Don’t take my PILT down, man

Calf Creek Canyon in Grand Staircase-Escalante National Monument.

Calf Creek Canyon in Grand Staircase-Escalante National Monument.

There’s nothing wrong with PILT (Payment in Lieu of Taxes) that getting rid of the need for PILT won’t fix. But so long as there’s a “in Lieu of Taxes,” getting rid of “Payments” would be fundamentally unfair and harmful to Western counties and states. And yet, that seems to be where we’re going.

PILT was created in the 1970s to offset the revenues that counties – mostly in the West – lost due to tighter environmental regulation on federally owned lands.  It was a “make ’em an offer they can’t refuse” scenario where the federal government said they would offset lost tax revenues with direct payments that the counties could then use to pay for their schools, public safety, and all of those boring things. In other words, the counties were “asked” to trade economic independence and good jobs for an annual check from Uncle Sam.

This may not seem like a big deal to states east of the Rocky Mountains – you could add up all of their PILT payments combined and it wouldn’t equal the payments that go to any two Western states. But if your county is 90 percent (or even 98 percent) owned by the federal government it’s easy to imagine that having no property or income taxes coming off of those lands can have a significant impact, not just to counties’ coffers but to their way of life.

And that seems to be the direction we’re going. The recent omnibus (D.C.-speak for “too big for anyone to read”) spending bill cut PILT payments to … nothing.

PILT, you see, is entirely discretionary, making the “deal” made back in the ’70s entirely dependent upon the continuing goodwill of people who have no idea what it is, who it’s for, or why it’s important. Western congressional delegations all swear that this is just a temporary oversight and it’ll get back into some type of legislation – and they’re probably right, for now – but as non-defense discretionary spending items continue shrinking to pay for growing entitlements, things like PILT will inevitably face a sharper and sharper ax.

This comes as a double whammy as oil and gas royalty payments from federal lands are being “adjusted,” too. The deal there has always been a 50/50 split between the feds and states on royalties from oil and gas taken off federal lands. Our partners in D.C., however, have unilaterally decided to impose an “administrative fee” that results in a 51/49 split, with you-know-who getting the 51 percent.

What’s the big deal, you ask? Wyoming might care. They’re set to lose nearly $20 million next year. The cuts affect 35 states, the largest five of which are in, you guessed it, the West; and except for California the Mountain West specifically. I’m not too worried about California. It’s big enough to take care of itself – it just chooses not to.

But in states where well over 50 percent of the land is owned by the federal government, making economic diversification difficult at best, taking the most important tool out of their toolbox and then not paying for it is, well, like taking away someone’s tools and not paying for them. It denies them the opportunity to take care of themselves, their families, and their communities.

So, back to the first paragraph where I said that there’s nothing wrong with PILT that getting rid of the need for PILT won’t fix. How do we get rid of the need for PILT and therefore make Mountain West states less dependent on D.C.? We give control of those lands back to the people who have managed it, tended it, and raised their families and communities on it for generations.

 

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2 Responses to Don’t take my PILT down, man

  1. Pingback: Don’t take my PILT down, man | Sutherland Institute

  2. Michael Gordon says:

    In states without significant federal lands your personal freedom to travel is seriously reduced. For instance, in Washington State you cannot legally walk along most beaches since private land often includes the beach.

    http://funbeach.org/blog/public-beach-access-whats-legal-whats-not/

    Back east nearly every square inch of land is owned by someone. Finding a mountain to climb or a forest to walk through is an ordeal. I used to drive several hours to reach Stony Man Mountain in Shenandoah just to have a trail to walk on that was not also filled with two-legged predators.

    Here in Utah, “BLM” land, along with National Forest, is largely free to explore. Our liberty on that land is really exceptional and I think somewhat taken for granted especially by gun-toting, sign-shooting Utanians. But I prefer it over the acre-by-acre jealously guarded private lands found almost anywhere else.

    Should some of that land be in state hands rather than federal? Maybe; but cronyism would invariably raise its ugly head leading to a gradual transfer of state land into privileged private hands.

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