very serious issue. The issue of forest revenue payments by the Federal Government to local affected communities is very important to the Second Congressional District which I represent.
That district is very rural and encompasses 19 counties, two National Forests, the Apalachicola and the Osceola in the Florida Panhandle. I have been working on this issue since before I got into Congress when I was in the Florida State Legislature.
I am particularly grateful to you all for holding this hearing because I believe this may serve as a springboard for Congress to finally address and solve this issue that adversely affects so many communities around this Nation. Chairman Goodlatte, as you have so effectively described, the Federal Government entered into a compact with rural forest communities in 1908.
Under this compact, the counties were to receive 25 percent of the revenues generated from Federal forestlands, to compensate them or in exchange for a diminished local property tax base. That local property tax base, of course was the source of funding for the school system and the operation of the local governments. By law, these revenues finance rural public schools and local road infrastructure. However, in recent years, as you have described and Mr. Deal has described, these Federal timber sales have been sharply curtailed due to changes in the Federal Forest Management Policy.
Those revenues shared with States and counties have declined significantly. I want you to take a look at the first chart that I have that I have over next to the north wall.
Page 18 PREV PAGE TOP OF DOC [Chart shown.]
You will see the volume of timber harvested in an the Apalachicola National Forest over the last 15 years or so. The interesting or most significant thing about the changes in the policy is not the decline in harvest, but rather the fact that in 1998, the net annual growth of timber on the Apalachicola National Forest was 800 percent greater than the volume harvested.
The soft timber growth was approximately 50 times greater than the amount harvested. As you know, payments to many counties have dropped to less than 10 percent of what they were in the past. This has had a staggering impact on our local schools and our communities.
In fact, if you will look at exhibit 2, it outlines the total revenues that the counties have been receiving from the PILT Program and from the 25 Percent Program in Apalachicola National Forest over a 5- or 8-year period from the late 1980's to the early 1990's dropped 89 percent. This decline in share revenues has severely impacted the educational system in Liberty County.
I know my time is limited. I will not detail all of the painful cuts that have been incurred by communities and schools. I have done that in my written testimony which is available to you. I do want to talk about two specific areas in Liberty County which has most of the Apalachicola National Forest in that county.
First of all is Liberty County, as a result of the decreased funding, is the only county in the State of Florida that does not have an Advanced Life Support System available to its Emergency County Response Organization. It also happens to sit in a very rural area where it is more than an hour's drive to the closest hospital with a trauma center. So, that is a very serious impact on a local government.
Page 19 PREV PAGE TOP OF DOC The other program that I want to outline to you is in the late 1980's, the State of Florida put in place a pre-kindergarten program, 3- and 4-year-old program, that the State and the local governments funded, which really was a very positive program that went a long ways toward helping solve some of the social problems we had in the rural areas. Liberty County was the first school system in the State of Florida to enroll all of the eligible kids in pre-K in the late 1980's.
Today, Liberty County has had to totally eliminate its pre-kindergarten program, 3- and 4-year-old program, because of the significant cuts in the 25 percent payments. Those payments have actually declined from $1.9 million to that little community with about 1,500 students, down to about 200,000 today.
It is clear to me, as you have said Mr. Chairman, that the compact of 1908 has been broken and needs to be fixed immediately. That is why I and my colleague, Representative Nathan Deal, along with cosponsors, many in this room, have introduced the County Schools Funding Revitalization Act.
This legislation is based, as you have heard, on principles that were designed and agreed upon by the National Forest Counties and Schools Coalition; a group of 500 groups, including everybody from school superintendents, county commissioners, educators, and some of those folks are here behind me today, the National Education Association, and the U.S. Chamber of Commerce.
It contains two major provisions. First of all, it restores stability to the 25 percent payment by ensuring a predictable payment that is a 3-year average from 1985 to the current. In addition to that, it requires the Federal Government to collaborate with the local community and school representatives as a part of the Forest County Payment Committee which Mr. Thompson has expressed some concern about.
I want to assure him that we are willing to work with anybody to make this a better piece of legislation. The purpose of that committee would be to develop a permanent longterm fix for the broken 1908 compact. We must fulfill our promise made to these communities and the school children back in 1908.
Page 20 PREV PAGE TOP OF DOC I think working together with the folks on both sides of this issue who are sitting behind me and you folks on the committee, we can come up with a solution. I thank you very much. I look forward to answering your questions.
[The prepared statement of Mr. Boyd appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you, Congressman Boyd. Congressman Peterson, we are also very pleased to have you with us.
STATEMENT OF HON. JOHN E. PETERSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF PENNSYLVANIA
Mr. PETERSON of Pennsylvania. Thank you. I would like to thank the chairman and the ranking member for this opportunity and for the committee for spending their time here today to what I think is a very important issue to rural America. I am here to support the legislation.
I live in a large rural district, the largest district east of the Mississippi in the East in northern Pennsylvania, the home of the finest hardwoods in America; the most mature hardwoods in America. The Allegheny National Forest is a part of my district. It is a 550,000 acre forest that may have between 60 and 70 percent of the veneer cherry in the world on it.
So, it is a very vital resource, if you like cherry and many people do. We have not had the cut in payments in our district to schools that you have had in the West. The only reason is we went from 100 million board feet per year cut down to sort of an average of 40. This year, we only had 6. We hope and pray that is an anomaly. We think it is.
We went through some lawsuits and some timber sale holdups because of those lawsuits, but we think we have worked our way through that. We are hoping to get back on track with somewhere around the 40 million to 45 million board feet per year cut, which is still very minimal to what that forest is growing. So, the other thing that has benefitted our area is the value has doubled and tripled every few years.
Page 21 PREV PAGE TOP OF DOC Though we were cutting much less timber, the receipts were not a lot less. In fact, they were not less while they were still growing. A little forest county in my district with less than 5,000 people, gets $750,000 this year for that school. Without that money, it would be an absolute catastrophe in that school district.
They just do not have an economic base. They have lost every major employer in that district in the last 10 years. We have lost several plants that were there. So, this is something that is just absolutely vital. Now, the loss we have had has been in jobs and the availability of high quality timber that normally came out of the Allegheny National Forest.
My district also is probably a million or more acres of State land owned by the Game Commission and the State Forest Service, who are a little better at cutting timber than the Federal Government. I guess the point I would like to make today is that decoupling is a pretty clever ploy, because it would take away from us some of our best voices.
I have found that school superintendents, college presidents, local leaders, when they were forced to study this issue, because of the economic loss, when they looked at this issue, they just said well, why is this happening? This makes no public policy sense. I had a college president who is a biologist. He is pretty environmentally conscious. He said, why is this happening? How does this make sense to not be practicing forestry on our forests?
The answer is there no good reason for that. When you look at the decline, you know we were cutting 12 billion board per year, and I am not going to argue whether that was appropriate or not. We had about 3 billion salvage on top of that. So, we were at 15 billion. Now, we are down to 3 billion. That is an 80 percent reduction, because the 3 billion we are cutting is about half-salvage.
So, we are cutting 80 percent less than we used to on our forests. I guess the other part is that on the Forest Service land, we have 192 million acres. We are only practicing forestry on about 30 million, and I would say very cautiously.
Page 22 PREV PAGE TOP OF DOC Another issue I would like to share with you is that with the 23 billion feet on the Forest Service alone of growth per year, we have 6 billion of forest that is dying from disease and insects. We have 3 billion we are cutting. So, that is a net gain of 14 billion board feet per year.
Now, it may be more than that because some of the timber we are cutting is dead timber. So, we may be cutting a part of that 6 billion, but am using the most conservative figures. Every 7 years, we are inventorying an additional 100 billion board feet of timber in this country.
Now, the softwood issue in the West is even more alarming when you have 50 percent of the softwood supply in this country is on public land. We are only providing 3 percent of the marketplace. We are importing now 34 percent. Are we going to be happy when we reach where we are with oil? That we import more of our softwoods and we put the jobs in other countries.
Now, I would like to come back to what I think is the argument we must not forget. When we manage a forest, and we practice good forestry, foresters in my district have shown me without any doubt that when you manage a forest, you double and triple the growth. When you take out the old and dying trees, you take out the mature trees, you double and triple the growth.
When you remove those logs, you take that carbon out of there also. It is a placement for carbon. Log is carbon. A young growing forest will remove two or three times as much CO2 from the air. An old dying forest can actually become a contributor to CO2. We are concerned about the CO2 problem. You do not hear them talk about that.
The winners on a well-managed forest with where you are practicing good forestry, the first one is the habitat, the wildlife. We had an amendment last night to take money from the Forest cut and put it in habitat and wildlife. Well, you know, the Fish and Wildlife Service and other agencies cannot create habitat. They cannot create critters. I want to tell you, a well-managed forest is full of critters.
Page 23 PREV PAGE TOP OF DOC An old forest with a heavy canopy has a lot of insects and a lot of rodents, but very few critters and birds. It is not a sanctuary for wildlife. It has been interesting to watch in the Allegheny National Forest and in western Pennsylvania in 1985 we had a series of seven tornadoes.
They cut paths at half to a mile wide where it literally at the stump, whether the tree was 3 feet, 5 feet, or 6 inches, it just broke them off. It was the most powerful storm I have ever seen. It totally destroyed our forest. Now, we are fortunate in the east because our hardwood forest from sprouts and seeds comes right back.
Fourteen years later, that forest is 25 to 35 feet high. It is a jungle. It is a mixture of cherry, oak, maple, and all of the other species that we have. It is very vibrant. It is teeming with wildlife; the deer, the critters, the birds. The people who have been observing it live near it. They say it is absolutely teeming with wildlife. That is what we want.
The trout streams are healthy again. The native trout are there. It has healed itself. It was destroyed; not like we want to do with timber. It was destroyed by nature and it has come back. I think it is vital that we do not miss that argument. That good forestry is vital to our wildlife. It is vital to clean air. It certainly is an economic gain. It makes this country self-sufficient in timber issues. I think those arguments must not be forgotten.
[The prepared statement of Mr. Peterson appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you, Congressman Peterson. We have a vote on, but I think we have time to accommodate our other member who has just joined us. Congressman Turner, we are very pleased to have you with us as well.
STATEMENT OF HON. JIM TURNER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS
Page 24 PREV PAGE TOP OF DOC Mr. TURNER. Thank you, Mr. Chairman and Mrs. Clayton. I represent 19 counties in east Texas with about 640,000 acres of National Forestlands. Our experience has been much the same as members of the panel next to me. We had a unique situation develop over a year ago where a group of environmental organizations filed suit and enjoined all logging in our National Forest.
That injunction is still in effect, on appeal in the Fifth Circuit, and is creating a great hardship for our counties and our school districts. I think that it is time to allow our school districts and our counties to be free of the battle that is being waged and has been waged for many years now between those who believe we should not be logging in our National Forests and those who believe that it is sound forest management to conduct logging.
Our school children in our counties who depend upon the 25 percent payment from the proceeds of sale of timber should not be made to suffer because of this ongoing battle. This legislation, and I am proud to be an original cosponsor of with my colleagues here today, would remedy that unfairness.
We believe very firmly that it is important for this committee and this Congress to recognize that the payments that have been received over the years from this agreement with the Federal Government, this law that provides 25 percent of all proceeds to go to our counties and school districts, is in fact a payment in lieu of the taxes that would otherwise be paid if those were not Federal lands.
The hardships that have been created are very, very real. We believe it is important to provide a remedy. We believe this bill provides a good first-step at trying to alleviate those hardships. Thank you, Mr. Chairman.
[The prepared statement of Mr. Turner appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you, Congressman Turner.
Page 25 PREV PAGE TOP OF DOC As noted, we do have a vote on the journal. We would like to invite all four Members to return if they would like to take a few questions from the members of the committee. If you have to move on to other business, we certainly understand that.
We are in considerable sympathy with your testimony, but we do have some questions we would ask you if you come back. If you do not, we will go on to the next panel. Thank you all.
The subcommittee will stand in recess.
Mr. GOODLATTE. The subcommittee will reconvene.
Congressman Deal, would you say that this is consensus legislation? In other words, is it a bipartisan, grassroots approach to resolving a very serious problem rather than a Washington knows best approach?
Mr. DEAL. Yes, Mr. Chairman. I think this is a classic example of bipartisanship, as well as grassroots support for this legislation. As we have indicated in our earlier testimony, the support groups, some of whom I am sure you will probably hear from in later panels, as well as the fact that this has bipartisan cosponsorship within this body. I think that is the way it should be, because you really do not have partisanship in terms of where the National Forests and BLM lands lie. They cross districts represented by both parties. The concerns and interests of local school boards are the same. So, yes, I think it does fit both of those criteria.
Mr. GOODLATTE. Congressman Boyd, would you have any comment on the same?
Mr. BOYD. Well, I think it is evidence by the fact that you had four panelists here today; four of the six cosponsors, sponsors; two from each party. I think as far as consensus, you have educators, county commissioners. You have the National Education Association. You have the U.S. Chamber of Commerce. It is a cross-section. It is a real consensus. It was built up from the bottom.
Page 26 PREV PAGE TOP OF DOC Mr. GOODLATTE. Congressman Deal, what are your feelings about decoupling?
Mr. DEAL. Well, you know, that is an interesting term. Of course, it is all a relative term. Coupling is fine. In the earlier years when this program was started, local communities were coupled to a Mack truck with a full tank of diesel. Now, many of the feel they are coupled to a Chevette with a knocking engine.
So, decoupling in the one instance is certainly very different from decoupling now. The issue I think that we have to keep in mind is that the purpose of the program was to provide a revenue stream to those communities that had lost their revenue base as a result of their territory being incorporated into National Forests.
Two of my counties, for example, one has 64 percent of its land area, and another 63 percent of its land area in the National Forest. So, when you lose that revenue base, and you are put into a program where you are attempting to compensate for that loss, the coupling is very, very vital. So, decoupling I think now is appropriate in light of the changed circumstances which have drastic effects on local communities.
Mr. GOODLATTE. By decoupling, we are referring to is the proposal of some to have no connection between the receipts form the forests and the payment to the local governments.
Mr. DEAL. Yes.
Mr. GOODLATTE. Your proposal would not do that.
Mr. DEAL. Ours does not do that, no. It just uses the same type of formula. It just substitutes the revenue stream for the absence of the revenue generated from the timber sales.
Mr. GOODLATTE. Hopefully, depending on circumstances most, if not all, of the revenue stream would come from the 25 percent payment, which would remain in force.
Page 27 PREV PAGE TOP OF DOC Mr. DEAL. That is correct. My district, like the one that Mr. Turner alluded to in his, has seen that revenue stream severely impacted by injunctions in Federal Court that have stopped the harvesting revenue from coming into the coffers. So, we have not totally decoupled. We have just simply tried to deal with this interim situation.
Mr. GOODLATTE. Mr. Boyd, do you have anything to say about that?
Mr. BOYD. Yes, I would. That is an interesting question. To the administration's credit, they have inflated this idea of decoupling in an attempt to solve this problem, because what we are all trying to do, we all have a common goal. That is to solve the problem that is created by the lack of the revenue stream going into the local school systems and the local governments.
Again, to the administration's credit, they have come up with this idea of decoupling. I think that you have seen today from Mr. Peterson's testimony some of the problems that exist with decoupling. I liken decoupling in another idea, say a legislatively-mandated cutting where this Body would decide which trees are cut.
Those are extreme ideas. Why in this body? So, decoupling is an idea that has been floating not 2 or 3 years, I think, by the administration. It has never gotten anywhere. What we have done, what Mr. Deal and I have done, is come with a middle ground approach that will hopefully get us off first square, and get us at the table negotiating on how we can solve this problem.
Mr. GOODLATTE. I think we had a hearing earlier in the year in which we had testimony from a number of represents of rural counties around the country. We are going to hear shortly from a few more. My understanding of their reservation of decoupling is that they recognize that it is not just the 25 percent payment that is vitally important to their communities.
Page 28 PREV PAGE TOP OF DOC It is that their communities are vitally dependent on the forest itself as their source of income. If you cut off the 25 percent and do not have any incentive for reasonable, responsible timber management on the forests, that all of the other related spinoffs are going to go into decline, and the whole county is going to suffer far more than just the loss of the 25 percent payment.
Mr. BOYD. Mr. Chairman, if I might. You have hit the nail on the head. Two bad things happened when the forest goes into the ownership of the Federal Government. Now, there are a lot of good things that happen, obviously, but there are a couple of negative things that happen as far as the local communities are concerned.
One is the loss of tax revenue and the other is the possible loss of economic activity. It is not just the 25 percent. That money is multiplied many times in the community if it was economic activity in the private sector, but it is not. So, that is a negative for the community. That is something that we really are not addressing here as much as we are the loss of tax revenue.
Mr. GOODLATTE. Well, what your legislation does in addition to maintaining the coupling of the 25 percent with the receipts by the local governments, but you are also creating I think some real incentives for the Forest Service to responsibly manage the forest because they have got to come up with that money from an alternative source.
What we are talking about here is not a handout, but rather a living up to a long-term commitment that allows both sides, the local governments and the Forest Service, to find ways to do that, that do not exist if you simply cut the knot and come up with general revenue funds going to localities that are going to ebb and flow with the flow of politics here in Washington, DC.
As we all know, with the changing demographics of our country, there are more and more representatives from big cities and suburban areas that think the lumber for their deck came from the back lot at Lowe's, or Home Depot, or what have you.
Page 29 PREV PAGE TOP OF DOC Well, my time has expired. Let me recognize the gentle woman from North Carolina.
Mrs. CLAYTON. Again, I want to thank Mr. Deal, Mr. Boyd, and the other cosponsors of the bill, because I think their approach and certainly from their expressed statement, it certainly has been a reasonable one. I have not fully embraced it, but I certainly want to tell you that there are some elements of it that I think make a lot of sense.
I also think there are some elements of the others too. I want to revisit the whole decoupling too. It is a metaphor or analogous of what we did in our farm bill. That decoupling the payments to the production. We are no longer tying to it.
I think, as I understand the history, and I must tell you that I am learning the history of the Forest Service, in that they acquired all of these lands, and they took away what would normally be our taxes at our county level, but at the same time they substitute that with a very productive, supposedly forest.
As its productivity increase, the opportunity to have payments in lieu of taxes were there. But when you had a policy change, or a situation in the forestry changed, and there was a decline in the production and the sales, then that premise of substituting a source of revenue was no longer dependable.
Now, as you began to try to assure that, that revenue is there, help me understand, Representative Deal. You said you will use the last 3 years of the highest?
Mr. DEAL. Yes.
Mrs. CLAYTON. To get your average.
Mr. DEAL. It would be the average of the highest 3 years since 1985.
Mrs. CLAYTON. 1985.
Mr. DEAL. Yes.
Page 30 PREV PAGE TOP OF DOC Mrs. CLAYTON. The administration is doing it since 1998?
Mr. DEAL. No. I believe the administration's proposal uses the 1985 year, but they use 76 percent of the average, but never to exceed 25 percent of the 1998 payment. 1998 is one of the historically low years. So, if you take 25, never to exceed 25 percent of the lowest year, then that does not significantly aid these communities and I do not think adequately addresses the problem.
Mrs. CLAYTON. Could you just contrast what you know that 25/98 would be one of your counties as compared to your average out the three highest?
Mr. DEAL. I probably have those figures that I could dig out and provide to you.
Mrs. CLAYTON. Is it substantial?
Mr. DEAL. It is substantial because what has happened in my area, as alluded to by Mr. Turner in his area, is that almost every time that a timber harvesting contract is attempted to be negotiated, there is automatically a Federal lawsuit filed, and there is a longterm hold placed on it, even if they are ultimately successful in winning the right to go ahead with the harvest. So, it has been a significant impact. I can try to get those statistics for you from my area.
Mrs. CLAYTON. Is that the reason you are going to decoupling because of the vulnerability of the legal challenge of a sale?
Mr. DEAL. Well, no, not really. We are not really going to decoupling. I think total decoupling would have the adverse affects that we have seen. That is that there would be no incentive on the Forest Service to fulfill that obligation of managing the forest to include harvesting. The spinoffs that have been alluded to are very, very real.
In areas of North Georgia where the land had previously been privately-owned, it was harvested in a routine fashion. The promise was that, that would continue under the ownership and control of the Federal Government. So, if there is a total decoupling, there is no incentive on the Forest Service to do that; therefore, the loss of that spinoff affect in the local economy; saw mills, those who work in the timber harvesting business, those who work in the processing of that lumber.
Page 31 PREV PAGE TOP OF DOC So, the spinoff effect is a significant effect in the private community. So, total decoupling I think would be a serious mistake because you would lose not just that perhaps revenue from the harvesting, but you would also lose the spinoff effect in the local economy as well.
Mrs. CLAYTON. Now, where would your monies come from though?
Mr. DEAL. It would come from the allocated monies to the Forest Service, from within their budget. Now, they would presumably continue to have that revenue stream from the harvesting of the timber that would supply, and perhaps sometimes all of it, but maybe not always all of it.
I believe the estimate of the cost is some $200 million under the current estimate. Out of a $3.4 billion budget, I am told that is about 5.8 percent of their budget, which is not a significant amount.
Mrs. CLAYTON. Mr. Boyd, would you comment to that as well?
Mr. BOYD. I think Mr. Deal has hit the nail on the head. If you will look at the chart, you will see the piece of legislation that we are discussing today.
It takes an average of the 3 highest years, from 1985 to the current time. In the Apalachicola, it would be 1985, it looks like 1987, and maybe 1989. I think the decoupling legislation says that it will be 76 percent of an average of some years. I do not know what those are, but it cannot be less than 25 percent, less than 1998.
If you go to that, it could be less than 25 percent of 1998 which is about 10 percent or 12 percent of what that average under our piece of legislation would be. So, what you get is about 7 or 8 percent under decoupling for this particular school system, as opposed to what you would get with our proposal. They are just not comparable. It is like comparing apples and oranges. Plus, the problems that he has talked about with decoupling where the economic multiplier effect is no longer there.
Page 32 PREV PAGE TOP OF DOC Mrs. CLAYTON. I thought also Mr. Peterson gave another reason why it was important. It was the ecological interdependence and vibrancy of the forestry also related to good management in that area.
Mr. BOYD. You see, I have always felt that these ideas about ecological management, wildlife management, the effects of your water system and all, are not in contradiction with good forest management practices. I feel like Mr. Peterson. This is what puzzled me about this debate for years. It is that we cannot all come together and we solve all of the problems with a reasonable management plan.
Mr. GOODLATTE. The gentleman from Illinois.
Mr. PHELPS. No, Mr. Chairman.
Mr. GOODLATTE. The gentleman from California.
Mr. THOMPSON. Thank you, Mr. Chairman.
I would like to thank Mr. Deal and Mr. Boyd for coming back over. I had mentioned in my opening remarks that I had some concerns with one specific portion of the bill. I was hoping you could address that issue. I think it is in section 7 regarding the longterm management of forestry resources. The bill says something to the effect that the Advisory Committee should work with a goal in mind of maximizing revenues.
My question is in emphasizing revenues, and please do not mistake this for me being unconcerned with the revenues, because I think that is why the bill is here and that is why we are all here, but how do we guarantee that those environmental protections come about with regard to Forest Service land?
This is something I see as very much a potential problem. It is going to be a point of criticism that we are going to, in search of ever-diminishing revenues, that we are going to neglect all of our effort with regard to the environment. That could cause some serious problems for what it is that we are trying to do and that is create a stable source of funding for schools and local governments.
Page 33 PREV PAGE TOP OF DOC Mr. DEAL. There are many balancing effects in any of this, as you are aware. We have already alluded to the fact that most of these are challenged in court right now. So, therefore that becomes the primary balancing element. Some of us feel that those decisions maybe do not reach a balance in the longterm.
I think the language here under that subsection 2(a) of section 7 is designed to simply say that it is the intention to keep the coupling in place, so that it does not simply become a carve-out of a normal budget of the Forest Service. That is the intention I think that is intended to be expressed. I can see your concern that it may be interpreted from another perspective that we are insisting on maximum harvest. I do not interpret it that way. We will be glad to work with you, if we can come up with some language to address that concern.
Mr. THOMPSON. Thank you, because I think that is going to be important. That is my concern with the idea of decoupling. If you do decouple, my sense is that sometime, maybe not in this Congress, or the next one, or the one after that, but at some point, it is going to look like just another line item.
When money is tight, rural areas, as is always the case, will take the hit. There will be some sort of selective amnesia as to how we got to where we are in funding these critical services. The other question I have is that, that same section requires equal consideration be given to ecological, economic, and social factors in managing the land.
I would just like to know what it is you had in mind to ensure that the Advisory Committee could give equal consideration to all of those factors? Is there some mechanism to ensure that, that happens?
Mr. BOYD. I was going to refer you, Mr. Thompson, to paragraph B in which we say, we ensure that the method is in accord with the definition of sustainable forest management, in which ecological, economic, and the other factors were taken into consideration. It is not just to maximize on the return. It is sustainable forest management with one of the goals being ecological.
Page 34 PREV PAGE TOP OF DOC The other thing that I would want to say to you is that whatever recommendations that committee comes up with, we will have to bring back to this Congress. So, it is not like we are giving this committee carte blanche authority to go change some rules someplace.
What we are doing is trying to stop the bleeding currently, the short-term, and establish a committee which will come with a recommendation to solve this problem longterm, whatever it is, bring it back to this Congress so we can adopt it.
Mr. THOMPSON. It would give me greater comfort if there was some way, and I do not know if we can do it, but there was some provision put in that would figure out how we ''ensure equal consideration,'' or at least set out parameters to help focus the committee in that regard. The idea of it just coming back to Congress does not give me great comfort.
We saw last night where some two amendments on resource issues were so polarized, and me being from a resource-driven area, I did not recognize them. We had one that took money away from a very critical need in order to shift it to another very critical need, which sounded good politically for some, but from a policy perspective or a fiscal perspective made no sense.
We had a gravel or a mining amendment yesterday that was some of the worst public policy I had ever seen, but politically it is pretty hard to vote against that, and it passed overwhelmingly. So, I would rather see some safeguards in the bill.
Mr. DEAL. I might add, I think there is an additional safeguard that is already in the current law. That is that most of these decisions that are being challenged in court are in large part being determined by the existing forest plan that is in place.
In my part of the world, they are in the process of updating that plan and a new one will come out. In the mechanics of developing that Forest Service Plan, all of the considerations, especially the ecological and the environmental considerations are a prime factor in it.
Page 35 PREV PAGE TOP OF DOC Usually, my understanding is that when the courts are asked to rule, the Forest Service Plan becomes the blueprint against which the practice of harvesting is laid over. If it is in conflict, then the Forest Service cannot sustain their position of harvesting. So, in this ongoing process, which is taking place right now in my part of the world, the Forest Service is required, through public input, through suggestions from the general community, and specific interest groups as well, to develop that plan. So, I think that is an additional safeguard that is already in the law.
Mr. BOYD. Mr. Chairman, if I might.
Mr. GOODLATTE. Yes.
Mr. BOYD. I want to remind the committee that the National Forests are, give or take, it depends upon whose figures you use, a $260 billion resource or asset that is in the control of the Federal Government that used to be in the control of the private sector. It returned taxes and other economic activity back to the private sector.
It was taken out of the private sector, and in exchange said we are going to pay you PILT and 25 percent payments; $260 billion. This bill will cost $200 billion. That is less than one-tenth of 1 percent of the value of that national resource that we have taken out of the private sector and have broken the compact that we made when we took it out of the private sector.
So, I just want to remind the committee, that is how urgent this problem is to some of our local communities. Thank you.
Mr. GOODLATTE. I would like to second what the gentleman from Georgia said about allaying the concerns of the gentleman from California. We will continue to look at this and discuss it with you. Maximizing results must come within the parameters of sustainable forest management, which ecological, economic, and social considerations are given balanced treatment.
Page 36 PREV PAGE TOP OF DOC That is the definition, the internationally accepted definition, for sustainable forestry. We certainly want to make sure that is what this bill contemplates. The gentleman from Virginia.
Mr. GOODE. I was reading what Secretary Glickman wrote about the Stabilization Act. He said that OMB stated that it would increase in direct spending $27 million in fiscal year 2000, if adopted this year, and $259 million in 2001, 2002, 2003, and 2004. I heard you, Mr. Boyd, say $200 million for yours. What is your estimate on the Deal-Boyd proposal would cost in 2001, 2002; just ballpark?
Mr. BOYD. I do not think that it has been scored, but $200 million is the estimated figure. Of course, a lot of that would depend upon
Mr. GOODE. Is that per year?
Mr. BOYD. That is annual. Again, that would depend upon what sort of revenue return came through the 25 Percent Program. Just remember that we would use what current revenues were generated in that year by that program. If they fell short of the 3-year average, then you would use other sources to build it up to the 3-year average.
Mr. GOODE. So, it would depend upon what amount of revenue was generated through the 25 Percent Program.
Mr. BOYD. But that is not going to be a whole lot, unless you have a different attitude about cutting.
Well, historically, you see the chart in front of you. You can see what is happening.
Mrs. CLAYTON. Would the gentleman yield?
Mr. GOODE. Yes.
Mrs. CLAYTON. I was thinking that his question was making, too, a comparison between what was in Secretary Glickman's annual proposal, and I gather his proposal in the letter was based on the 25 percent. Mr. Boyd, do I understand that what you are saying is that whatever that is, you will use that first. If it came below the 3-year average, then you will get the funds from somewhere else?
Page 37 PREV PAGE TOP OF DOC Mr. BOYD. That is correct.
Mrs. CLAYTON. That is what you were saying.
Mr. GOODE. I do not anticipate that bringing in that much. What do you think it would do? If it did like it did the last 2 years, what do you think it would do?
Mr. BOYD. Well, in Liberty County in 1998, I think their payment was $220,000, and the 3-year average would be in the neighborhood of $1.5 million to $1.2 million, but I do not know how that translates nationwide. We estimate $200,000. Again, it depends upon what sort of county.
Mr. GOODE. $200 million.
Mr. BOYD. $200 million, yes.
Mr. GOODE. That is all.
Mr. GOODLATTE. If the gentleman would yield on that point. I think it is important to note that this legislation contemplates all revenues coming to the Forest Service, not just from timber harvesting. So, for example, grazing fees, recreation; correct?
Mr. BOYD. Yes.
Mr. GOODLATTE. And other similar uses. When the Forest Service says that recreation is the future, then hopefully they will be optimistic that this revenue will contribute substantially to the payments to the counties. That is a part of the feature.
The other thing is that this legislation says that if they do not meet the target, then they have got to come up with the additional amounts out of their own resources. It puts a lot of pressure on the Forest Service to responsibly manage the forests and generate some revenues for the local governments, because otherwise they are not going to have the resources for other areas.
Page 38 PREV PAGE TOP OF DOC I think the important point to be made there is that if there is a declining use of the forests for timber harvesting, for example, maybe they do not need some of those other revenues, and there they are available to fund this plan. It does not decouple it. It keeps the Forest Service and the local community very much tied together. That is what I think is the heart of what the gentleman's legislation does.
The gentleman from Oregon.
Mr. WALDEN. Thank you, Mr. Chairman.
I would like to followup on what you have just said, because I think that is absolutely important. I do not support the decoupling effort. I think our communities lose and I think our forests lose as well. I want to comment both Mr. Deal and Mr. Boyd for their presentations, their testimony, even though I was not here to hear it verbally. I have seen it.
I think the point that is made, and I certainly hear from Representatives from my own local governments is that we can have an effective partnership for health forests, healthy communities, and healthy schools, if we manage the forests properly. We can return the revenues that we used to return.
We can keep the commitment that dates back to the early 1900's between the Federal Government, the counties, and the people who live there. So, I appreciate what you have had to say. I guess I would leave it at that at this point, Mr. Chairman. I want to hear the other witnesses as well.
Mr. GOODLATTE. Thank you. If there are no further questions, I want to thank this panel. You have been very helpful. We appreciate very much your introducing this legislation, because I think it is heading us in exactly the right direction to rebuilding that connection between communities, and an important resource for them, the National Forests, that surround their communities. Thank you again.
I will invite our second panel to the table. The Honorable James Lyons, Under Secretary, Natural Resources and Environment of the U.S. Department of Agriculture; Mr. Robert Douglas, Tehama County superintendent of schools, Red Bluff, CA and president of the National Forest Counties and Schools Coalition; Ms. Claire Collins, county administrator, Bath County, Warm Springs, VA; Mr. Mark Evans, Trinity County judge, Groveton, TX; Mr. Glen Spain, northwest regional director, Pacific Coast Federation of Fishermen's Associations, Eugene, OR; and Dr. Walt Hanline, superintendent, Del Norte County Unified School District, Crescent City, CA.
Page 39 PREV PAGE TOP OF DOC I would like to welcome all of the members of this panel. Beginning with Under Secretary Lyons, I advise all of you that your written statement is made a part of the record, and we welcome your oral testimony.
Mr. Lyons, welcome.
STATEMENT OF JAMES R. LYONS, UNDER SECRETARY, NATURAL RESOURCES AND ENVIRONMENT, U.S. DEPARTMENT OF AGRICULTURE
Mr. LYONS. Thank you very much, Mr. Chairman.
It is good to come back to the committee where I spent so many years as a member of the staff on the dais. It is always more interesting to be on this side, I have come to see. I appreciate the opportunity to visit with you today, and with Mrs. Clayton, as well as the other members of this subcommittee.
I have a number of things I want to cover, and I will try to do that as quickly as possible. First off, I want to just thank you again publicly for your work, Mr. Walden's work, and the other members who were on the floor last night helping to defend the Forest Service budget, and help ensure we have the resources to practice the good stewardship that we are working to do on our American landscape.
We really do appreciate the long night that you put in, in working in defense of our effort. So, thank you very much for your leadership. I want to, first of all, thank you of course for the opportunity to testify on H.R. 2389.
I want to commend the members who have spoken for their initiative and their efforts to try and address a clear problem, and that is declining payments for county services and schools.
Also, I have the opportunity to discuss with you today the administration's proposal, the Stabilization Act of 1999. I am joined today by a number of members of the Forest Service staff. Key to my support here is Ms. Sandra Key who is the Associate Deputy Chief for Programs and Legislation for the Forest Service, who can probably provide you background on the technical issues related to the discussion we will have today.
Page 40 PREV PAGE TOP OF DOC I will also take the liberty of briefly addressing Mr. DeFazio's proposal in the context of my remarks. Mr. Chairman, if I could, I would like to have staff put up a chart that I think summarizes the issue that we are discussing, and that is the chart that depicts the changes in the 25 percent payments over time.
I do this simply to point out that I do not want to challenge any of the figures discussed, nor debate any of the numbers that have already been raised. I simply want to point out that we differ in the administration in the solution we seek for dealing with this very difficult issue.
In fact, I would suggest that the findings in the bill that was introduced by Mr. Boyd do a good job of highlighting how great a challenge we face. The decline in shared revenues has severely impacted or crippled educational finding in and the quality of education provided by the affected counties. The administration has attempted to address this issue in last year's budget proposal and again this year in proposing to decouple payments to counties from the Timber Sale Program. The proposal, we believe, will do the following.
First of all, it will provide stable, predictable payments that counties can depend on to help fund education and the maintenance of roads.
Second, it provide increased payments above the payments projected under current law to compensate States for National Forestlands that are not available to the local tax base.
Third, it would provide a mandatory permanent payment not subject to the annual appropriations process. As we saw last night, sometimes that is a rather dicey process on the Floor.
Four, it would sever the connection between timber sales and critically important local services.
Now, over the last 10 years, Mr. Chairman, timber harvests from the National Forests have declined. In fact, they have declined significantly; by 70 percent in response to a number of factors, new scientific information, changing public values with regard to the use of our National Forests, our evolving understanding of how to manage sustainable ecosystems.
Page 41 PREV PAGE TOP OF DOC During that same period of time, payments to States made under the 25 payment formula have been reduced by 36 percent from $361 million in 1989, to $228 million in 1998. Again, I would like to quickly throw up a chart that illustrates what has happened.
First of all, with regard to the volume harvested, you can see that there has been a significant change. This is actually over the past two decades. I think it illustrates the point that there have been fluctuations in harvests, but clearly there is a downward trend.
Then if you look at the issues associated with timber values, you can see there has been quite significant swings in the values associated with timber harvested from the National Forests.
Despite the fact that we had harvests in the early 1980, you can see there was a rather dramatic decline in the value of timber that was produced. Values increased over time and now have continued to decline with declining harvests. The point I want to make is that the volume harvested can differ dramatically from the values. Here, we are focused on values because we are talking about 25 percent of the revenue generated from these sales.
Under the Department's proposal, States would receive the higher of the 1998 fiscal year payment or a new special payment amount. The special payment amount would be 76 percent of the average three higher payments made to the State during the 10-year period from fiscal years 1986 through 1995.
The special payment amount will not exceed the 1998 fiscal year payment by more than 25 percent. The special payment amount will pay the States, we figure, approximately $269 million annually. The special payment effect is modeled on the formula that was used in what we refer to the Owl County safetynet, which was adopted by the Congress in 1990.
You asked the question, Mr. Chairman, if we were talking about a Washington, DC, inside the beltway solution or a county-based solution? In fact, the counties came to us in the Congress in 1990 and asked for this assistance simply because they had seen precipitous declines in their timber sales over time.
Page 42 PREV PAGE TOP OF DOC So, it was largely Oregon and Washington Counties in 1990 who raised this issue, that lead to legislative action, which was then amended in 1993 to extend the payments for 10 years and also to include counties in northern California. We chose the 76 percent of the historic baseline in the proposal the administration has put forward, because that was the level of the owl county safety-net payment guarantee when the administration first proposed to stabilize payments over a year and a half ago. I have emphasized the fact that commodity extraction from our National Forests has been reduced.
We think our proposal ensures the States continue to benefit, both from the intrinsic and economic value of public lands by guaranteeing a payment to make planning and budgeting predictable for the counties. That is why we propose the States receive a permanent, stable, annual payment based on a percentage of historic payment averages, not based on annual appropriations.
The payment needs to be excluded from the annual appropriations process for the reasons I have just mentioned. This mandatory permanent payment formula in fact can work, and I think we have illustrated that with the owl county safety-net payments.
We believe it is important to make a distinction and separate the social and moral imperatives of children's education, which is really what these payments are about, from the issues associated with timber harvest and future management of the National Forests.
We know there has been resistance, and there has been a great deal of discussion within the first panel with regard to whether or not decoupling should be promoted. Frankly, Mr. Chairman, I think it is wrong to balance the future of our children's education on the likelihood of timber sales in the long-run, because I think history would demonstrate that is an uncertain future.
In fact, in many respects we put the counties in the position of having to survive this roller coaster of changes in values from timber harvests off the National Forests. As Mr. Boyd pointed out to me when we spoke before the hearing, he said, hell, that is not a roller coaster. They are at the very bottom. Roller coasters go up and down.
Page 43 PREV PAGE TOP OF DOC We are at the bottom now. We do not anticipate that the revenues will increase dramatically over time. I would point out that even if timber harvests were likely to increase, I do not expect that the values would increase dramatically, and there is a reason for that.
The reason is because we have changed our program to respond to many of the issues that have been raised by the Congress. In fact, I was in Congressman Walden's district just a few weeks ago in which we looked at the forest health concerns that have been raised.
If Tom will put up the Forest Health Map, which I think was put up many times on the floor of the House last night. We all acknowledge that there is a forest health crisis that we need to address in many parts of the United States. We are working to attempt to address that.
In fact, just a few weeks ago we announced, along with the Governor of Oregon, a $2 million pilot project to begin to focus in on ecosystem restoration and forest health concerns. What happens when we do this is you will see a dramatic change in the nature of our Timber Sale Program.
I do not have a large chart to demonstrate this, Mr. Chairman, but I hope you can see from this pie chart that at the top in 1989, a large percentage of our Timber Sale Program, in green, was green timber sales, which was harvesting old growth in green volume.
We have made a dramatic shift in our program. I will let Dave bring this up to you, but putting more and more focus on salvage sales, and thinning sales, and the kinds of sales that are necessary to address this forest health concern. As a result of that, even if we increase the amount of volume that we harvested over time, we would not get nearly as much value per acre.
That would not I think be sufficient to address the concerns the counties have, certainly not to bring them back to the years when they were realizing significant revenues from 40-acre clear cuts of old growth, because we are not in that business anymore. There is another reason we are not in that business. That is because the business of forest management and of home building has changed and shifted as the industry has attempted to make more efficient use of the forest products that come off our National Forests. I just happened to see this, this morning.
Page 44 PREV PAGE TOP OF DOC This is Sunset Magazine from July. The centerfold of this actually is an add for, ''Trust Joist Floor Joist'' which is a recycled product. They are made not from the traditional green cut, 2 by 10s that you would normally see in flooring, but rather they are a product of lamination and basically a more efficient use of the kinds of materials that we are now producing.
My point in raising this, Mr. Chairman, is that the world is changing. The industry has changed. Home building has changed. We are on an historic high in terms of new home building, yet the demand for timber from the National Forests is declining. We are attempting to make adjustments to be more responsive to address the forest health concerns that are raised.
We do not want to find ourselves in the position, once again, of having to prepare a Timber Sale Program to respond to one imperatave, but rather to manage the resources to respond to the broader needs and management objectives that I think we all share.
Let me comment then on H.R. 2389. The Department agrees with one of the objectives of H.R. 2389 and that is to stabilize payments. However, we strongly oppose the bill. I must tell you if enrolled as introduced, the Secretary would recommend to the President that it be vetoed for the following reasons.
First, it does not provide a stable payment past 5 years, nor does it provide for a mandatory payment to States from the general fund of the Treasury.
Second, the funding provisions for fiscal year 2000 to 2005 payments could create significant impacts on Forest Service Programs. By our estimates, over 5 years the impact on our general appropriations could be as high as $1 billion. That would have a devastating effect on our ability to do this kind of resource management work.
Third, the bill does not separate payments to States from the contentious, and obviously controversial debate over natural resource management on our National Forests. In fact, it fuels that debate. I fear it puts school children in the position of being pawns in this larger debate over what the future management of the National Forests would be.
Page 45 PREV PAGE TOP OF DOC We also object to the provisions that would establish a commission to look at issues associated with how to resolve this issue in the long-run. In establishing that Advisory Committee, charged with developing recommendations for a long-term method for generating payments at or above the full payment level, we believe that this committee in fact would provide new direction and new policy which is totally inconsistent with 30 years of history and policy established by the Congress in current and previous administrations.
That is because the Advisory Committee would be required to ''seek to maximize the amount of revenues collected from Federal lands.'' Now, the concept of maximizing revenues collected from the National Forests is a fundamental change in policy and direction.
In fact, inconsistent with what I consider one of our basic and foundation statutes in the Multiple Use Sustain Yield Act. If I could just briefly read from the definition of multiple use in this act which was passed in 1960, it states
Multiple use means that some land will be used for less than all of the resources, and harmonious and coordinated management of the various resources, each with the other, without impairment of the productivity of the land, with consideration being given to the relative values of the various resources, and not necessarily to the combination of uses that will give the greatest dollar return or the greatest unit output.
Mr. Chairman, I share the concern of the members who introduced this legislation. Obviously, the administration has been concerned about this issue for some time. That is why last year and again this year, we introduced a proposal to address these concerns.
We believe, contrary to what has been alleged, that decoupling is not a ploy. To the contrary, it is a plea. It is a plea to get out of this insanity of tying payments for our children's education to the roller coaster ride that is the Federal Timber Sale Program.
Page 46 PREV PAGE TOP OF DOC It is a plea to get away from forcing forest managers to have to make decisions with regard the ways they are going to address issues like forest health, based first and foremost on whether or not they are going to generate sufficient revenues to meet some predetermined target. That is not the way to be stewards of the National Forests.
It is certainly not the way we want to manage those lands in perpetuity. You also asked, Mr. Chairman, about grassroots support for
Mr. GOODLATTE. Mr. Lyons, we have gone well beyond the 5 minutes; if you could summarize.
Mr. LYONS. I will do that. I will summarize by saying that in response to your initial question, Mr. Chairman, about support from the grassroots for this proposal, I have a series of letters, that I will not go through, that illustrate that support.
They come from a diverse group of counties: Bland County, ID; Benton County, OR; Pitkin County, CO; Coconino County, AZ; Baker County, FL; Missoula County, MT; and Humboldt County, CA.
I would just read one sentence from the letter from Humboldt County that I think best summarizes what we seek to achieve. The County Board of Supervisors' chairman states, ''We have no desire to return to the boom and bust cycle of dependency on timber harvest and are grateful that the safetynet is currently in place for owl counties such as ours.''
We think we have a track record, Mr. Chairman, of meeting the needs of the counties with stable payments. We believe the formula that we have proposed is an effective one and we can demonstrate that. But most importantly, Mr. Chairman, I think we all agree that there is a problem we need to address.
I am here to tell you that we are anxious to work with you and the other members of the committee to try and find a solution to this very, very difficult problem. Thank you.
Page 47 PREV PAGE TOP OF DOC [The prepared statement of Mr. Lyons appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Those letters are from individuals, not from the county governments; is that correct?
Mr. LYONS. No. These are from county commissioners.
Mr. GOODLATTE. Individual commissioners or is it a vote of the counties?
Mr. LYONS. It is a mix of county commissioners and the chairs of county commissions. I will be glad to provide them for you.
Mr. GOODLATTE. Submit those. We would be happy to have those. Mr. Douglas, we welcome you.
STATEMENT OF ROBERT E. DOUGLAS, PRESIDENT, NATIONAL FOREST COUNTIES AND SCHOOLS COALITION
Mr. DOUGLAS. Thank you, Mr. Chairman.
My name is Bob Douglas. I am the elected county superintendent of schools for Tehama County in Red Bluff, CA. Prior to becoming a county superintendent, I was for 17 years a school administrator in the Plumas Unified School District, home of the Quincy Library Group. I am familiar with the work of that group.
I am here today to represent the National Forests Counties and Schools Coalition which, as you know, is a growing organization of 500-plus organizations, representing now 35 States. Mr. Chairman, I would like to enter into the record a list of those organizations and letters of support from a number of the organizations, including the National Education Association, the American Association of School Administrators, the U.S. Chamber of Commerce, etc., if I may.
Mr. GOODLATTE. Without objection.
Page 48 PREV PAGE TOP OF DOC [The letters referred to are on file with the committee.]
Mr. DOUGLAS. This organization has grown rapidly because the counties, the 800 of them out there, save a few that you have heard differently from, are having a common negative experience. They are experiencing economic travail, deteriorating social conditions, and a lowered standard of living for their families.
They are suffering deep and devastating cuts in school and county programs and services. The size of the problem is significant. In our 730 non-owl protected counties, the decline instead of looking like 36 percent has more closely approximated an average of 65 percent in decline.
Also, in many of those counties it has approached, as Congressman Boyd pointed out this morning, 89 or 90 percent. The 25 percent cap in the President's proposal simply does not help those counties. This decline that we are experiencing right now is different than other declines that we have experienced.
We have had recessions. The early 1980's was a recession. We are experiencing in America an era of unprecedented national prosperity. The forest counties of America are not enjoying that euphoria. Instead, our unemployment rates, poverty levels, economic instabilities, and social deteriorations are above State and National averages. We have had a decade-long decline. It is the product of laws, and administrative regulations, and litigation which has nearly eliminated economic activity on Federal lands. Unlike our urban and suburban counterparts, our limited private land base leaves us with very limited options. Mrs. Clayton pointed that out in her opening remarks.
The purposes of H.R. 2389, which is substantially based upon the principles adopted by our coalition in March of 1999, is first a 5-year temporary payment safety-net which is very drastically needed to provide protection and an infrastructure in these counties.
Page 49 PREV PAGE TOP OF DOC The second piece, and one which tends to be a bit more controversial it would appear, is a mechanism or a vehicle to develop a long-term solution. That mechanism that we proposed and we believe makes good sense is a congressionally-appointed committee representative of the Federal and local government stakeholders in this long-term partnership that we have had with the United States Forest Service and the U.S. forest system.
We have asked that committee in the legislation to formulate recommendations for policy and legislation. It is important I think to note that the long-term solution that we suggest in here is not pre-supposed. We have not tried to dictate in the legislation a specific solution, but instead we have tried to provide a mechanism for that conversation. The guidance in the bill asks for us to consider the historic relationship regarding Federal revenue production, and county and school support. The term maximize, means maximize in the context of sustainable forest management.
We are not asking to maximize revenue at the expense of the National Forests. That is not the position of our coalition. I would reiterate that this is a vehicle, and it does not demand a preconceived solution. We believe, however, that a focused national conversation within a 5-year timetable leading to the development of congressional recommendations, and we hope legislation, is drastically needed in our country.
In response to the critics of the mechanism, we would assert that the intent of this mechanism is to find the middle ground and to build consensus around the issue of forest management, economic development of communities, and supporting families and public schools. We believe that those are not mutually exclusive goals.
The long-term portion of the bill provides for the development of a sustained systemic solution to a clearly systemic problem. We strongly believe that the current laws should remain in tact. We believe that payments to county schools without an improvement in community economic self-determination and improved family standards of living will not work. Likewise, we believe that payments without active management of the dominant economic asset in forest communities, the forestland itself, will not work. We are dealing with complex economic, ecological, and social systems, and a sustainable long-term solution must congruently strike a balance between those three factors.
Page 50 PREV PAGE TOP OF DOC We believe that H.R. 2389 achieves the goal of meeting the needs of our counties, the immediate needs of our counties, and schools. It moves us pro-actively toward crafting a long-term solution, without prejudicing the final outcome of that solution. We would urge your support of H.R. 2389. Thank you.
[The prepared statement of Mr. Douglas appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you, Mr. Douglas.
Ms. Collins, you and I have the privilege of representing one of the most beautiful counties in the world, Bath County, VA. We are delighted to have you with us today.
STATEMENT OF CLAIRE A. COLLINS, COUNTY ADMINISTRATOR, BATH COUNTY, WARM SPRINGS, VA
Ms. COLLINS. Thank you. I am pleased to be here.
My name is Claire Collins. I serve as county administrator of Bath County, VA which, for those of you who do not know, is located in the central western portion of the Commonwealth of Virginia, commonly known as the Allegheny Highlands Region. It borders Virginia and West Virginia.
In Bath County, we have a population, according to the U.S. Census of 1990, of 4,799 residents and 540 square miles of land mass in which the George Washington-Jefferson National Forest is 52 percent of that land mass. On behalf of Bath County, who is a member of the National Forest Counties and School Coalition, I am going to comment today on the merits of both H.R. 2389 and the administration's proposal.
Historically, rural counties such as Bath have and continue to fund education as their top priority. This gives young citizens the tools necessary to compete in a global market, and also what all of us strive for and that is the ''American Dream.''
In 1908 when Congress enacted the legislation providing 25 percent revenues from National Forests to be paid to counties in which forestlands existed to be spent on public schools and roads, rural counties were able to utilize that revenue. I notice today I do not see a chart going back to 1908 to show us what those revenue streams were. I would like to see that.
Page 51 PREV PAGE TOP OF DOC In recent years, the principal source of these revenues, the Federal Timber Sales, has declined by over 70 percent nationwide. In Bath County, for example, as of year-ended June 30, we received $133,310.66 of these revenues for public schools, with school operational expenditures, as of June 30, of $7,471,355.76. Yes, education is our top priority.
This makes the forest revenues only account for 1.8 percent of the schools' operational budget. That is a travesty. That means we are not getting much money from the Federal Government. Plus, local citizens in Bath County and other counties throughout the United States, with Federal forestlands, are bearing the tax burden to fund public schools.
This is an unfortunate situation because if a county, such as Bath or other counties, does not have adequate revenues to fund education, then our young citizens are missing out on learning opportunities and job preparation. H.R. 2389 is the first step in bridging this education gap by providing assistance to rural counties across the Nation to ensure that the 1908 legislation is followed with appropriate revenues sent to counties.
Establishing a temporary 5-year payment formula for counties receiving revenue sharing payments from Forest Service and Bureau of Land Management lands, with full payment amounts to each eligible State or county, based on the averages of three highest annual payments received between fiscal year 1985 and the date of this bill's enactment, would greatly improve all of the counties' revenues.
Also, developing the long-term solution to the current revenue sharing program with the formation of a Forest Counties Payment Committee, charged with developing policy and/or legislative recommendations to Congress within 2 years, would provide for the collaborative and partnership efforts needed in rural communities to increase revenues, promote the economy, and ensure sustainable forest management.
The proposal offered by the administration suggests a permanent annual appropriation to States and counties from the Treasury that amounts to 76 percent of the average of the 3 highest years since 1985, that will not exceed an increase of 25 percent of the 1998 receipt levels.
Page 52 PREV PAGE TOP OF DOC Unfortunately, the chart you were presented does not show the 198588 years. That is a shame that, that was not shown on the chart. The administration's proposal also stresses the philosophy of administration officials, that payments to counties and schools should be removed from the debate about management of Federal forestlands.
This proposal fails to address the need for short and long-term solutions to decreasing revenues to counties with forestlands, or for administration officials to work in partnership with counties toward the goal of economic stability and enhancement.
Rural counties with forestlands have witnessed, in recent years, the demise of administration officials' involvement in community problem solving and know that payment mechanisms, such as payment in lieu of taxes, PILT, have been inadequately funded over the years. In Bath County, the Board of Supervisors continues to make increasing PILT a Federal legislative priority, and appeals Forest Service decisions on timber sales and trail relocations.
Instead of the administration working with rural counties, there seems to be a belief that rural counties accept whatever the administration states or proposes. There is a dire need to engage in collaborative and problem solving efforts for the economic and social stability, and enhancement of rural schools and counties.
In closing, it is clear that H.R. 2389 restores stability to 25 percent payments for an interim 5-year period, along with a mechanism for a long-term solution to reaffirm the 1908 legislation. Also, it is clear that the administration's proposal fails to provide for an equitable and collaborative solution.
No incentives exist in the administration's proposal to ensure that actively managed Federal forestlands will revitalize and restore the economic and social stability of rural counties. In closing, I also want to state that rural communities do not change like other counties and communities throughout this country.
We still have to provide the services that the citizens want. They want the same kinds of services that are in urban areas, though they are at a lesser scale. Also, we have not been privileged to the safety-net that other counties have been privileged with, with the legislation that Mr. Lyons referred to.
Page 53 PREV PAGE TOP OF DOC The formula that he is proposing provides less than the average that we have seen, not only since 1985, but probably since 1908. I will just close with those remarks. Thank you.
[The prepared statement of Ms. Collins appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you, Ms. Collins.
Mr. Evans, we are pleased to have your testimony.
STATEMENT OF MARK EVANS, TRINITY COUNTY JUDGE, GROVETON, TX
Mr. EVANS. Thank you, Mr. Chairman.
My name is Mark Evans. I am the county judge of Trinity County, TX. With me today is Judge Chris von Doenhoff, the Houston County judge, who testified at a previous hearing. I would like to start, Mr. Chairman, by thanking you and the ranking member for this hearing.
I would also like to thank Congressmen Deal and Boyd for sponsoring H.R. 2389, and my Congressman, Jim Turner, for being a cosponsor as well. I would also like to especially thank Congressman Stenholm. I know he is not here but for listening to two east Texas county judges for about 30 minutes the last time we were here, to talk about pine timber. Of course, Congressman Stenholm's district I do not believe is graced with an awful lot of trees.
I also serve as president of the North and East Texas County Judges and Commissioner's Association, which has 66 member counties. At our recent annual conference, the North and East Texas Association passed a resolution in full support of the principles of responsible management of our National Forests adopted by the National Forest Counties and Schools Coalition. Mr. Chairman, I would request that a copy of this resolution be entered into the record as a part of my testimony.
Page 54 PREV PAGE TOP OF DOC Mr. GOODLATTE. Without objection, so ordered.
[The resolution appears at the conclusion of the hearing.]
Mr. EVANS. Thank you. Trinity County is located in the eastern part of Texas, and contributes over 67,000 acres of land to the Davy Crockett National Forest. This acreage is some of the best for the production of pine timber anywhere. As a part of the Davy Crockett National Forest, this acreage is not on the tax rolls, nor is it available for development.
For decades, there has existed a compact between the U.S. Forest Service and the counties and school districts; 25 percent of the revenues from the harvested timber on National Forest land in each county has been returned to the counties to be shared with the local school districts.
This 25 percent is divided equally between the counties and local schools. The county's share is used exclusively for road and bridge operations, and in the past has made up about 40 percent of Trinity County's road and bridge budget. In the last 3 years, Trinity County's 25 percent share of the National Forest receipts have declined from $1,033,381 in 1996, to $90,409 in 1998.
It is anticipated that our 1999 share will be even less than last year. This loss can only be made up by cutting services or by raising taxes. Frankly, neither one of these two options have much appeal. In talking with administrators from the Trinity County Schools, it is apparent that National Forests revenues have enabled our rural school district to provide the type of quality education to their students, which is on par with that provided by wealthier and urban school districts.
Revenues from the National Forest lands have also been instrumental in school modernization, in the construction of athletic facilities, and in keeping the schools' physical plants in good condition. Mr. Chairman, I have three letters from our local superintendents discussing the impact that it is having on their local schools. I would ask that those letters be submitted into the record as well.
Page 55 PREV PAGE TOP OF DOC Mr. GOODLATTE. Without objection.
[The letters referred to are on file with the committee.]
Mr. EVANS. Thank you. There is another effect on the decline in National Forest harvest, and one that has a personal impact. We have talked about the loss of revenues that schools and counties face, but the impact on the local economies must also be realized. This is the human effect, and it will ripple through the timber and logging industry.
For each $500,000 returned to the counties to share with the schools, there must have occured $2 million of actual timber production and receipts from the National Forests in that county. That $2 million means jobs. It helps to fuel our local economy, which has been tied to the timber industry for generations, which is a big part of our rural way of life in Trinity County.
A check or a payment from the Federal Government to the counties and schools does not have the same effect that actual harvesting in the National Forests does for the local economy. I believe the bottom line is this. The U.S. Forest Service should follow their own management plan.
If it would, the decades' old compact between the Forest Service, the counties, and schools would be fulfilled. The National Forest System would be properly managed in an environmentally responsible manner. The Forest Service Timber Program would be a profit for taxpayers and not a loss.
The timber industry would help to fuel our local economies, and future generations would be assured that the management of the National Forest System would be true to the principles of its establishment. Mr. Chairman, I thank you for the opportunity to appear today.
[The prepared statement of Mr. Evans appears at the conclusion of the hearing.]
Page 56 PREV PAGE TOP OF DOC Mr. GOODLATTE. Thank you, Mr. Evans.
Mr. Spain, we are pleased to have your testimony.
STATEMENT OF GLEN SPAIN, NORTHWEST REGIONAL DIRECTOR, PACIFIC COAST FEDERATION OF FISHERMEN'S ASSOCIATIONS
Mr. SPAIN. Thank you, Mr. Chairman and members of the committee. Especially my thanks to Representative Thompson, in whose district many of our people reside. For the record, my name is Glen Spain. I am here representing the largest organization of commercial fishermen on the west coast.
Many of our people are salmon fishermen. Salmon is the No. 2 forest industry, highly dependent on Federal forests for the protection of its spawning and rearing grounds. I have also got some figures in terms of the importance, not only of the commercial fishery, but the recreational fishery also forest-dependent.
These are resources that we depend on as well as intact ecosystems. I want to point out that I have heard a lot of discussion. I am certainly sympathetic to the county's position. I live in the single most dependent county on these payments in the country, Lane County, which is the largest recipient in the State of Oregon which, as a State, is the largest recipient nationally.
I have watched our schools deteriorate too, but I see this in an entirely different light. If you look at the numbers, and if you look with a little business sense, you will see pretty quickly that people are simply missing the point here. It does not matter, if you are a businessman, how many widgets you make. It matters only how many you sell, and what you can sell them for, and whether you can sell them at all.
In fact, if you were to be able to ramp up the timber harvest nationwide by 70 percent, those gains in revenues could be wiped out in a matter of weeks, because we are embedded in a global, international timber market, and we are coupling through these programs our payment schedules to counties to the timber markets in the Philippines, in Asia, in Japan, to Siberian timber harvest cut in a global market.
Page 57 PREV PAGE TOP OF DOC Those markets have historically over the past 15 years fluctuated by as much as 700 percent. Right now, if you were to double the harvest nationwide, it could easily be wiped out, because those timber stumpage values could fall to 50 percent and you have gained nothing. You have gained nothing.
Even at 50 percent, that would be twice what it was in the 1980's. In the 1980's, a perfect example, we had near record timber harvests, an economic depression in Asia, coupled with an excessive amount of foreign timber on the market, coupled with some economic downturns in housing starts here, all of which resulted in a tremendous economic loss of revenues to the counties.
Those prices are independent, by and large, from the amount of timber produced on our Federal forests. They are dependent on economic and global forces beyond the control of any county, any State, and even the Federal Government to cope with. So, one of the things that I see here coming from a county that has endorsed the administration's proposal as the number one timber-dependent county in my State, is that the counties are crying for stabilization.
They need a guaranteed way of meeting their budgets. We are fortunate to have in my county the safety net currently in place. As Mr. Lyons has indicated, the numbers are flexible. The numbers in the administration's proposal were simply carried over from an existing program. I think that formulas are really negotiable.
Now, what we are seeing, for instance, on Federal timber sales in eastern Oregon, I will give you some figures. This is from a publication called ''Production, Prices, Employment, and Trade in the Northwest Forest Industries.'' Unfortunately, I have a poor copy. I would like your consent, Mr. Chairman, to add this to the record.
Mr. GOODLATTE. Without objection, it will be made a part of the record.
[The publication referred to is on file with the committee.]
Page 58 PREV PAGE TOP OF DOC Mr. SPAIN. I will do that soon. In 1993, for instance, eastern Oregon timber sales were at $304 per 1,000 board feet. In 1997, in one quarter alone, it plummeted to $41.38, less than the cost of production. That is why those timber sales could not be sold. The market worldwide was saturated.
It just does not make any sense, frankly, to maintain the current situation of holding county schools hostage, coupling them to international timber markets that fluctuate by as much as 600 and 700 percent a year. In 1997, in eastern Oregon, the fluctuation from quarter-to-quarter was 125 percent.
In summary, I think that there are some good points and some bad points to the various bills. What I would urge the parties to do is to negotiate a common consensus bill. I think it should have the following elements in it. It should have fixed payments in perpetuity, outside of the appropriations process.
It should be indexed for inflation. Mr. Boyd's bill does that. The DeFazio bill does that. It should be management-neutral. It does not make any sense, in fact it is a disservice to the counties to entangle them even more so in a controversial issue. There are other forums for dealing with those issues.
It should not change the existing situation, as well. The counties have a tremendous amount of input into the forest management that goes on in their counties. That should remain. I think it is a healthy thing. It would be an administrative nightmare to administer where there is a choice every year of which is the highest. I think that does not make any sense. It just perpetuates the instability.
It should apply to BLM lands, as well as Forest Service lands. It does not make any sense to have a double standard. In Oregon particularly, and in northern California particularly, there are a lot of BLM lands that are sources of those payments. I suggest that if you will look at the numbers, that even for Western States, certainly the 76 percent mark would benefit the State of Oregon by more than $21 million. That goes directly to the coffers of schools and counties.
Page 59 PREV PAGE TOP OF DOC In conclusion, I think it is clear that what we are talking about here is delinking county budgets year-by-year to a market that fluctuates wildly on boom-bust cycles, based on markets in Asia, markets on foreign shores, and things that we have no control over. That is what makes sense. That is really the push behind it.
I see everybody saying that. Every county official I have ever talked to says the same thing. It is your job to figure out how to fund it. There are several mechanisms that have been proposed. Representative DeFazio, in a hearing on Tuesday for instance, noted that we have a tax incentive to export lumber. That is a tax credit to export timber jobs from particularly the western coastal regions. That can be recaptured and may help pay to the tune of several hundred million dollars for some of these revenues. There are also several other good ideas.
It does not make any sense to continue that kind of incentive when we need those jobs on shore. There are recreational revenues. In many cases those forests are more valuable for recreational use, than they are for timber use. Those should also be captured. Those are revenues as well.
Those are mechanisms I leave in your hands. That is your job. Our job on the county level is to try to make do as best we can. We are asking for stabilization. Thank you.
[The prepared statement of Mr. Spain appears at the conclusion of the hearing.]
Mr. GOODLATTE. Thank you. Mr. Hanline.
STATEMENT OF WALT L. HANLINE, SUPERINTENDENT, DEL NORTE COUNTY UNIFIED SCHOOL DISTRICT, CRESCENT CITY, CA
Mr. HANLINE. I thank the committee for the opportunity to speak before you. I want to share some of my observations of what I have just heard, and take some of my time here to also summarize my statement that I have before you.
Page 60 PREV PAGE TOP OF DOC First of all, I come from Del Norte County. It is a small county in the northern, most western part of California. It has almost 30,000 residents in the county. I have about 5,000 students. I am an elected official, and both a county superintendent, as an elected official, and a district superintendent, appointed.
I would like to present some facts about what the real world looks like in Del Norte County, I won't speak to the technical aspects of this legislation. Seventy-two percent of our land is owned by the Federal Government or State government. As you can see in my statement, recently, a study was conducted by the U.S. Department of Agriculture. They found our land is valued at $1.2 billion in our county alone. If it was taxed and owned by private industry and had private ownership, it would bring in about $12 million a year to our local tax base. If you have been to Del Norte County, as my Congressman, Congressman Thompson has been, you would see how much we need that money. Our infrastructure, the types of services we provide, desperately need that support.
So, we are not here to beg for money. We are here to say to you that we have national-owned ownership in lands in our community. We expect the Nation to help support it, because you have taken it out of our hands, our ability to control our own lands. That has got to be compensated.
Additionally, we have been here before. Since 1976, Boards of Supervisors' Assessors have been before Congress. Very frankly, we have had a lot of promises given to us and very few of them follow through with them. It is about time we get serious about solving the problem.
What we are proposing to you is a solution. In my statement, it talks about Byron Justice stated in 1976, when the original Redwood Park was created, and by the way, Redwood Park is one of the three parks in our area; Redwood National Park, Smith River National Recreation Area, and Six Rivers National Forest, all in our county.
Page 61 PREV PAGE TOP OF DOC He stated that one of the greatest concerns of local public officials, this is in 1976, was the loss of jobs, as well as the tax base, and as well as the ultimate effect on the economics of Del Norte and Humboldt Counties. In 1971, 17 saw mills existed in our county. Today, none exist.
We are not here to say go back to the 1970's and 1980. We are here to say at least let us get a little bit more progressive in the way we handle this economic resource. So, we need to look at that. Even 50 jobs, which may be one little, small mill or two would make a significant difference in our community. Just the healing of our forests from using that timber could help us out a lot.
Another statement was made. Mr. Gerald Cochran, the assessor, in 1983 stated, ''To show that Congress was mislead in testimony for both the original and the expansion of the Redwood National Park, I submit that in the testimony of 1977, it was estimated that park visitation would be 2,500,000 visitor days.
The focus was, we will take this National Park and we will make it a recreation opportunity. ''Well,'' he states, ''let me give you the reality of the situation. The 12 months ending September 30, 1982 produced 39,000 visitor days.'' What an interesting promise to give us as a local community.
You have all of this great tourism coming in. The reality is you cannot get to us. We have very restricted access. So, this is not something we can really use. One of the things I would suggest is to keep the decoupling issue out. To keep coupled the issue, the Forest Service needs to help us, as a local community, bring people into the area.
They need to be service-oriented. The local people, very frankly, are. We are very appreciative of the local service we are given by the Forest Service. I am not convinced at the National level that the Forest Service Department as service-oriented to the local community.
Page 62 PREV PAGE TOP OF DOC You cannot take roads away from us, which 42 percent of the roads in our county have access into these recreation areas. You cannot take those roads away, which is what is happening, funding us, and at the same time say that we can get our money back from recreational aspects. We cannot. You have got to help us out. The Forest Service has to help us out.
I would go to my second page of my statement before you, on the bottom. As you know, in the mid1980's, we began experiencing a distinct shift in our national vision. We started to use the forest differently. The actual mitigation revenues no longer approximated the revenue production value of these lands.
The Forest Reserve Receipts for our county plummeted from $3.7 million in 19891990 to a projected low of $1.4 million. The impact to our district was a loss of $1.1 million. To provide a perspective, I am the new superintendent. I got hired last year about this time. I come into the school district and I was faced with a $750,000 deficit; real life world.
I had to reduce nine teachers. I had to increase class sizes by two. I had to eliminate support staff. It is affecting kids. This does not reflect the reality of how our facilities look. The Congressman has been there. Our facilities are second-class because we have not had the money for 15 years. I cannot communicate more strongly the dire circumstances faced by our rural schools. Congress must take action.
I need to make some observations. I hear that we should be excluded from the discussion. The educators and the schools should be excluded. We have been a part of the situation. I do not call it a problem. We have been a part of it since 1908. Why do we now become second-class to the solution?
Our communities are impacted. We are a part of those communities. We have to be sensitive to that. If nothing else, I am an elected official. I had better be sensitive to that. So, we have to be a part of the solution. What we are proposing today is to keep coupled what has been coupled since 1908.
Page 63 PREV PAGE TOP OF DOC The thing that really bothers me is that we have these idea of the owl solution. Well, we are a part of the owl counties. We are one of those counties. The reality there is, as you all know it, the finding is going down. When was the last time that you saw school district expenditures go down over a 10-year cycle?
This is what happened to our income. Is that the promise we get? Is it that we are going to be just like the owl funded counties have been and go down? Frankly, our community does not trust the promises of the Federal Government. So, we want to have it coupled so that we can allow for an opportunityI have got to be quiet.
One last statement. I am dismayed and disappointed with the threat that there will be a veto to the discussion, when we have not yet really begun the discussion. The Forest Service is saying if they do not get their way, they are going to recommend vetoing. That is not the way to begin a discussion, if you are interested in the problem, in solving the problem.
The present situation, and maybe I am a simpleminded guy, is coupled now. So, if you are saying to us what is now, we do not want now. And we think by keeping you coupled you are going to hold the students hostage, you are holding us hostage anyway. If you just pick your ball and run home, you are holding us hostage anyway.
Solve the problem. Do not go down the veto road. Do not play that political game, because we have kids who are going to get hurt. My biggest thing is we need to be coupled, because the Forest Service has to be service-oriented.
Recreation and timber are two of the issues that the Forest Service can be sensitive to the local community. All we ask them to do is to be sensitive, and that coupling allows that sensitivity to be there. I am sorry, I went off-text. I thank you for the time.
[The prepared statement of Mr. Hanline appears at the conclusion of the hearing.]
Page 64 PREV PAGE TOP OF DOC Mr. GOODLATTE. Mr. Hanline, we thank you for your very heartfelt comments.
I want to start by picking up regarding the veto threat issued by Mr. Lyons.
Mr. Lyons, I have to tell you that I appreciate your coming and your comments on the legislation; the things that you like and the things that you do not like.
I hope we will get into some of the details of that. I have got to start out by saying that your issuance of a veto threat is nothing more than hardball, inside the beltway politics. That is a slap in the face at these counties that have come here in good faith trying to seek a resolution to this problem.
That is not the way you begin an effort to find common ground to work out a solution. I note that it comes from the Department. It is a statement that the Department would recommend to the President that he veto the legislation, and not a threat from the President himself. I think that is encouraging because, quite frankly, the President has just completed a nationwide tour of poverty-stricken areas in this country. Many of these counties would be included in those areas.
They have, in some places, double-digit unemployment rates. They have serious difficulties. The President's message was, we are not going to come here and tell you that we are going to pour some of the old hand-out, welfare programs to you, but we are going to help you get a hand-up with economic growth, economic development, encouraging growth in these areas.
If you are a county like Bath County, VA, where 52 percent of the land is owned by the Federal Government in the form of our National Forests, or some of these counties are as much as 80 percent is owned by the National Forests, this payment is only a small point of the problem.
Page 65 PREV PAGE TOP OF DOC The real problem is that, that land, if you shut it down and do not use it to generate economic activity, whether it be timber harvesting, or raising on some of the western lands, or recreation, which I strongly support. You saw and you thanked me for fighting last night to preserve the fee system where we have the opportunity to let the forests generate some fee activity from people who come in and utilize the forests for recreational purposes; that money as well.
This legislation would go to benefit the county. The more important thing is not the 25 percent of the actual fee that they get, whether it is for timber sales, or whether it is for recreational purposes, it is the fact that hundreds of jobs are created. You said we should not have our school children be caught in the middle of this.
School children are dependent upon the jobs that their parents have, more than anything else, to succeed. If you are successful in decoupling the responsibility that the National Forests have for managing those forests in a way that address not only the ecological concerns, and I will get to that in a second, but also the economic and social concerns of these communities, then you have failed in a big way those very school children that you are talking about.
Now, let me talk about the ecological aspect of this, because to me the current state of our forests, and you put up a chart showing that there are 41 million acres out of our 191 million acres of National Forestlands that are at high-risk of forest fire. I could put up another chart, courtesy of the Forest Service, that deals with the threat of disease and insect infestation, which heavily hits the forests that are in my district.
To me the way to cure this problem is not to shut down our forests and not to have management of our forests, but rather to look to increasing the amount of activity that is taking place in these forests, both recreational and responsible timber harvesting.
I was on the Goose Nest Ranger District of the Klammath National Forest a few weeks ago looking at the condition of that forest. Your agency has a demonstration project there in that Ranger District that I would commend the agency for. It attempts to restore the forest to its original conditions. This was a ponderosa pine forest where fir trees have grown up underneath. The ground is just covered with dead timber, and instead of traditional very western, very large trees with open areas in the under story that were periodically cleared out by groundlevel forest fires, you now have a situation that is ripe for catastrophe, because when the forest fire starts now, it steps up from the ground to the fir trees, and then right up into the over story of these majestic ponderosa pines.
Page 66 PREV PAGE TOP OF DOC What you have done is you have put out for bid to timber companies a project where they come in and they clear out the fir trees. They leave all of the ponderosa pines, every single one of them. They clear out the fir trees. They introduce that groundlevel fire again, and they have gone a long way to restoring that particular area to the type of ecological conditions that it traditionally had, and it should have.
But do you know what the bid was for just 2,000 acres of land? I mean some of the folks in some of the communities will be stunned to think what they would receive for this. The bid for just 2,000 acres, which is a little more than 3 square miles, was $8 million.
So, that county got $2 million under this 25 percent payment on just 2,000 acres in a county that has hundreds of thousands of acres of land owned by the National Forest. They got, in addition to that $2 million, hundreds of jobs in their community. That is where the tax for the real estate on the people who live in that community. They have got a job. They can live there. You have real estate taxes paid and other revenues. They spend money in the local stores.
That is what this is all about. That is why decoupling is a disaster for these counties. That is why the overwhelming majority of them, with the exception of a handful that you have cited here, do not want to do what you are suggesting, not because they do not want to have the money.
Everybody loves to get money, but they know that, that is not the bottom line here. It is decoupling of all of the economic activity in the community, including what our National Forests can do; not just for timber harvesting, but for recreation and other things that makes this legislation, in my opinion, so important to solve the problem, and not just from the economic standpoint of the communities, but also from the ecological standpoint of improving our National Forests as well.
I will give you an opportunityI have used my timebut I will give you an opportunity to respond. We will have another round and we can talk about some of the specifics of the legislation because I want to hear you on a point-by-point basis so I know those things, but I do want to give you an opportunity to respond to my charge that threatening to veto this legislation is heading in exactly the wrong direction.
Page 67 PREV PAGE TOP OF DOC Mr. LYONS. Well, thank you for the opportunity to respond, Mr. Chairman. First of all, I want to point out that I did not read into the record all of the letters we have, but we will be glad to provide those to the record. It is more than a handful of counties who have responded to our decoupling proposal.
I would state emphatically that the reason we were upfront about our objections to the bill we are discussing today is because we do believe that there is a need for a solution. We think we are headed in the wrong direction. We have a fundamental and basic disagreement over the issue of coupling or decoupling.
I do not think this should be a forestry debate. There seems to be implicit in your comments and those of others, a presumption that if county payments are no longer associated with the timber sales that occur in those counties, that we are going to walk away from our forest management obligations. That we are not going to invest in timber sales and the kinds of projects you just described. That is blatantly incorrect. It is an assumption.
Mr. GOODLATTE. Let me interrupt you for a second there, Mr. Lyons, and just point out that while you introduced a few letters from a few county supervisors, you probably also have a lot of letters from a lot of groups that want a no-cut or a zero-cut policy, who also support your approach. So, that is what raises the fear in the minds of these folks that there is an ulterior motive, a second agenda, if you will, to decoupling the two things. That the economic activity will die when there is no longer that coupling.
Mr. LYONS. You know, I appreciate that concern, Mr. Chairman. Let me do my best to allay their fears by saying that both Chief Dombeck and I have stated many times in testimony before this body, as well as the Senate, that we are not advocates for zero-cut. We do not support a zero-cut philosophy. We are proponents for active and sustainable management of natural resources.
Mr. GOODLATTE. I am glad to hear that. Let me ask you a question about your own chart. Your chart has an actual 25 percent fund payment trend. Then going over the next 5 years or 6 years, you have the projected 25 percent fund payment trend.
Page 68 PREV PAGE TOP OF DOC I note that, that is a continued downward trend, which would mean that you would anticipate a continued downward trend on the part of the forest for harvesting timber. I would like to know, if you do not believe in no-cut, why your own chart for the next 5 years, continues that downward march toward no-cut or zero-cut?
Mr. LYONS. The reason is, Mr. Chairman, because that chart reflects revenues, not boardfoot of volume produced. That gets back to a comment I made earlier and that is the nature of the investments we are making currently in the Timber Sale Programs are not the kind that are generating the high revenues of the past.
This is a conundrum that both the administration and the Congress face. For the past 3 years, the Congress has appropriated funds sufficient to maintain the Sale Program of between 3 and 3 1/2 billion board feet, and perhaps a little bit more than that.
As you have heard in the debate last night about the Interior appropriations spending bill, it is difficult to strike a balance in investments in all programs. So, we are spending every dollar we get for timber sale preparation. We are trying to make the most prudent use we can of addressing multiple concerns like forest health.
We are not in the business of producing the kinds of volumes and values that we did in the past, nor do we have the appropriations to make the investments that are going to generate the revenues that are akin to what we saw in past decades.
Mr. GOODLATTE. Well, you are right. We do have a difference of opinion on what the trend should be. My time is expired. I am sure we will come back to this. At this point, I will recognize the gentle woman from North Carolina, Mrs. Clayton.
Mrs. CLAYTON. Thank you, Mr. Chairman.
I am not sure where to begin. I guess I will begin with Mr. Lyons. I guess a part of the apprehension and the concern in your testimony, and I do not want to assign motives that I do not fully understand is there. I can only respond to what I am hearing. So, you need to be sensitive as to how your words are being received.
Page 69 PREV PAGE TOP OF DOC There is indeed an attitude that there is a presumption on the part of the counties that they are overdependent on these revenue for education. Therefore, they are making kids vulnerable or hostage to the lack of a nondependable revenue. I want to tell you, I think they feel they are victimized.
They are not making an elective choice of doing that. They are in counties where a vast amount of the land is now under Federal control. So, in lieu of taxes, this compact that has been in existence all of these years has been a source of revenue. They had no options of that. So, they did not elect to do that. That is indeed the result of decisions made for them.
Now, I would also agree with you, however, that the primary responsibility of education happens to be the local areas, and they need to get resources from wherever they can, first, from their own resources. By the first decision that their land was taken from them, preempted their ability to use their authority to get their revenues from their land. Ad valorem taxes across the country is a basic source for education for a county. I interpreted, and I want to be corrected. So, I am going to give you a response to what I heard. Maybe that is in error.
Mr. LYONS. I appreciate your comments, Mrs. Clayton, because I think you characterized it correctly. I think the counties are victimized by a set of circumstances that are not of their own creation. They are in a position where the dominant portion of county lands are in public ownership.
By a commitment that was made nearly a century ago, in lieu of PILT payments, an alternative approach, the counties received a commitment that they would receive 25 percent of the values that would come from timber harvest in the National Forests.
However, I think today the counties are victimized by the fact that circumstances have changed. Public values have changed. Management direction has changed. Therefore, the formula of a century ago does not fit current circumstances. We need to come up with another way to support their education mission.
Page 70 PREV PAGE TOP OF DOC Mrs. CLAYTON. Stop right there. I think you are right there. I think that is where we are, but I wanted to correct the attitude and the assumption. I think we are at a situation where conditions have changed. The situation has changed. Nevertheless, historically they are at that place because of all of these sequential and scenarios of events.
So, if we now have a serious problem, I think then we need to find out how we best resolve that problem. I agree with you. I guess this Mr. Spain, I was struck by his reality, and then Dr. Hanline. Everybody has a sense of reality; your own experiences. That is our sense of reality.
Both of your senses of realities are going concurrently. That is what makes this situation new in understanding. We do have a world market. We are all aspiring to the world market. At the same time, that has certain vulnerabilities. Also, we would be less than candid if we did not admit that there has been some policy shifts as to how much of the forestry we are now going to allow to be cut for a variety of reasons.
That is not to suggest that some cutting was in excess and should have been curtailed. It does not mean you go from managing it to make sure it is ecologically sustainable, to a no-cut. Also, at the same time, the world market is having these economic forces that we cannot compete with those because of the fluctuations of that.
Mr. Hanline, who is a superintendent of schools, finds himself with the reality that when he walks into a new and employment situation, he has a deficit of over $750,000. Now he, as being a principal or a superintendent, understand he has work in the world market. We cannot ignore the reality and wish it were not so. We cannot go back to another time.
So, I guess my plea to you, Mr. Lyons, is that the administration has to be in this game to try to bring all of those forces together and try to work out where we can indeed have a compromise. I think there are provision in each of those bills that have some value. I do not think people are just making this up.
Page 71 PREV PAGE TOP OF DOC We have different approaches to how we solve a problem. I think a part of it is we have to have a respectful attitude of a serious dimension, and a serious understanding of different people's sense of reality and bring that in with the mission of the National Forest. The National Forest was not thought out to provide education to schools. We understand that.
As the National Forest followed its mission, it acquired land, took away from schools its ability to provide land. So, when you have these corresponding effects, we have also a corresponding obligation to try to meet these public policies.
I know I have gone over my time. I apologize for that, because I am going to have to leave. I just wanted to get on the record that there is a need for all of us to kind of work at this seriously. I think we can fashion the resolve. So, I would want to just urge to do that.
Mr. LYONS. I agree, Mrs. Clayton. That is the reason why I am here is because we want to work for a solution to this problem.
Mr. GOODLATTE. I thank the gentle woman for her comments. The gentleman from Oregon, Mr. Walden.
Mr. WALDEN. Thank you very much, Mr. Chairman.
Mr. Lyons, do you support the Forest Service meeting its allowable sales quantity targets for this year?
Mr. LYONS. I have a different interpretation of what the allowable sale quantity is. So, maybe I should clarify that.
Mr. WALDEN. Would you please?
Mr. LYONS. I do not see the allowable sale quantity as a target. In fact, by definition it is a maximum capacity to produce timber from every National Forest. That is how it is calculated. So, we do not treat it as a target.
Mr. WALDEN. Well, that is interesting because I think the Chief yesterday in the Resources Committee, under oath, said he did not think the resources were there within what was being appropriated to meet those targets. I see you two differ on that point. Maybe you can enlighten me.
Page 72 PREV PAGE TOP OF DOC Mr. LYONS. Well, I would clarify that my understanding from what Mike said, from what staff told me, was that Mike indicated that we did not have the resources to harvest the full ASQ, and that is true. Nor do we set that out as a target for every National Forest. That is what I wanted to clarify.
Mr. WALDEN. Well, that may be the case, but it is certainly perceived that way on the ground in these communities, like Mr. Hanline has talked about in terms of Federal promises and commitments on how we are going to manage the lands.
The question I guess I have is in some of your comments, as well, you indicated that in part you could not meet some of these sales levels because Congress had not given you the money to do that. I think I heard that in your comments earlier this morning. That we were a part of the problem. That you did not always have the resources.
You commended us for our efforts last night on your budget. I guess my question is where were you on the Wu-Hooley amendment last night; were you for it or against it?
Mr. LYONS. We were for it.
Mr. WALDEN. Yet, that would have reduced the level below a freeze level by, what, $20 million or $30 million? It would have been what the President requested.
Mr. LYONS. It would have also provided an additional investment in other programs in an effort to try to bring balance to our total investment picture. As was discussed somewhat last night, programs like the Recreation Program have been underfunded, although the committee put additional resources there as well. So, it is difficult with limited resources to try to figure out how to provide a balance in investments and programs that are going to benefit communities beyond timber. That was the balance we sought.
Mr. WALDEN. I understand that, but it is intriguing to me, coming from a district that you know very well. You were there 2 weeks ago. The timber harvest level can be a component to forest health; can it not, with the overstocking that is occurring? Is that not a part of what is going to help our communities and public forests?
Page 73 PREV PAGE TOP OF DOC Mr. LYONS. Critical component.
Mr. WALDEN. If you cannot meet the allowable sale quantities, which you say is not really your target level, I guess you and I probably just have a difference of opinion then.
Mr. LYONS. Well, I think we have a different view of what it is we need to do to address forest health concerns. Certainly the sale program is one element. We have a salvage sale program. We have a stewardship program in which we are letting stewardship contracts go in the authority we had last year, to try and make additional investments in resource improvement. There are lots of tools, in addition to the Timber Harvest Program that we need to invest in.
Mr. WALDEN. For my own view, I guess I find it ironic that knowing the importance of the timber sale program, that when the Congress does offer up money to try and help the agency meet some of these levels that would help communities like mine that are devastated in many regions, and if you are not aware of those communities, I would be happy to have you400 people turned out on Saturday for a forest hearing in the Resources Subcommittee.
I guess I just have a lot of frustration. I resent the Department's desire to recommend a veto to this legislation. Can you tell me, has this administration, prior to this year, actually drafted legislation to deal with this issue for decoupling and to solve this?
Mr. LYONS. We did in our fiscal year 1999 submission.
Mr. WALDEN. Prior to this year?
Mr. LYONS. Yes, and then again this year.
Mr. WALDEN. Was that ever actually introduced, and who was the sponsor?
Page 74 PREV PAGE TOP OF DOC Mr. LYONS. I do not believe it was introduced. It was a part of the discussion and we did not get very far.
Mr. WALDEN. So, is there actually a written legislative document in the bill?
Mr. LYONS. Yes, we have one. I would be glad to share it with you.
Mr. WALDEN. I would like to see that as well.
Mr. WALDEN. Mr. Hanline, I would be curious to get your comments on how your communities, and others of the panel, about this debate over timber health, timber harvest, and the effect of not being able to meet some of these targets have on your communities.
Mr. HANLINE. The timber health issue is something that I have heard about in my community. There are a number of forest-oriented people and environmental people who have a real concern about some of our forests. I do not know that much about that. I will not get into that. I really cannot answer that question.
I do know that the impact of the lack of economic development in our community is problematic. It creates a real feeling of a high degree of anxiety. You mentioned earlier that the President has been out visiting different rural areas. We have a 15 percent American Indian population in our school district; the largest tribe in California.
I would love to see the President come to our community and see the impact of this last 20 years. One of the statements that Mr. Justice stated, who was the supervisor in the 1970's, is that it made a tremendous impact upon our local community, the lack of fulfilling the promises.
We feel like we have had economic terrorism done to our community. It has just gutted us. We need to change that and balance that.
Page 75 PREV PAGE TOP OF DOC Mr. WALDEN. And that is what we have seen as well in parts of the forests. Do other members want to comment? Mr. Douglas, yes, thank you.
Mr. DOUGLAS. As an educator, I would like to be able to separate the economic effects of my community and the standard of living of families from the public schools. It would make my job a lot easier if I could do that. The fact of the matter is that if you know anything about academic achievement of children, the highest correlate to academic achievement for children is their socioeconomic background and the education level of their parents.
Those two factors alone contribute significantly to the difference between children who do well in school and those who do not. That fact alone, if I am true to my profession, causes me to realize that payments to my county government and to me, as a school person, and the services we offer at school, even if I were able to offer the very best services at school, cannot be disconnected to the welfare of the families the children come from and the economic condition of their community.
The thought of simplistically separating those, for whatever motive, is just not realistic. It cannot be done. This is a complex, social, economic, and since we live in a National Forest, ecological system. We need a systems solution, not a simplistic solution.
You cannot separate the debate regarding the management of our dominant economic asset in forest communities, i.e., the forestland itself, from that impact on families, communities, and therefore schools. It cannot be done.
Mr. WALDEN. I could not agree more. Mr. Chairman, could Mr. Evans respond to that as well? I know I have used up my time.
Mr. EVANS. Mr. Walden, I would just say that prior to being elected county judge, I worked for 9 years for the Texas General Land Office, which is the management agency for all of our State lands in Texas. I can assure you that I have a great sense of pride in not only our State lands, but our Federal lands as well.
Page 76 PREV PAGE TOP OF DOC If I did not believe that this bill would lead to the proper management of our National Forests, I would not be sitting here today.
Mr. GOODLATTE. I thank the gentleman. The gentleman from California, Mr. Thompson, is recognized.
Mr. THOMPSON. Thank you, Mr. Chairman.
I just want to note for the record, Mr. Chairman, you had mentioned the importance of jobs, and the creation of jobs, and how these were important to all of these areas. All of us agree with that. The ranking member from my side, Mrs. Clayton, talked about the need to be able to go out wherever you can and get those resources to pay for these. I think we need to look at both of those comments in context with the need for a balanced approach in the way that we do it.
Mr. Spain talked about the impact that the commercial fishing industry has been hit with in his area and in the area that I represent. The truth is in Del Norte County, as well as in Humboldt County, historically the two major industries have been commercial fishing and commercial timber; both of which are on that roller coaster that has been mentioned on a downward spiral.
That is affecting everything. As we try and find solutions to the problem that we are here today to address, we cannot for a moment neglect to look at the total picture and to find a solution that balances all of these different issues, and they are very important issues to not only my district, but to every place where we are talking about harvesting.
Mr. Lyons, you had mentioned the fact that your agency is opposed to this legislation and would recommend a veto. I am assuming a part of that is because of the fact that any monies that needed to be made up from the timber receipts would come from your budget or from your acct. Is that correct?
Mr. LYONS. That is correct, Congressman. That is certainly one of the issues that we are concerned about with the bill introduced.
Page 77 PREV PAGE TOP OF DOC Mr. THOMPSON. One thing I want to clarify, we were told in a subcommittee hearing in Oregon that there is no dollar-for-dollar exchange. That timber dollars go into the General Fund and it is not at all linked to the funding of your duties. Is that correct?
Mr. LYONS. That is correct.
Mr. THOMPSON. So, really, that is two different pots of money that we are talking about.
Mr. LYONS. If I understood the question, Congressman, certain receipts go into the General Treasury. Of course, the appropriations determine how many funds we have for each program area.
Mr. THOMPSON. It is not really tied to those timber receipts. It is not necessarily tied to the timber receipts.
Mr. LYONS. That is right.
Mr. THOMPSON. I think we need to clear that up. I hear from a lot of people that if this bill goes forward that there is going to be, because you are funded with timber receipt dollars, that there is going to be this big push to increase timber cuts. So, it is important I think to clear that up.
Second, though, if in fact your budgets are reduced in order to make up this extra money to fund local governments, which I think not necessarily from your accounts, but we do need to do, how will that affect the other chores that you have; everything from survey management to whatever else you do?
Mr. LYONS. Well, I would suggest that we are pretty strapped right now. So, it would certainly have an impact on our ability to do a host of things; everything from our Forest Management Programs, to Wildlife Recreation Programs, to the Assistance Programs we have to work with rural communities.
Page 78 PREV PAGE TOP OF DOC Mr. THOMPSON. That is important to note too, and the reason Mr. Walden brought up the Wu-Hooley amendment last night. I voted against that amendment, but not because I did not believe that there needed to be more money used for restoration and things of that sense. I just felt that it was bad policy to rob Peter to pay Paul.
You are already strapped for money. In my district and from what I could gather on our subcommittee hearing, in Mr. Walden's district, you do not have the resources, the human resources or the fiscal resources, to do the job that you are supposed to be doing right now. That is impacting everything; everything from fish, to timber, to forest practices.
Everything that you do is impacted by that. So, I think we need to spend the money for you to do your job, but not separate it from within your Department telling you what is a greater priority. I would like to ask Mr. Spain, given what Mr. Lyons has just mentioned, I would like to know if you believe that fisheries policy and that resource is impacted at all by the work that Mr. Lyons' Department does?
Mr. SPAIN. It adds a little, yes, as you are aware and I hope other Members of Congress are aware, the last best spawning areas left for salmon, and the key areas from which we will build out to restore and recover salmon, many of which are listed on the Endangered Species Act primarily because of past forest practices, are on those public lands.
One third, for instance, of all available salmon habitat is on public lands. Public lands play an absolutely crucial role. That is why clearly our organization has had to take a position for a more ecosystem approach, more riparian protections, et cetera, on public lands.
If I could comment on another portion of the issue, I think it has to be understood that based on economic realities that we are dealing with, we can debate forest health until we are all blue in the face, to no avail.
Frankly, most us have, and it will not do very much good one way or the other for the counties because of the economic forces they find themselves battered by and seesawed around by on this economic roller coaster, as I have described. That is the point of my testimony.
Page 79 PREV PAGE TOP OF DOC We need to be working on ways to decouple, if you will, and this is the only decoupling we are talking about really here, decouple county budgets from international timber markets that fluctuate by as much as 700 percent, and can do so within a single year.
That is the problem that the counties are really facing. I frankly think that there are elements in all of these bills that will help address that problem. I am glad to hear Mr. Lyons and the administration willing to talk and compromise on some of those numbers. We have most of the pieces here, gentlemen.
Mr. THOMPSON. I just want to finish, Mr. Chairman, if I may by saying that I do not really think that this takes us off of this roller coaster or puts us on this roller coaster tied to either foreign markets or fluctuations within the Deptartment. I think that this is an attempt to stabilize that to get us off of it.
I think if anything, Mr. Spain, we probably should figure out a way to do more coupling and couple in some other industries. So, everybody does have a real interest and make sure that we have the revenues necessary to provide a stable funding base for rural communities, and communities that are dependent upon Federal lands that have been taken off the tax rolls. Thank you.
Mr. GOODLATTE. I thank the gentleman for his comments. We will do another round. I would like to followup on that. Mr. Spain, ideally what you want to do is great, but it is not economic reality. How is it that you can decouple a county's economic well-being from the international timber market, when we are not just talking about these sales on Federal lands?
All timber sold on private lands that create hundreds of jobs in each of these counties is dependent upon how the market goes. It is going to certainly fluctuate. Virtually all of the activity in a county that is heavily-dependent upon timber harvesting is dependent upon how that goes.
Page 80 PREV PAGE TOP OF DOC So, the revenues from the taxes paid by the employees, and the companies that employ those folks and sell this timber is going to fluctuate on that basis. The real estate taxes paid by private property owners; certainly the value of their real estate may well fluctuate for the taxes they pay, based upon the value of the timber stands that they have; the taxes paid by those folks in the community that are dependent upon the well-being of the timber industry.
So, it seems to me that while you are right that it is going to fluctuate, I do not dispute that at all, that coupling the economic well-being of the citizens of a county and their privately-owned land with the economic productivity; whether it be recreation, or whether it be timber harvesting, or whatever the case might be of the publically owned land that they are heavily dependent upon because so much of it exist in these counties is a reality that they are going to face in every one of those other areas. Decoupling it in the are of the Forest Service's management of their land is getting away from economic reality, rather than moving toward it.
Mr. SPAIN. Let me respond to that, Mr. Chairman.
You are correct in that a lot of counties are timber-dependent and thus they are dependent on those international markets. I represent an industry that is very dependent on those global markets as well. We suffer as well. However, why should the schools, why should the county road budgets bear the burden of those fluctuations?
Mr. GOODLATTE. Because otherwise it is simply welfare. That is why.
Mr. SPAIN. It is a guaranteed payment because those lands are county lands, and there has been a compact with the Federal Government between those counties since 1908. That, to my mind, is not welfare.
Mr. GOODLATTE. If you shut down the lands, and you just let them sit there, now of course Mr. Lyons says we are not going to do that, but we know there are some people who advocate doing that. If you do that, then in my opinion those lands have very little value. Timber stand is valuable because it has a number of different resources.
Page 81 PREV PAGE TOP OF DOC It might be used for recreation, for wildlife, habitat management, but if you simply shut it down and do not have any kind of responsible management of the land, then that land is gone down in value. The payment that we are making to the community, regardless of that value of the land, based upon some formula is lost.
Mr. SPAIN. Mr. Chairman, that is not what these bills do. That is not what is under discussion. What we are talking about is one issue, and one issue only. That is the linking of county schools and road budgets to the international timber market that can fluctuate by as much as 700 percent.
Mr. GOODLATTE. But the county schools and road budgets are linked to the international timber market, if that is the primary source of economic activity in that community, whether it is off of Federal land or private land.
Mr. SPAIN. Why make the situation worse by directly linking it? In the spotted owl counties, that linkage has been supported by a safety-net. This is essentially what we are talking about extending to the rest of the counties. There are 760 counties that I feel deserve a similar break.
Mr. GOODLATTE. If the outcome of that is to have a diminished interest in economic utilization of our National Forests, as well as ecological and social utilization of our National Forests, then you are going to have a dramatic downturn in economic activity in all part of that county. It is going to be reflected in other aspects of the counties' tax revenues because it is all interdependent. That is why if you try to decouple in one area, it is an artificial decoupling.
They know that it is not decoupled in the other areas, because the revenues they receive definitely is dependent upon the economic activity that takes place in their community, and the fluctuation in prices that take place in the international marketplace. Why should the National Forests be immune from those economic realities?
Page 82 PREV PAGE TOP OF DOC Mr. SPAIN. Nothing is immune from global realities. Mr. Chairman, really what we are talking about here is one linkage that links directly, budgets for schools and counties, county road budgets, to these fluctuating markets. This is a boom-bust economy, and it has been, and will be for the foreseeable future. That is the issue.
I live in a county that has been receiving safety-net payments. I do not see any diminishment of an interest on the part of the citizens in the management of those public lands; quite the contrary. I see people much more involved than they ever have been.
It is not a given that if you provide money for schools on a guaranteed basis, that people in those counties will be no longer concerned about the Federal lands that they live around, and that they use for recreational purposes, and that support industries such as ours.
Mr. GOODLATTE. Ms. Collins, would you like to respond?
Ms. COLLINS. Yes, I would like to respond because our community, being 52 percent National Forest, we rely heavily on the National Forest not only for timber sales, but also promotion of tourism, which is our number one industry.
So, therefore, ecotourism is very important to us. If the forests are not managed properly, then we have a problem. Also, we have many people who rely on the forests, not only for jobs, but also for their livelihood, for living day-to-day. I mean, when you have a poverty level of 10 percent in your community, guess what? Those people hunt and fish on National Forestlands.
They live off the National Forest because there are not enough jobs in the community to sustain their families. They do not want to move elsewhere. They do not have the wherewithal to move elsewhere. Our unemployment rate, right now, in our community, as of March 1999, is 10.9 percent.
Now, we may have a small community, but yet it is one of the top five in Virginia as far as unemployment. I think we are all dependent on each other. In our community we see that a National Forest as a part of our community. It is an important part of our community. They have some of the prime lands for economic development.
Page 83 PREV PAGE TOP OF DOC We cannot get our hands on it because, unless we have lands that we can swap that they like, we cannot have that happen. Every time we have an entity come in, guess what? They see the National Forestlands as being the most viable land and not any other land that we have in our community.
So, therefore we are at a loss. The whole purpose of Federal, State, Local Government and the people who are in the communities is to create a sense of community, to create a family approach. If we are not linked together and linked apart, then we are doing a disservice to the citizens of this country.
If we are doing a disservice, then we should not be in the jobs that we are in or representing the people that we represent. Rural communities need each other. We need the National Forest with us at the table. We need to address the poverty levels all together, the unemployment issues, the management of the forests all together.
The situations we have got as a small community, and also throughout this country with at-risk youth make it inevitable. What happened in Colorado also ricocheted on us. We had a situation happen that Friday in our high school.
So, if we do not all work together for sustainable National Forests, as well as our economics and our communities, then there is no sense in being, and we are doing the public a disservice. I would say to the public, take over all of your governments. Take over all of your agencies.
Mr. GOODLATTE. Mr. Douglas, you know more about the National Forest Counties and Schools Coalition than anyone. Tell us how you put that together. How did you forge this coalition, develop a core set of principles, and then a piece of legislation based on those principles?
Mr. DOUGLAS. We have had in California for probably 15 years, 39 county superintendents that received Forest Reserve money. That organization formed, as I have said, about 15 years ago. It became very apparent about 3 years ago as we visited Washington and met with our Representatives here that a group of well-meaning, fairly well-organized school superintendents had no chance of doing anything here in Congress.
Page 84 PREV PAGE TOP OF DOC The advice that we received from many of you was that we needed to reach out to other folks that you are hearing from around the county, and to connect to each other, and come to Washington as a broad-based national coalition, and present to you our ideas, and to talk about it long enough and hard enough that we presented to you some level of consensus.
Two years ago, we sponsored a meeting in Reno, NV. We had 24 States represented and about 158 people from across the country, primarily school superintendents, and county commissioners, although there were some representatives of the business community with us at that time as well. That was a good conversation. We were not quite ready to build consensus, but the need was clearly stated.
We then brought people together in March 1999, this year. There were almost 200 of us from about 25 to 28 States. We developed a set of principles. Those principles are in my written testimony. They were hammered out, first of all, by a group of about 40 people, some of whom are in this room today.
Then presented to 200 people or so who were in attendance at the conference, and almost unanimously, like 200:3, adopted by that group. Since then, we have circulated those principles throughout the Nation. This has been primarily a word-of-mouth campaign. It has grown.
The first weekend in a 3-day period we went from five members to about 150 members. From there, it has grown to this time to be over 500. We are growing 150 to 200 organizations per 6- to 8-week period. We just did our first formal mailing to the 6,000 school districts in America that receive Forest Reserve payments.
We would expect our membership to grow significantly. This has been the easiest recruiting work that any of us have ever done. As soon as people from these counties, businessmen, school people, county Commissioners, labor folks hear about this organization, they look at the principles.
Page 85 PREV PAGE TOP OF DOC They resonate with those. It was hard work to develop the initial principles, but the people who are in the coalition are deeply committed to staying together as a group, grassroots, local group, similar to the Quincy Library Group, but on a more national scale to solve this issue.
Mr. GOODLATTE. Does Quincy support your coalition?
Mr. DOUGLAS. Absolutely. The counties that are a part of the Quincy Library Group are all a part of our organization. In fact, my county is a part of the Quincy Library Group area. As I have told you before, I had served in the Plumas Unified School District for a good long while. Those folks who are a part of the Quincy Library Group are supportive of this coalition.
Mr. GOODLATTE. Thank you. Mr. Walden.
Mr. WALDEN. Thank you, Mr. Chairman. I just wanted to followup on some of the comments that were made; Ms. Collins, Mr. Hanline, and others. I guess I just have a real high sense of frustration because I have counties similar to those you have described; 12.1, 12.9, 15 percent unemployment in some cases; 70 to 80 percent Federal lands.
I have got to tell you, when I look at these charts, I do not see a roller coaster. I see a ski slope, if you will. It starts about the time this administration came into power. Frankly, I have, and I do not mean to be harsh, Mr. Lyons, but I do not see any evidence that indicates to me a willingness to even do multiple use on the Federal forests, as I would define it and I think as you read it; not when you have reduced timber harvest by 70 or 80 percent; not when the President's own Northwest Forest Plan, the harvest levels cut 80 percent, and then we are going it down, then we have got to survey and manage 421 species, some of which you cannot even identify, except with a microscope, and may only come out once ever 5 years.
This is not logical, sound management of our Federal forests. You and I are going to just have to differ on that. I appreciate what you are doing in eastern Oregon; try and take another look at how we can manage it. I would have appreciated knowing, in advance, you were going to come into my district and do that. I am glad that we are going to take a look at it.
Page 86 PREV PAGE TOP OF DOC I want to see what the outcome is too. I guess I just see a string of promises made and promises not kept. I am disturbed by the sense that what I tend to believe what an allowable cut was, is not what I thought it was. I thought that was the goal to be achieved. I thought it was allowed because we have so reduced what can be cut to begin with.
We have so isolated and set aside those areas that can be harvested. So, it disturbs me to hear that. Mr. Lyons, will your agency recommend a veto for any proposal that does not include decoupling? Is there any proposal we can do, short of decoupling that you would be in support of?
Mr. LYONS. I do not think I can answer that hypothetical, Congressman. As I indicated in my remarks, we would recommend a veto, if the bill is introduced, and if it were sent to the President's desk. I think we want to discuss the whole host of these issues. I think as all of the panelists have indicated, there are elements of solution there, but there are certain elements that we find unacceptable.
Mr. WALDEN. Is decoupling a make-or-break issue for the administration?
Mr. LYONS. Right now, it is.
Mr. WALDEN. It is.
Mr. LYONS. Right now, it is, and if I could elaborate on that, I would tell you why.
Mr. WALDEN. Certainly.
Mr. LYONS. Actually, I think the comments made by Ms. Collins helped to bring this more into focus with me. Really, all we are talking about here is a way in which we are going to manage the National Forests as a community, and how we are all going to be a part of a process, so that the communities and the Government, in its role as the facilitator and in providing information, expertise, resources can help the community realize its vision. The only way our proposal differs from what is currently the situation, is we suggest first we deal with the issue of stable funding for schools and community services. Stabilize that funding. Get a permanent appropriation, so that issue is off the table and the counties can plan. They can plan on the future of education, and social services are going to be provided for those communities.
Page 87 PREV PAGE TOP OF DOC Then we need to work together, as a community of interest, local and State governments, and other interested organizations to try and determine what the county desires for the future of its National Forests, and work together in a collaborative way to realize those objectives; not running away and excuse the program in one direction or another.
The problem with the bill as is currently pending is it would create an imperative to generate revenue. If the revenue is not there, then it would take resources away from existing Forest Service Programs.
For example, in Ms. Collins' county, what would happen is if the Forest supervisor could not get to that revenue level, he might be forced to take money away from his Trails Program, from his Wildlife and Fish Program, from his Forest Health Program maybe in the spring he does to reduce gypsy moth.
That would impact all of the other elements of the National Forest Management Program that are critical to our economic basis in the counties.
Mr. WALDEN. Mr. Lyons. The point that I see is, if you go back to the Northwest Forest Plan where you tried to have a community-based solution. You come to John Day [Forest] where we had 400 people in that community of 8,000 in the county, there is no solution those 400 people would agree to that this administration would accept.
Mr. LYONS. I understand.
Mr. WALDEN. Well, maybe you do. That is where we are going to part company because you had the Summit Fire there; 40,000 acres overstocked, gets away. We do not go in and try to stop it on time. It burns away and it sits there for 2 or 3 years because you can't go in to harvest. The value of the timber goes from $30 million down to $1 million.
I am not convinced that decoupling is the answer. I continue to oppose it. I do not believe you have the votes in this Congress to pass a decoupling bill; do you? Have you counted?
Page 88 PREV PAGE TOP OF DOC Mr. LYONS. I have not attempted to.
Mr. WALDEN. Do you think there are votes here to set a harvest level?
Mr. LYONS. I hope not.
Mr. WALDEN. Well, I do not think there are either; although we might disagree on our hopes. I guess that is the point. I think you are going to have to come somewhere between those two.
Mr. LYONS. I hope the thing we do agree on, Congressman, and I know we do is that we need to resolve this problem for the benefit of these committees and the school children who are impacted.
Mr. WALDEN. Mr. Hanline.
Mr. HANLINE. With that in mind, I want to make sure that I put this in context. The short-term safety-net is not a long-term guarantee. The short-term safety-net is about getting this discussion resolved within a short period of time.
Mr. WALDEN. Right.
Mr. HANLINE. So, if nothing else, we can commit for the next 5 years, with the imperative that we are going to solve the problem. We are in a position right now, we are looking 5 years out, and we have had it as of school districts and counties. So, we have to have the problem solved.
I want to add a little bit to Bob's statement. We have a coalition that slowly began and is moving faster. Make no mistake, both sides of the aisle, your decisions this year and the money you have available should be placed upon students. The rural school districts deserve a one-time shot, and we are talking $300 million, $400 million, I do not know, but it is not too much to ask when you take away from us the billions of dollars of assets.
You all can play your political processes here. Both sides of the aisle have got to deal with the ramification. Give us a chance. administration, give us a chance. Commit and trust the facts. The imperative is you have to solve it in 5 years anyway.
Page 89 PREV PAGE TOP OF DOC We could be in the same position we are in now, 5 years out. Just give us the 5-year, with a commitment to bring players together reflective of what Congressman Thompson wants. He wants a balanced group and we could solve the problem.
Mr. WALDEN. Mr. Hanline, perhaps I have not made myself clear. I concur with what you are saying fully. What I am witness to is the formula you talked about with its declining payment schedule. A part of that overall Northwest Forest Plan also said we would have cut available, harvest available.
We would have lands available to do active management on, and then in the middle of the night we put in survey and managed requirements for 421 species they cannot even identify. Now, we are getting an appeal a day on anything you try to do on those lands that were set aside in the Northwest Forestland to be productive. I do not want to see us fall in that trap again.
Mr. HANLINE. I understand that.
Mr. WALDEN. That is where I am with you on.
Mr. HANLINE. I am talking about the local perspective. That is the only reason I am here. Gentlemen and lady, solve the problem for the kids' sake. If not, political imperatives will get them out. The reality is that this problem has to be solved. We cannot continue to gut our schools.
Mr. WALDEN. I have a fourth grader in public school in this district; not here where we are sitting, but back home. So, believe me, I share your commitment.
Mr. Douglas, did you want to comment? Then I have overdone my time.
Mr. DOUGLAS. I just wanted to reiterate that the bill, as we have currently recommended that it be put into legislation, and as it is, is a middle ground approach. It does, for a 5-year period, take kids in schools out of the debate.
It is a partial decouple. It is not a permanent decouple. It is a temporary one. It takes care of that issue. It also does not allow the Federal Government to go merrily along its way and not address the longer term issue, which is what happened frankly in the Northwest Plan.
Page 90 PREV PAGE TOP OF DOC We did not have a followup procedure. We did not have a real commitment to nationally solve the problem and have the debate. We believe that an agreement at this point to a decoupling proposal of any kind is premature. There is not the trust level in rural America to embrace that concept. And why would there be?
We have not laid an appropriate base. If it is a good idea, then put it into the arena of debate and discussion over the next 5 years as a part of this national committee and it will become a part of the recommendations. If it is not an idea that will stand on its own merits in the long-run, then it will not be a part of the final solution.
We believe that our bill provides for that discussion of the decoupling issue, and any other discussions. It does not prejudice the final outcome of a long-term solution. It creates a vehicle for that to happen. It mandates that needs to happen, not just a payments piece.
We do need, as Walt said and I said, immediate relief for these counties. That is why I am here also, and why I am investing a lot of time and energy in this effort. That has to happen for our school kids. We also have to do the other piece for our communities and the long-term piece so we are not back here every 5 years going through all of this. That is needless wasted energy.
Mr. GOODLATTE. I thank the gentleman. I want to thank all of the members of the panel for their participation. This has been a very lively and a very good discussion. I think it is very productive in terms of our efforts to find a solution to this problem.
Mr. Lyons, we will continue to work with the administration. We want to find a solution to this. We think we are very close to it. We think that decoupling is not the answer, and that finding a way to encourage the Forest Service to engage more on this issue of what the ecological, economic, and social ramifications of the management of the forests have on the forest itself, and the communities, and the citizens who utilize those forests or live in and around them is a vitally important part.
Page 91 PREV PAGE TOP OF DOC We want to make sure that there is a good flow of funding to the communities for their school systems. We think that the Forest Service can find those funds. It concerns me. You know we have had a number of hearings on the issue of mismanagement of various funds within the Forest Service.
So, I have a hard time saying that we cannot find those funds and the Forest Service saying they are strapped when they cannot account for what the Service spends. I am not sure is whether they do not get enough money, or whether they do not spend the money that they have in a proper fashion or properly manage the money that they have.
So, we will continue to work with the Forest Service on all of those issues, including how we can reserve some of those funds for this purpose. But we think the best way to do that is to continue to have economic activity of all types in and around our National Forests.
That will be what will most assure a bright and prosperous future for those people who live in the communities that are dependent upon those forests. I thank you all for your participation. I do have some final closing requests.
I would ask unanimous consent to allow the record of today's hearing remain open for 10 days to receive additional material.
Mr. Spain, that will allow you to get a better copy of that material you have; and supplementary written responses to any question posed by a member of the panel.
Without objection, it is so ordered.
This hearing of the Subcommittee on Department Operations, Oversight, Nutrition, and Forestry is adjourned.
[Whereupon, at 1:30 p.m., the subcommittee was adjourned, subject to the call of the Chair.]
[Material submitted for inclusion in the record follows:]
Page 92 PREV PAGE TOP OF DOCStatement of Hon. John E. Peterson, a Representative in Congress from the State of Pennsylvania
Mr. Chairman and members of the subcommittee. Today I want to share with you my perspective regarding the importance of the Federal Timber Sale Program to the counties of rural America and my support for H.R. 2389 the County Schools Funding Revitalization Act of 1999.
Mr. Chairman, I live in the northern tier of Western Pennsylvania, home of some of the finest hardwoods in the world. For this reason, I have a different perspective than many of my western colleagues that represent districts with pine, fir and other softwoods. Although the cut on this fine forest has decreased from a high of 100 million board feet per year to 6 million board feet this year, the price of the wood being harvested has risen dramatically during the same period. So while I am gravely disappointed that we have been losing timber producing jobs, we have not been feeling the double shot effect of losing the revenue share of the timber being harvested.
In 199899 two of the counties I represent, Forest an Elk, received $750,000 and $113,000 respectively. As you can imagine these counties, and therefore school districts, depend greatly on this money in their budgets. If timber cutting were to decline further, and prices fall, our counties would not be able to sustain the school system and schools would close.
But frankly, if cutting declines much further, there will no longer be any kids to teach. Without timber jobs, upon which these rural counties rely, families will continue to move to cities in pursuit of often times lower paying urban jobs.
At this time I would like to say that the worst mistake we can make is the de-linking of timber receipts to county payments. Under the administration's proposal we would simply be creating a new form of welfare that will not work. The people of rural America are hard working, proud people that don't want something for nothing. They know that a government welfare program is merely the beginning of the end for their rural way of life.
Page 93 PREV PAGE TOP OF DOC That is why I have been encouraged by the efforts of the Forest Counties and Schools Coalition. Make no mistake about it, because of the unique situation of the Pennsylvania forests, namely the fact that our 25 percent payments have stayed constant, I was cautious and voiced concerns when they first came to me with their proposal. Originally I was concerned that the timeline for creating a new plan was too long. I knew that, if given the opportunity, the administration would allow timber harvests to continue their steep decline, eventually eliminating the timber program completely. Also, I was concerned that there would no longer be an incentive for the U.S. Forest Service to continue its timber harvest program. But through a long negotiation process with plenty of input, I think the coalition has come up with a good alternative. The result was reasonable time lines for the implementation of a long-term plan and an incentive for the Forest Service to continue the responsible stewardship.
Mr. Chairman, I am very sympathetic to the plight of counties in the West. My district is not feeling the same effects of the decline in timber production to the same degree, yet! I know that we must help these counties but at the same time retain an incentive to continue harvesting trees. It is important for the economic health of the communities and the environmental health of our national forests.
Thank you Mr. Chairman for the opportunity to come before you today. I hope that my perspective on this issue adds to this debate in a positive way. I'd be happy to answer any questions you may have.
Prepared Statement of Hon. Allen Boyd, a Representative in Congress from the State of Florida
Mr. Chairman, first of all, I want to thank you and the other members of this xubcommittee for allowing me the privilege of testifying before you on H.R. 2389, the County Schools Funding Revitalization Act of 1999. The issue of forest revenue payments by the Federal Government to local affected communities is very important to a large portion of the Second Congressional District of Florida, which is a very rural district that encompasses 19 counties in the Florida panhandle. In fact, I have been working on this issue since the time I was serving in the Florida State Legislature. I hope this hearing is the springboard to have Congress finally address and solve this issue that adversely affects so many communities across this nation.
Page 94 PREV PAGE TOP OF DOC The Second Congressional District, which I have the honor of representing in the House, is located in the panhandle of the State, running from Panama City in the west to the middle of the Osceola National Forest in the east. It has the entire Apalachicola National Forest within its borders and also encompasses part of the Osceola National Forest. The district has over 760,000 acres of national forestland.
In 1908, Congress recognized that counties with Federal lands were at an economic disadvantage since local governments were powerless to tax these lands. Congress entered into a compact with these communities in which 25 percent of the revenues from National Forests would be paid to the states for impacted counties as compensation for their diminished local property tax base. By law, these revenues finance public schools and local roads. As one can imagine, these counties relied heavily on this revenue for education and transportation infrastructure.
However, in recent years, the principal source of these revenues, Federal timber sales, has sharply declined due to changes in Federal forest management policy, and those revenues shared with states and counties have declined precipitously. Payments to many counties have dropped to less than 10 percent of their historic levels under this compact. The impact on rural communities and schools has been staggering. The decline in shared revenues has severely impacted or crippled educational funding, and the quality of education provided, in the affected counties. Many schools have been forced to lay off teachers, bus drivers, nurses, and other employees; postpone badly needed building repairs and other capital expenditures; eliminate lunch programs; and curtail extracurricular activities.
Rural communities have also suffered from severe economic downturns causing high unemployment, domestic violence, substance abuse, and family dislocation. They are finding it difficult to recruit new businesses and to meet the health and social needs associated with the displacement and unemployment. Finally, local county budgets have been so badly strained that communities have been forced to cut funding for infrastructure needs and other local government programs, to offset lost 25 percent payment revenues.
Page 95 PREV PAGE TOP OF DOC In 1993, the Congress enacted a law which provided an alternative annual safety net payment system for 72 counties in the northwest region of the country, where Federal timber sales had been restricted or prohibited to protect the northern spotted owl. This authority for the 1993 safety net program will expire in 2003. No comparable protection has been provided for the other 730 counties across the Nation which receive forest payments. An equitable system of payments for all forest counties nationwide is needed to protect the ability of these counties to provide quality schools and roads and to allow the Federal Government to uphold its part of the compact.
A CASE STUDY
As members, we have all heard about, and many of us actually have, counties that have been adversely impacted by this compact being broken. I have several in my district, but will focus on Liberty County as a example of how the lost revenue has affected a large portion of this Nation and its citizens. This case study shows the various effects that the loss of timber revenue from the Apalachicola National Forest has had on the children and citizens of Liberty County.
Liberty County is a rural county with a population of about 7,000 including 1,300 schoolchildren. That is the smallest county population of schoolchildren in the entire state of Florida. It has a total land area of 525,000 acres, 97 percent of which is forested, with half of that owned by the U.S. Forest Service within the Apalachicola. Until recently, the forest was the mainstay of a strong local forest product-based economy, and through sharing 25 percent of the revenue from timber sales, provided substantial support for the local schools and government.
In 1989, the Forest Service began to manage its land in a different way, mostly to protect the habitat for the endangered red-cockaded woodpecker. It is interesting to note that Liberty County has the only recovered population of this bird in the world. Perhaps the most significant thing about these changes is not the decline in harvest, but rather the fact that in 1998 the net annual growth of timber on the Apalachicola National Forest was about 800 percent greater than the volume harvested. The sawtimber growth is approximately 50 times greater than the volume harvested.
Page 96 PREV PAGE TOP OF DOC The effects of timber harvest reduction on forest revenues to the four counties and school districts within the Apalachicola is that the 25 percent payments have declined in value from a 198387, 5 year average (in 1998 dollars) of $1,905,000 to $220,000 in 1998; a loss of 89 percent. Due to this reduction, the Liberty County School District was forced to take several painful steps. These steps included reducing school staffing by 11 positions out of a total of 151; increasing the average class size from 23 to 28 students; discontinuing the enrichment programs in health, computer education, and humanities; discontinuing vocational programs in industrial arts, small engine repair, and electronics (80 percent of the graduates do not attend college); curtailing the school media center; eliminating certified art and music teachers from the elementary school staffs; reducing the Pre-K program, formerly the only program in the state to serve all four-year olds; and terminating a new program in technology acquisition, which would have placed the county on par with other Florida school districts.
The impact on county government have also been very significant. The county road crew was reduced from 23 to 18 positions. This staff reduction, plus equipment obsolescence and the inability to purchase needed supplies and materials, has resulted in the deterioration of the rural road system. In 1994, the county was forced to float a $1,780,000 bond issue in order to meet current road needs. It is unclear how the county will meet its future road responsibilities in the absence of a substantial increase in the 25 percent payments from timber sale receipts. County employees suffered a 10 percent salary cut, which was partially restored following the imposition of a 1 percent local option sales tax and 7 cents per gallon gas tax. Finally, the Sheriff's Office and Emergency Medical Service have been forced to curtail hours and reduce services. As a result of this action, Liberty County remains the only county in Florida without an advanced life support system as part of the county emergency response organization.
However, the most far-reaching and devastating impact of these declining revenues is the adverse effect on the future of our children. An education system crippled by such funding cuts cannot train our young people in the skills needed to join tomorrow's society as contributing, productive, taxpaying citizens.
Page 97 PREV PAGE TOP OF DOC It is clear to me that the compact of 1908 is broken and needs to be fixed immediately. That is why Representative Nathan Deal and I have introduced the County Schools Funding Revitalization Act of 1999. This legislation is based on principles that were part of a compromise agreement reached by the National Forest Counties & Schools Coalition. This bill is significant because it was developed not by a Washington knows best, top-down approach, but rather through a home-grown, bottom-up approach that has finally reached a consensus. This unique coalition includes over 500 groups from approximately 32 states including school superintendents (including Hal Summers, School Superintendent of Liberty County, Florida Schools), county commissioners (including the Columbia County, Florida Board of County Commissioners), educators, several labor groups, the National Education Association and the U.S. Chamber of Commerce.
H.R. 2389 contains two main provisions. First, it would restore stability to the 25 percent payment compact by ensuring a predictable payment level to Federal forest communities for an interim 5-year period. This temporary 5-year payment program would be based on the average of the three highest payments received by a state in fiscal years from 1985 until this bill is enacted. This is obviously a necessary step to arrest the current destructive downward spiral. Second, the bill requires the Federal Government to collaborate with local community and school representatives as part of the Forest Counties Payment Committee to develop a permanent solution that will fix the 1908 compact for the long term.
There are other options that have been proposed to address this problem, from decoupling forest receipt payments from forest management activities to legislating or mandating timber harvest. My view is that the welfare of schools and county governments cannot be artificially disconnected from the economic stability and social vitality of rural counties. I do not feel that either one of those options is a starter in this Congress. However, I truly believe that the consensus compromise that H.R. 2389 represents is the one possibility that could be passed.
Page 98 PREV PAGE TOP OF DOC We, the Federal Government, must fulfill the promise made to these communities in 1908. Together, we can fix the compact and restore long-term stability to our rural schools and governments and the families that depend on them.
Again, thank you for allowing me the opportunity to discuss the issue of forest timber revenue payments and the solution that Representative Deal and I have developed. I stand ready to try and answer any questions that my colleagues might have.
Statement of Hon. Jim Turner, a Representative in Congress from the State of Texas
Thank you very much, Mr. Chairman, Mrs. Clayton, members of the subcommittee for asking me to come here before you this morning.
It is truly a pleasure to be able to testify, with my fellow colleagues and distinguished panel members, before the Subcommittee on Department Operations, Oversight, Nutrition, and Forestry regarding such an important issue as providing adequate funding and long-term stability for our schools and local governments which depend upon the 25 percent payment compact.
The Federal Government and rural forest communities entered into a compact in 1908 to distribute 25 percent of the revenues generated from Federal forest lands to counties to compensate them for a reduced local property tax base. By law, these revenues from the Federal Government had to finance rural public schools and local road infrastructure.
For many years, this agreement between Federal and local governments was satisfactory for both parties; however, in recent years, with the dramatic decline in Federal timber sales and the absence of other significant revenue sources from Federal forest lands, many counties and schools that are dependent upon the 25 percent payment proceeds have suffered.
Representing 19 east Texas counties with almost 640,000 acres of national forest land, I have seen firsthand the staggering effects of the reduction in payments to many of our local counties and schools. For example, many schools have been forced to lay off employees, postpone building repairs, and curtail other important school activities because of this loss of critical funding. In addition, local county budgets have been depleted and communities have been forced to cut funding for social programs and local infrastructure to offset the loss of revenues from the 25 percent compact.
Page 99 PREV PAGE TOP OF DOC In an effort to correct this problem, I am pleased to join with a bipartisan group of my colleagues in cosponsoring H.R. 2389, the County Schools Funding Revitalization Act of 1999. This legislation restores stability to the 25 percent payment compact by ensuring a predictable payment level to Federal forest communities for an interim five-year period, and requires the Federal Government to visit with local county and school representatives to develop a permanent solution to the current trend of declining 25 percent payments. I believe this proposal is a critical first step in providing our local communities with the resources necessary to improve local schools and infrastructure.
In closing, I would like to thank you for allowing me the opportunity to speak to you about an issue that is so important to East Texas and other forestry communities throughout the Nation. I commend the Subcommittee for their decision to hold a hearing on such a significant topic and look forward to hearing the testimony of the other panelists as we work towards finding a solution to this problem.
Statement of Hon. Nathan Deal, a Representative in Congress from the State of Georgia
Thank you, Chairman Goodlatte, for providing me the opportunity to testify before you and the subcommittee regarding the critical issue of county schools funding. We must support our rural schools and communities, and this hearing is an important and appreciated effort for those with forest lands in their districts.
In the Ninth Congressional District I serve in Georgia, 15 of my 20 counties include national forest land. In fact, the Chattahoochee National Forest encompasses more than 50 percent of my district. Counties that have the largest amount of forest land in my district include Towns County with 64 percent and Rabun County with 63 percent. Such communities do not collect property taxes for these Federal lands and greatly depend upon forestry resources for their schools and economies. Therefore, effective forest management is an issue of vital importance in rural areas such as mine, and there are multiple forest uses to consider (scenic areas, wilderness, timber production, recreation, and wildlife designation). As a co-chairman of the Forestry 2000 Congressional Task Force, I am working to provide balance between societal and environmental concerns and the timber industry, specifically in the areas of forest management and health, taxes, endangered species, property rights, funding matters, and public land revisions.
Page 100 PREV PAGE TOP OF DOC Additionally, nothing is more important to the future of our country than the opportunity for high quality education for all Americans. I believe in the value of education, and we must prepare our nation's children for the 21st century. As a member of the House Education and the Workforce Committee, I am actively involved in designing and examining legislation to benefit those who are closest to our nation's students. Those at the local level have the greatest responsibility in educating and preparing our children for the future.
While education is predominantly a state and local issue, many have taken the ''Washington knows best'' attitude and have attached endless strings to Federal dollars. What I hear schools and educators really need is not more paperwork and red tape, but the flexibility to help children more efficiently. Thus, I have focused my attention on assisting state and local governments in providing a quality education for America's youth. One piece of legislation that was recently signed into law is the Education Flexibility Act. This new law will allow states and local governments to use Federal money to accommodate local needs. We must use similar approaches in crafting legislation to address other challenges before us in Congress.
For too long, we have relied on Washington bureaucracies to solve our Nation's problems. It is time to create a more rational approach in addressing issues at the Federal level by basing decisions on what works back at home. With those thoughts in mind, I recently introduced with my colleague Representative Allen Boyd (D-FL), the County Schools Funding Revitalization Act of 1999 (H.R. 2389). This legislation is a locally designed solution to the education funding shortages in communities dependent upon timber revenues.
Specifically, in March of 1999, a national conference of organizations concerned about forest revenue sharing payments and rural socio-economic stability convened in Reno, NV. From this conference emerged the National Forest Counties and Schools Coalition (NFCSC), a unique group of over 500 local, regional, and national organizations in 32 States which share the common objective of strengthening and improving rural schools and forest dependent communities in both the short and long term. The NFCSC has developed a set of joint principles to guide lawmakers in developing legislation to improve forest revenue sharing payments. I urge lawmakers to pay attention to these principals submitted from communities across the country as we work to address this issue.
Page 101 PREV PAGE TOP OF DOC As a matter of background, the National Forest System, managed by the U.S. Forest Service within the Department of Agriculture, was established in 1907 and has grown to include 192 million acres of Federal lands. In addition, the Bureau of Land Management within the Department of the Interior manages over 2.6 million acres of Federal lands.
The Federal Government recognized that, when it secured these lands in Federal ownership, it deprived the adjacent counties of revenues they would have otherwise received if the lands were sold or transferred into private ownership. Accordingly, in 1908 Congress
enacted a law providing that 25 percent of the revenues from National Forests be paid to the counties in which those lands were situated for the benefit of public schools and roads. Similarly, in 1937, Congress established that 50 percent of the revenues from the revested and reconveyed BLM lands be paid to the counties in which those lands were located for similar public purposes.
Since that time, counties adjacent to Federal forests have relied on the compacts of 1908 and 1937 to help finance rural schools and roads and maintain a stable socio-economic infrastructure. In recent years, however, the principal source of these revenues, Federal timber
sales, has declined by over 70 percent nationwide, and payments to many counties have dropped to less than 10 percent of their historic levels under the compact. The corresponding revenues shared with rural counties throughout the country have declined dramatically, crippling educational funding and severely eroding the quality of education offered to rural school children. Many have been forced to lay off teachers, bus drivers, nurses, and other employees; postpone badly needed building repairs and other capital expenditures; eliminate lunch programs; and curtail extracurricular activities. Further, local county budgets have been badly strained as communities have been forced to cut funding for social programs and local infrastructure to offset lost 25 percent payment revenues. As a result, rural communities are suffering severe economic downturns with increases in unemployment, family dislocation, domestic violence, substance abuse, and welfare enrollment.
Page 102 PREV PAGE TOP OF DOC In 1993, Congress enacted a partial response to this crisis by establishing a temporary safety net payment system for 72 counties in Oregon, Washington and Northern California, where Federal timber sales were reduced by over 80 percent to protect the northern spotted owl. To date, Congress has not provided similar assistance to the other 730 counties across the nation, which have suffered similar hardships because of declining forest revenues.
The County Schools Funding Revitalization Act (H.R. 2389), was developed with input and support from the National Forest Counties & Schools Coalition and is a unique compromise endorsed by over 500 education, labor, industry, and county government organizations in 32 states. The bill would restore stability and predictability to the annual payments made to states and counties containing national forest system lands for use by the counties for the benefit of public schools, roads, and communities.
In my opinion, it is clear that the compact of 1908 is broken and needs to be fixed. H.R. 2389 restores stability to the 25 percent payment compact by ensuring a predictable payment level to Federal forest communities for an interim 5-year period. It also requires the Federal Government to collaborate with local community and school representatives to develop a permanent solution that will fix the 1908 compact for the long term. It is my hope that members in Congress will respect the solutions and opinions of our local communities put forth by the National Forest Counties and Schools Coalition. By supporting and passing the County Schools Funding Revitalization Act, together we can fix the compact and restore long-term stability to our rural schools and governments and the families that depend on them.
Again, thank you for the honor to speak before you today. My door is open, and I look forward to working with the subcommittee to develop a solution to this problem affecting our rural counties.
Page 103 PREV PAGE TOP OF DOCStatement of James R. Lyons
Thank you for your invitation to testify on H.R. 2389, County Schools Funding Revitalization Act of 1999 and the administration's proposal, the Stabilization Act of 1999. I appreciate the opportunity to join you today to continue the dialogue that the administration began last year on the need to provide a stable, permanent level of payments, commonly known as the 25 percent fund, and to separate the payments from National Forests receipts. With me this morning is Sandra Key, Associate Deputy Chief, Programs and Legislation from the Forest Service.
In addition to H.R. 2389 and the administration's proposal that we will testify on today, we will also offer our views on a similar bill, H.R. 1185, Timber-Dependent Counties Stabilization Act of 1999.
Administration's proposal, the Stabilization Act of 1999
The administration's proposal will: (1) provide a stable, predictable payment that counties can depend on to help fund education and maintenance of roads, (2) provide increased payments above the payments projected under current law to compensate states for National Forest lands that are not available to the local tax base, (3) provide a mandatory, permanent payment not subject to the annual appropriation process, and (4) sever the connection between timber sales and critically important education and road maintenance needs.
The administration's over-arching reason for proposing this legislation is the need to provide a stable, predictable payment that counties can depend on to help fund their education and road maintenance needs. Under 16 U.S.C. 500, (commonly known as the 25 percent fund), 25 percent of most Forest Service receipts are paid to the states for distribution to the counties in which National Forestlands are located for financing public roads and schools. Historically, the primary source of National Forest receipts has been from the sale of timber on National Forests. Over the past 10 years, timber harvest from National Forests has declined 70 percent in response to new scientific information, changing social values, and our evolving understanding of how to manage sustainable ecosystems. During that same period, payments to states made under 16 U.S.C. 500 have been reduced 36 percent; from $361 million in 1989 to $228 million in 1998.
Page 104 PREV PAGE TOP OF DOC Under the administration's proposal, states will receive the higher of the 1998 fiscal year payment or a new special payment amount. The special payment amount will be 76 percent of the average of the 3 highest payments made to the state during the 10-year period from fiscal years 1986 through 1995 of both 25 percent fund payments and payments under section 13982 of the Omnibus Budget Reconciliation Act of 1993. The special payment amount will not exceed the 1998 FY payment by more than 25 percent. The special payment amount will pay the states approximately $269 million annually, representing an additional $27 million above the existing baseline in fiscal year 2000, $72 million in fiscal year 2004, and $259 million more over the next 5 years.
The special payment is modeled on the formula used in what was referred to as the ''owl county safety-net'' adopted by Congress in 1990 as a provision of the Interior and Related Agencies Appropriations Act. The provision was adopted at the request of certain counties in western Washington, Oregon, and northern California affected by decisions relating to the Northern Spotted Owl. It was renewed annually until 1993 when Congress authorized a 10 year, gradually declining, payment stabilization formula which will expire in 2003. We chose 76 percent of the historic baseline because that was the level of the owl county safety-net payment guarantee when the administration first proposed to stabilize payments over a year and a half ago.
Second, we want to provide a reasonable payment, based on all benefits of National Forest lands, to compensate states for these lands that are not available to the local tax base. Historically, states received payments based on revenues generated from commodity extraction, primarily timber. For a variety of reasons, including new scientific information about the sustainability of our resources, commodity extraction from our National Forests has been reduced. National Forests continue to provide a myriad of benefits to local communities through jobs, income generation, recreation and tourism, timber and mining, and hunting and fishing. Payments made through the payments in lieu of taxes (PILT) are often not appropriated to their fully authorized levels, creating difficulties for counties with a limited tax base due the presence of public lands. Our proposal ensures that states continue to benefit from both the intrinsic value and the economic value of public lands by guaranteeing a payment to make planning and budgeting predictable for counties. Thus, we propose that states receive a permanent, stable annual payment based upon a percentage of historic payment averages.
Page 105 PREV PAGE TOP OF DOC Third, the payment needs to be excluded from the annual appropriation process. We cannot rely on either revenues or the annual appropriation process to produce a consistent, reliable level of funding. The Department's proposal will provide a mandatory, permanent payment to states from the general fund of the Treasury.
Fourth, we must make distinct and separate the social and moral imperative of children's education from the manner that public forests are managed. Both activities, children's education and forest management, are essential, but continuing to make one dependent on the other could continue to reduce funding for some children's most basic education needs, particularly in rural communities.
There has been resistance to this proposal. In part, the resistance may stem from a belief that timber harvest levels will rise dramatically again in the future. This belief is mistaken: (1) timber harvest has steadily declined over the past decade, and (2) in fiscal year 1999 and fiscal year 2000, the administration and both Houses of Congress each proposed as part of the appropriations process timber offer levels that were below 4 billion board feet, including salvage opportunities. It is highly unlikely that timber harvest levels will return to the 11 billion board feet volume of the early 1990's.
Continuing this linkageor tightening it as one of the two congressional proposals before us today would dowill only serve to ensure that payments to states will continue to be tied to controversial forest management issues.
In contrast, separating payments to states, from the receipts generated from the sale of commodities and user fees will allow for a stable, reliable increased level of funding for the states and counties.
H.R. 1185, the Timber-Dependent Counties Stabilization Act of 1999
The administration supports the objectives of H.R. 1185, but will seek amendments to more closely align this bill with the Department's proposal. For fiscal year 2000 through fiscal year 2004, this legislation will provide stable payments to states based on an amount equal to 76 percent of the average of the three highest 25 percent payments made to the state during the 10-year period from fiscal years 1986 through 1995 (special payment amount).
Page 106 PREV PAGE TOP OF DOC In addition, the bill would provide that after fiscal year 2004 each state will make a one time permanent, binding choice of receiving either the 25 percent payment or the special payment amount. This will give states the option to have a permanent, stable payment, not based on revenue generation, or to continue with the decreasing, unpredictable 25 percent fund payments. While this is definitely a step in the right direction, it simply puts off decisions which can, and should, be made today. The administration prefers to ensure that all states receive a permanent stable payment as is provided in the it's proposal.
This legislation also provides for the special payment amount to be adjusted to reflect changes in the consumer price index for urban uses. The Department's proposal does not reflect changes in the consumer price index, but we are willing to work with the Subcommittee to discuss the additional funding that this will require.
H.R. 2389, County Schools Funding Revitalization Act of 1999
Again the administration agrees with one of the objectives of H.R. 2389, that is to stabilize payments, but strongly opposes this bill and, in its current form, is unacceptable for the following reasons: (1) it does not provide a stable payment past 5 years nor does it provide for a mandatory payment to states from the general fund of the Treasury; (2) the funding provisions for fiscal year 200005 payments could create significant impacts on Forest Service programs; and (3) it does not separate payments to states from the contentious, controversial debate over natural resource management of the National Forests, but only fuels this debate by establishing an advisory committee to address issues concerning management of our National Forests.
First, H.R. 2389 would only temporarily stabilize payments to states for a 5-year period beginning in fiscal year 2000. Under this bill, the short-term payments for fiscal years 2000 through 2005 would be the 25 percent fund payment for the fiscal year or the full payment amount, whichever is greater. The full payment amount would be equal to the average of the three highest 25 percent fund payments or the owl county safety-net payment during fiscal year 1986 through fiscal year 1999. This formula would yield a payment that is over $170 million more than the $269 million that is available for the administration's proposal. Since current payment levels equal $242 million for fiscal year 2000, currently projected harvests would need to more than double in order to fund the legislation's higher payments to State levels, or the Forest Service will have to significantly reduce non-revenue producing programs. In addition, after 5 years this issue will have to be addressed again. Assuming this issue will not be easier to resolve, then payments to states will return to the 25 percent fund payments resulting in a significant reduction in funding for education and roads.
Page 107 PREV PAGE TOP OF DOC Second, under the administration's proposal, payments to states will be made automatically from the general fund of the Treasury and will not be subject to the annual appropriation process. In contrast, H.R. 2389 will fund the difference between the 25 percent fund payment amount and the full payment amount from revenues received from activities on National Forest lands and funds appropriated for the Forest Service. Forest Service appropriations that fund programs generating revenues for the 25 percent fund, and funds from trust funds or other special accounts established by statute for specified uses will not be eligible to fund this difference. Under this provision, in fiscal year 2000 the Appropriations Committees will have to either increase Forest Service funding or divert over $170 million from Forest Service programs such as fire suppression, watershed improvement, wilderness, wildlife and fisheries that do not generate revenue. This is neither tenable nor appropriate.
Third, H.R. 2389 will fail to separate payments to states from the debate over the management of National Forest lands. In fact, the bill would only fuel this debate by continuing to make the payment amount dependent on decisions relating to natural resources management. Most significantly, the bill would establish an advisory committee charged with developing recommendations for a long term method for generating payments at or above the full payments amount. The advisory committee will be required to ''seek to maximize the amount of ...revenues collected from Federal lands'' and to ''ensure that this method is in accord with a definition of sustainable forest management in which ecological, economic and social factors are accorded equal consideration in the management of the Federal lands.''
The concept of maximizing revenues collected from National Forests is a fundamental change in Forest Service policy and direction. There is nothing in the Organic Act or National Forest Management Act (NFMA) that requires optimization of revenues. For the last 30 years, Congress has declined emphasizing economic return over natural resource management needs. To do so now is a major reversal to long-standing, carefully hammered out policy. NFMA certainly recognizes the important contributions of economic products from the National Forests, but it also recognizes that such production should be within the ecologically sustainable limits that also preserves our children's economic future.
Page 108 PREV PAGE TOP OF DOC We strongly believe that payments to states for the purposes of funding schools and roads should not be thrust into the debate over the appropriate management of our natural resources.
Since 1908, the 25 percent fund has worked well to provide funding for local schools and roads. But as demands on our National Forests have increased and timber harvest has declined, we need to provide a stable, permanent mechanism for making payments to states.
Mr. Chairman, the Department supports the objectives of H.R. 1185, but we prefer a complete separation between the payments to States and revenue generation from National Forests. The Department strongly opposes H.R. 2389 because it neither provides a permanent stable payment to states nor separates payments to states from the controversial debate over management of our National Forests. As currently written, the Secretary would be forced to recommend that the President veto this bill. However, I hope that as the process moves forward we can work with you to craft an acceptable alternative approach. We recommend that you consider our proposal to provide a permanent, predictable payment that states can depend on to help fund schools and roads. We look forward to working with the Subcommittee to pursue options that might meet our respective goals.
This concludes my statement; I would be happy to answer any questions you and the Members of the subcommittee might have.
Statement of Walt L. Hanline
Chairman Goodlatte and Committee Members: I want to thank you for the opportunity to speak before you on an issue that is vital to our community and our school district. By way of background, the county of Del Norte is a rural county located on the most western and northern portion of the state of California. Economically, it is a poor county. From a poverty level point of view, Del Norte, ranks 54 out of 58 counties in California. As both district and county superintendent, I serve approximately 5,200 students. We are classed as low wealth school district. We have approximately 30,000 residents in our county. Our community and our school district is isolated. The highways that access our community are two lane highways with are difficult to travel. Approximately 72 percent of our land is own by the Federal or state government, most of which is in Redwood National Park, Smith River National Recreation Area, and in Six Rivers National Forest. Recently, as requested by Congress, through the United State Department of Agriculture, and facilitated by the Rocky Mountain Research Station Forestry Sciences Laboratory, a study of the impact of the exclusion of the lands from the local tax role was completed. The study found that the land in our county, if owned privately, would be assessed at $1,229,408,038 and that county of Del Norte, if the land was privately owned, would receive $12,294,080.38 in annual property taxes (Note Appendix A). In essence, because of actions taken by the Federal Government, we live a very remote and beautiful area with very limited economic opportunity. For the sake of time, I have chosen not to read the next five paragraphs highlighted in italics and would request that you review them at your convenience.
Page 109 PREV PAGE TOP OF DOC Our county has a history of testifying before Congress. For the sake of a perspective, I would like to refer to testimony that has previously been provided to Congress . . . Del Norte County Supervisor, Mr. Byron Justus, testifying before the Senate Subcommittee on Parks and Recreation in 1976 (publication No. 9585) stated, ''When the original redwood park was created in 1967, one of the greatest concerns of local public officials was the loss of jobs and the tax base, as well as the ultimate effect on the economics of Del Norte and Humboldt Counties'' In 1971, seventeen saw mills existed in our county and today we no longer have a saw mill in our county. Mr. Justus aptly stated a fact that continues to today, ''Finally, the report accompanying S. 2515 of October 12, 1967 confirmed that U.S. Senate's intention to support the promises made by Chief Cliff (Forest Service Chief) regarding the timber sales on the Six Rivers National Forest. Unfortunately, these promises were never kept. This national forest which was committed to multiple use, including timber harvesting, has never been developed.'' I would encourage the committee to read the rest of Mr. Justus's testimony. It will begin to give you a sense of how the actions of the Federal Government terrorized the economic well being of our community. Mr. Gerald Cochran, Del Norte County Assessor, testified before the Subcommittee on Public Lands on March 4, 1983, and stated, ''...to show that Congress was mislead in testimony for both the original and the expansion of the Redwood National Park, I submit that, in the testimony of 1977, it was estimated that park visitation...would be 2,500,000 visitor days. Well, let me give you the reality of the situation. The 12 months ending September 30, 1982 produced 39,958 visitor days.'' To say the least, our community has felt abandoned, ignored, and isolated.
In 1891, Congress extended to the President the authority to reserve certain lands containing forests as Forest Reserves. The Organic Act of 1897 provided an affirmation of the 1891 legislation authorizing the Forest Reserves, and extended the area open to such withdrawals to large areas of the western United States. These lands were transferred to the jurisdiction of the Forest Service in 1905.
Page 110 PREV PAGE TOP OF DOC These Forest Reserves (National Forests) were created ''to improve and protect the forest within the boundaries and for the purpose of securing favorable conditions for water flows, and to furnish a continuous supply of timber for the use and necessities of citizens of the United States . . . 11 (16 USC 475). Representatives and Senators of the States impacted by these Reserves strenuously objected. The criticism and concern at that time, as quoted from a Gifford Pinchot (1907) U.S. Forest Service publication was, ''If these lands were left open to pass into private hands, there would be much more taxable property for the support of school and road districts.''
In 1908, the Agricultural Reapportionment Act created a mechanism to fairly compensate counties and schools for the loss of revenue resulting from establishment of the National Forest Reserves. Ten percent of the net receipts from the National Forests were to be distributed to counties for use of roads and schools. In 1911, the Weeks Law amended the percentage to 25 percent of the net receipts. Until the late 1980's, this mechanism worked exceptionally well as a means to compensate counties and schools for the loss in local revenue production due to National Forests.
As you know, in the mid 1980's, we began experiencing a distinct shift in our national vision regarding the use of the National Forests. Consequently, the revenue loss mitigation mechanism created in 1908 quit functioning as intended. Actual mitigation revenues no longer approximated the revenue production value of these lands. The Forest Reserve Receipts for our county plummeted from a high of $3,702,092 in 198990 to a projected low of $1,425,101 in 2001/02 (appendix B). The impact to our district is a loss of $1,138,486 to serve our students. To provide a perspective, as the new first year superintendent, I was faced with a $750,000 deficit due to the continued decrease in our funding. We increased class sizes to 29 students, reduced support staff, and eliminated nine teaching positions. This does not reflect the reductions that have taken place earlier and the disastrous impact on our facilities.
Page 111 PREV PAGE TOP OF DOC Today, the cost of roads and schools are increasing, while revenues to counties are declining. In fact, with increasing levels of recreational use, and the economic travail and social disruption being experienced by forest county communities is increasing the need for adequate roads and school systems has never been greater.
Del Norte County is the site of the Smith River National Recreation Area (SRNRA). Our county road system provides access to this nationally recognized resource area. The attached information sheet and map (appendix C) shows that 42.5 percent of the county maintained road system provides either direct or indirect access to these Forest Service Lands. The continuing decline, and future (year 2003) precipitous decline in Forest receipts to the county roads will place the county in the unfortunate position of no longer adequately maintaining this road system within the Smith River National Recreation Area. This will lead to unintended environmental impacts and will further negatively affect any economic opportunities for this county to capitalize upon the existence of the recreation area as intended in the original actions of Congress.
Public schools and counties in forested areas of the United States need immediate relief from the effect of plummeting U.S. Forest service 25 percent payments and BLM timber sale receipts. Schools and counties no longer have the revenue necessary to provide for essential programs and services to families and children.
I cannot communicate strongly enough the dire circumstances faced by our rural schools and counties. We strongly urge you to recognize the urgency of this matter in Del Norte County as well as other forest counties. We ask for your support and efforts on our behalf of our community. Congress must take action to enact a short term safety net bill which also contains provisions for initiating a long-term and balanced solution to these problems.
Statement of Mark Evans
Page 112 PREV PAGE TOP OF DOC My name is Mark Evans. I am the county judge of Trinity County, TX.
I also serve as president of the North and East Texas County Judges and Commissioners Association, which has 66 member counties. At our recent annual conference, the North and East Texas Association passed a resolution in full support of the principles of responsible management of our national forests adopted by the National Forest Counties and Schools Coalition. I would request that a copy of this resolution be entered into the record as part of my testimony.
Trinity County is located in the eastern part of Texas and contributes over 67,000 acres of land to the Davy Crockett National Forest. This acreage is some of the best upland sites for the production of pine timber anywhere. As part of the Davy Crockett National Forest, this acreage is not on the tax rolls nor is it available for development.
For decades there has existed a compact between the U.S. Forest Service and the counties and school districts. Twenty-five percent of the revenues from the harvest of timber on National Forest land in each county have been returned to the counties to be shared with the local school districts. This 25 percent is divided equally between the county and the local schools. The county share is used exclusively for road and bridge operations and in the past has made up about 40 percent of Trinity County's road and bridge budget. In the last three years Trinity County's 25 percent of national forest receipts have declined from $1,033,381 in 1996 to $90,409 in 1998. It is anticipated that our 1999 share will be even less than last year. This loss can only be made up by a cut in services or by raising taxes. Frankly, neither of these two options have much appeal.
In talking with administrators from the Trinity County Schools, it is apparent that National Forest revenues have enabled our rural school districts to provide the type of quality education to their students which is on a par with that provided by wealthier and urban school districts. Revenues from the National Forest lands have also been instrumental in school modernization, in the construction of athletic facilities, and in keeping the schools' physical plants in good condition.
Page 113 PREV PAGE TOP OF DOC But there is another effect of the decline in national forest harvest, one that has a personal impact. We have talked about the loss of revenues that the schools and counties face. But the impact on the local economies must be realized. This is the human effect and it will ripple through the timber and logging industry. For each $500,000 returned to the counties to share with the schools, there must have occurred two million dollars of actual timber production and receipts from the national forest in that county. That $2 million means jobs and help to fuel our local economies, which have been tied to the timber industry for generations. A check or a payment from the Federal Government to the counties and schools does not have the same effect that actual harvest in the national forest does for the local economy.
I believe the bottom line is this: the U.S. Forest Service should follow their own management plan. If it would, the decades old compact between the Forest Service, the counties and schools would be fulfilled. The National Forest system would be properly managed in an environmentally responsible manner, the Forest Service timber program would be a profit for taxpayers not a loss, the timber industry would help to fuel our local economies, and future generations would be assured that the management of the national forest system would be true to the principles of its establishment.
Testimony of Claire A. Collins
My name is Claire Collins. I serve as county administrator of Bath County, VA located in the central western portion of the Commonwealth of Virginia, referred to as the Alleghany Highlands, bordering Virginia and West Virginia. -Bath County has a population of 4,799 residents in 540 square miles with the George Washington National Forest lands being 52 percent of the county.
On behalf of Bath County which is a member of the National Forest Counties & Schools Coalition, I will comment on the merits of both the proposed County Schools Funding Revitalization Act of 1999 (H.R. 2389) and the draft of The Stabilization Act of 1999 (the administration's proposal) as to how each proposal would effect rural counties. Historically, rural counties such as Bath have and continue to fund education as their top priority in order to provide young citizens with tools necessary to compete in a global market and for each generation to be a part of the ''American Dream.'' In 1908 when Congress enacted a law providing 25 percent revenues from National
Page 114 PREV PAGE TOP OF DOCForests to be paid to counties in which Federal lands existed to be spent on public schools and roads, rural counties were able to utilize the revenues to adequately fund schools. In recent years, the principal source of these revenues, Federal timber sales, has declined by over 70 percent nationwide. In Bath County, for example, as of year ended June 30, 1999, we received $133,310.66 of these revenues for public schools with school operational expenditures of $7,471,355.76, making the forest revenues only account for 1.8 percent of the schools operational budget. Thus, local citizens in Bath County and other counties throughout the United States with Federal forest lands are bearing the tax burden to fund public schools.
This is an unfortunate situation because if a county does not have adequate revenues to fund education, then young citizens are missing out on learning opportunities and job preparation. H.R. 2389 is the first step in bridging this education gap by providing assistance to rural counties across the Nation to ensure that the 1908 legislation is followed with appropriate revenues sent to counties. Establishing a
temporary 5-year payment formula for counties receiving revenue-sharing payments from Forest Service and Bureau of Land Management lands with full payment amounts to each eligible state or county based on the average of the three highest annual payments received between fiscal year 1985 and the date of the bill's enactment would greatly improve counties' revenues. Also, developing a long-term solution to the current revenue sharing programs through formation of a Forest Counties Payment Committee charged with developing policy and/or legislative recommendations to Congress within two years would provide for the collaborative and partnership efforts needed in rural communities to increase revenues, promote the economy, and ensure sustainable forest management.
The proposal offered by the administration suggests a permanent annual appropriation to States and counties from the Treasury that amounts to 76 percent of the average of the three highest years since 1985 that would not exceed an increase of 25 percent of the 1998 receipt levels. The administration proposal also stresses the philosophy of administration officials that payments to counties and schools should be removed from the debate about management of Federal forest lands. This proposal fails to address the need for a short and long term solution to decreasing revenues to counties with forest service lands or for administration officials to work in partnership with counties toward the goal of economic stability and enhancement.
Page 115 PREV PAGE TOP OF DOC Rural counties with forest lands have witnessed in recent years the demise of administration officials involvement in community problem solving and know that payment mechanisms such as Payment In-Lieu of Taxes (PILT) have been inadequately funded over the years. In Bath County, the Board of Supervisors continues to make increasing PILT a Federal legislative priority and appeals Forest Service decisions on timber sales and trail relocations. Instead of the administration working with rural counties, there seems to be a belief that rural counties accept whatever the administration states or proposes. There is a dire need to engage in collaborative and problem solving efforts for the economic and social stability and enhancement of rural schools and counties.
In closing, it is clear that H. R. 2389 restores stability to 25 percent payment for an interim 5-year period along with a mechanism for a long-term solution to reaffirm the 1908 legislation. Also, it is clear that the administration proposal fails to provide for an equitable and collaborative solution. No incentives exist in the proposal to ensure that actively managed Federal forest lands will revitalize and restore the economic and social stability of rural counties.
"The Official Committee record contains additional material here."