Sep 062013

By Nick Worth
The U.S. Forest Service (USFS) has announced it will cut more than $860,000 from the amount it pays the State of Arizona for lost timber sales revenues under the Secure Rural Schools and Community Self-determination Act. The figure is part of more than $15 million that will not be paid to 22 states.
The monies paid to the states under the Secure Rural Schools Act is supposed to compensate the states and their individual counties for revenue lost because of federal government imposed restrictions on logging. The program has been active since 2000 and was scheduled to pay out $346,275,000 in fiscal year 2012.
The funds are transferred from the state to every county in the state that includes a National Forest within its boundaries.
A letter from USFS Chief Thomas Tidwell was sent out to governors around the country Aug. 19, saying money would be taken out of the payments to the states to meet the demands of federal sequestration in the USFS budget.
The USFS originally demanded repayment of the funds in March of this year and states were told if they did not pay up, the money would be subtracted from their 2013 payments.
Arizona will be hit with a cut of $861,351.95 from its timber payments, leaving $1.1 million to be disbursed to the counties.
According to Navajo County Finance Director James Menlove, the loss to Navajo County schools has not yet been quantified.
“The impact would be significant,” said Navajo County Superintendent of Schools Linda Morrow. “It would be a significant loss to all of our districts, but the four forested districts would see a very significant impact.”
Morrow said the Blue Ridge, Show Low, Snowflake and Heber-Overgaard school districts would be the hardest hit since those four districts have a portion of their area in National Forest. According to Morrow, the states began receiving money from the sale of timber on their federal lands during the administration of Theodore Roosevelt in 1908.
Among the states affected by the USFS decision, Oregon faced the most severe cuts with $3,951,295.09 taken back by the Forest Service. North Dakota lost the least amount, with a bill of $32.13.
Arizona is seventh in the amount of the cut it is sustaining, behind Oregon, California, Idaho, Washington, Montana and Alaska.
The Forest Service received refunds, or withheld approximately $17.8 million from 41 states and Puerto Rico.
The move by the USFS has not gone unopposed, though. The Western Governors’ Association (WGA) sent a letter to Agriculture Secretary Tom Vilsack last May, protesting the USFS demands for the return of the money. The USFS is under the control of the Department of Agriculture.
In the letter, the members of the Governors’ Association say the federal government does not have the legal right to take back money that was allocated to the states before sequestration took effect.
“Further, although it was not mentioned in the advice letter, we have learned that the USFS plans to assess interest, penalties and administrative costs on sequestration amounts if states do not remit payment,” the governors wrote. “The (2011 Budget Control) act does not include language authorizing retroactive application of the spending reductions or limitations. Nor does it contain language requiring reimbursement of funds that were already distributed in order to satisfy spending limitations.
“Western Governors ask the USDA/USFS to provide us written response to the following questions,” the letter states.
* Upon what specific legal authority does the USFS rely to justify its demand that states return obligated and distributed fiscal year 2012 funds in fiscal year 2013?
* Upon what specific legal authority does the USFS rely to justify imposition of the full sequester cuts solely on Title II funds?
* Are states subject to interest charges or punitive measures if funds are not returned? What would be the legal basis for these charges?”
According to the WGA, the Department of the Interior reversed its decision in a similar plan that withheld mineral royalty payments to Arizona and 33 other states. The DOI announced Aug. 19 that it would repay what it had deducted from the states’ mineral payments and would not seek any deductions next year. The WGA said states use the royalties to fund the likes of infrastructure, education, flood protection and a variety of other projects.
Morrow said it is up to the individual school districts in Navajo County how they use the money.
“What’s nice about that money is they can use it to replace or repair equipment, or for teachers’ salaries,” Morrow said. “It gives them some funds to use as they want.”
She said some of the money goes to every school district in Navajo County, but the four forested districts get the lion’s share of the funding.
Morrow added that only 16 percent of Navajo County is private land.
“We need people to understand it’s not the same as other counties where there is a lot of private land being taxed,” she said. “It (the Secure Rural Schools Act money) provides discretionary funds for emergency uses, like one time repairs.”