FILE - In this undated file photo, a large fir tree falls to the forest floor after it was cut by an unidentified logger in the Umpqua National Forest near Oakridge, Ore.
Don Ryan / AP
For decades, rural Oregon counties that contain large swaths of federally owned forest land have depended on a share of timber revenues from federal logging to fund schools, law enforcement and other essential public services. These payments were originally meant to offset the loss of property tax revenue that counties could not collect on federal lands. But when logging on these lands slowed drastically in the 1990s due to new environmental protections — like the Endangered Species Act — those payments plummeted.
In response, Congress stepped in with a temporary fix: the Secure Rural Schools Program. First passed in 2000, Congress reauthorized it multiple times over the years until it allowed it to expire in 2023. The lapse in reauthorization has triggered the default distribution of the significantly reduced timber revenue to counties.
The federal budget process has introduced new complications as well. President Donald Trump’s One Big Beautiful Bill Act, which was signed into law in July, requires federal agencies to ramp up logging. But it also includes a provision redirecting all proceeds from timber sales on lands in counties to the federal government — threatening one of the last fiscal lifelines for rural governments to fund its core services.
With counties facing budgeting shortfalls that carry big consequences, questions about how to create a long-term sustainable path forward have taken on new urgency. Lane County Commissioner Heather Buch and Klamath County Commissioner Derrick DeGroot — whose counties receive the second- and third-highest federal payments in Oregon after Douglas County — join us, along with Mark Haggerty, a senior fellow at the liberal-leaning thinktank Center for American Progress to talk about the challenges Oregon’s rural counties face and what a stable funding model for these counties might look like.
Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.
Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. For most of the 20th century, rural Oregon counties with a lot of federally owned forest land depended on a share of timber revenues from federal logging. That money funded schools, law enforcement and other essential public services. When logging on these lands slowed in the 1990s, due to environmental protections, those payments plummeted.
So Congress stepped in with what was supposed to be a temporary fix: the Secure Rural Schools Program. The money from that program became a crucial lifeline for many Oregon counties. And while those payments were reduced over time, they were almost always renewed – up through the 2023 fiscal year when they finally lapsed. That was a big blow to rural counties. The One Big Beautiful [Bill] Act was another blow. First of all, it did not reauthorize those payments, but it also slashed money that counties were getting from timber sales.
We’re gonna hear what this means for two Oregon counties right now. They’re going to talk about possible solutions as well. Derrick DeGroot is a Klamath County commissioner. Heather Buch is a Lane County commissioner. They both join me now. It’s great to have both of you on Think Out Loud.
Derrick DeGroot: Thanks for having me.
Heather Buch: Great to be here.
Miller: Derrick, what have federal payments, whether from timber receipts or instead of them, meant for Klamath County in recent years?
DeGroot: The SRS [Secure Rural Schools] has provided, this budget year, 100% of the funding for the patrol function of our sheriff’s department.
Miller: One hundred percent of sheriff’s patrol came from Secure Rural Schools at those federal payments?
DeGroot: Right. There’s a small contract with the Forest Service/Bureau of Land Management and then the school districts for some protections there. So outside of those contracts, the actual patrol function of our sheriff’s office is funded exclusively by SRS payments.
Miller: Is there money left over for other government services or is it as simple as patrol functions in Klamath County that comes from this replacement of timber revenue?
DeGroot: No, the Title I portion of our payment, after the percentage that goes to the general school fund, was around $4.4 million. The total budget for the patrol function is $5.5 million. So we were able to find some additional funding from prior SRS payments to put towards that. But it is still nowhere near enough.
Miller: So that’s the hit that you’re looking at right now, around $4.5 million?
DeGroot: Well, no, it’s probably around $4 [million], maybe $4.2 [million]. We will receive some payments for … And I think it’s important to remember there’s two different sides for both Lane County and Klamath County. We have O&C [Oregon and California Railroad lands] SRS payments, and we have those that are derived from the Forest Service lands. So that’s specifically just speaking about the Forest Service lands and not on the O&C lands.
Miller: O&C – Oregon and California – this very specific piece of history. What was going to be a railroad that never happened, turned into this patchwork of public and private land like a checkerboard. And although some of that, a tiny percentage of that, is also Forest Service land? Am I right that most of it is controlled by the BLM?
DeGroot: That’s correct, yeah.
Miller: Heather Buch, what about Lane County? How much have you depended on revenue, in some way, from federal land in the last couple of years?
Buch: It’s been a huge part of our general fund budget. In the last allocation, in 2021, Lane County received about $7.8 million and we have traditionally split that money of 50/50 between patrol and roads.
Miller: How much of that money are you expecting to get in some way or another for the next couple of years?
Buch: Well, we’re not expecting any more SRS money unless we see some kind of movement on reauthorization. The reauthorization ended last year and we reverted back to receipts that flow to the counties from harvest on BLM and U.S. Forest Service land. But those receipts are just a few hundred thousand dollars a year. So we won’t budget for SRS money in the future, unless we have some kind of reasonable reassurance that it will be coming.
Miller: What’s that going to mean in terms of staffing?
Buch: Well, for our sheriff’s office, in the last authorization, the 50% that went to the sheriff was the equivalent of six patrols and two detectives over the course of five years. And to put that in perspective, we really only have 30 positions in our main office patrol now. So those will be ending and we won’t have that patrol on our staff anymore.
Miller: So about a quarter of the staffing in the sheriff’s department in Lane County had been paid for with this SRS money, these timber payments. And with that going away, there’s no way right now to replace it?
Buch: That’s right.
Miller: What options do you feel like you have right now as a county?
Buch: Well, our only option really is to advocate to our federal representatives. We don’t have the jurisdiction to make the change. And although this funding was included in the last budget cycle in Congress on the House side, when it went to the Senate side, it was removed from the budget bill.
So what we need to do is remind those senators that this is so crucial to county budgets. And [these are] things I think everybody, regardless of your political affiliation, really want to see in county services.
Miller: Derrick, I’m curious what you’ve been hearing from your constituents in Klamath County about this?
DeGroot: That’s a great question. I think, for the most part, you have a citizenry that pays attention most of the time after there’s an impact. So the impacts of not funding SRS and/or some type of a replacement through receipts has not affected them yet. I think that they are starting to learn that the amount that we’ve received from SRS over the period of its life has dramatically decreased. They’re seeing how we’re having to continually cut back services year over year over year. In the last 20 years, it’s dropped by 69%, so it’s nowhere near the level of service we were once able to provide.
Miller: I want to go back to what you were saying before. It’s so important that I want to get into it, even though one of the challenges in these conversations is just the jurisdictions, the overlaps and the different rules for different agencies. It’s confusing to talk about in a radio conversation but too important to ignore.
So to go back to this sort of patchwork of land ownership and management, even within federal land. Some land that we’re talking about is managed by the BLM and some by the Forest Service. What does that mean right now in Klamath County, in terms of the money you could get from timber sales themselves?
DeGroot: The amount that we would have received from timber sales versus the amount that we would receive from SRS, on the O&C lands that are managed by the BLM, is almost neutral at this point. They’re almost the same.
Miller: Almost the same and, basically, almost nothing?
DeGroot: Yeah, so fiscal year ‘23, Klamath County received only $750,000. This year it’ll be roughly the same if it’s based on receipts. It may be a little bit less because harvests have not hit targets. But if we are able to bring those to at least where we’re successful in hitting those targets, it would be about the same.
Miller: And what about Forest Service land?
DeGroot: Forest Service land is entirely different, specifically for Klamath County. So our Forest Service lands are predominantly on the east side of the Cascades where they’re not as productive lands. And the amount of timber milling capacity is significantly less than it is on the west side of Oregon.
Where we have excess milling capacity on the west side of Oregon – meaning that they can take and process logs that come off of federal lands – on the east side of Oregon, that’s not necessarily the case. So the mill closures have been staggering. In Eastern Oregon, 20 years ago, there were 69 mills. Now there’s gonna be four. That doesn’t include Klamath County. We have about four ourselves. But it’s pretty significant.
Miller: For another perspective on this, we are joined by Mark Haggerty. He’s a senior fellow at the left-leaning Center for American Progress. He’s been studying this issue for decades. Mark, welcome to the show.
Mark Haggerty: Hi, thank you very much.
Miller: I gave the short version of this in my intro, but why was the Secure Rural Schools program started about 25 years ago?
Haggerty: To go even further back, when Gifford Pinchot and Teddy Roosevelt were first setting up the National Forest, they recognized that a lot of rural communities didn’t have resources to support local schools, roads and sheriff’s departments – the kind of services that the Commissioners have been talking about.
The new federal lands that would be retained would be non-taxable. So they established a really important partnership in 1908 to share revenue, from timber sales and other types of commercial activity on public lands, with local governments so that they could pay for services. Over time, as public land management has changed, as the economy has changed, Congress has made a bunch of different programs and appropriations to try to deal with those changes.
When timber harvest declined in the 1990s, in response to the Northwest Forest Plan, Oregon payments declined significantly. So Congress stepped in and created the SRS program which used appropriations to backfill the payments that those counties were losing from timber receipts.
Miller: My understanding is it was framed as a temporary solution 25 years ago. And it has been reauthorized most years, I think not in 2016. Although as we heard from Derrick DeGroot, the payments themselves have definitely shrunk over the two-and-a-half decades, the idea was for it to be temporary. What did policymakers say or hope would replace these payments?
Haggerty: Well, it kind of depends on who you ask. One belief was that the challenges of the Northwest Forest Plan and Endangered Species [Act] would be temporary, and the agencies would come up with management plans and effectively allow for timber harvest to begin again in some different scale, but a return to the revenue sharing programs was possible.
Another side said that we weren’t ever really gonna go back to that, but counties would have the ability to diversify their economy and find other ways to generate revenue from property taxes and local services. So there was actually a really big economic adjustment part of the Northwest Forest Plan too, that gave workforce training grants and economic diversification funding to counties to help them transition.
I think it’s important to say that neither one of those things has happened in a lot of Oregon’s rural counties.
Miller: Derrick DeGroot, what do you see as long term fixes? I still want to dig deeper into the current political climate, and what you and Commissioner Buch are hoping for this year or in the coming short number of years. But just to look at the longer term picture here, what do you see as a longer term solution?
DeGroot: I think that depends on what lands that you’re talking about. I just got back from [Washington,] D.C. where 40 of my colleagues and I went and met with 80 different members and agencies, specifically to talk about this program, along with the Payments in Lieu of Taxes [PILT] program. I think that we made a great bit of headway. I think on our Forest Service lands, Secure Rural Schools, it needs to be some type of permanent fix there. I don’t know if you’re looking across the 700 or so counties across the country, that you’re ever going to be able to solve that, away from some type of federal appropriation.
On the O&C lands, I do believe that there is probably a pathway that those lands, along with the much different revenue sharing formula that comes with those receipts, could still provide for that portion of county budgets.
Miller: What is it that gave you hope? If I hear you correctly, you had those meetings last week with dozens and dozens of lawmakers … you, along with a bunch of other, I guess, county or local officials pleading your case. What gives you hope from what you heard?
DeGroot: I think what we heard resoundingly, with the 80 or so members we spoke with, the large majority of them were supportive of the program, looking for the funding, were willing and committed to diving into finding the funding to reauthorize the program. We heard it from our own representative, from the speaker’s office and everybody else who we spoke with.
Miller: Mark Haggerty, what do you see as a long-term solution right now?
Haggerty: So, Commissioner DeGroot, I saw you in D.C. last week and didn’t get a chance to say hi. But Senator Wyden was there and he made a strong commitment to trying to reauthorize Secure Rural Schools. But he also noted that he wants to take another run at a permanent funding fix. Effectively, what that would do is create a new endowment, a permanent fund at the federal level.
So instead of spending receipts on an annual basis from commercial activities, they would get saved and invested in a permanent fund. That permanent fund would make stable and permanent payments to counties. Also, payments would be rising over time, so kind of reversing the trend of declining payments that the Commissioners have noted.
And importantly, it’s also revenue neutral. So you’re not gonna have to ask taxpayers in the future to keep appropriating money, so it kind of solves the two problems. One, that it’s difficult to go to Congress every year and try to get them to reauthorize these programs. Commissioner Buch said it’s not a partisan issue, which is correct. It’s a provincial issue. It’s hard for counties in Oregon and Montana – where I am – or Wyoming, to make the case nationally for why they need these payments.
Miller: Right. You can call it revenue neutral, but how are you going to make the case to lawmakers in Kansas, New Jersey or Vermont that a relatively large number of counties – many of which don’t have a ton of people compared to, say, the East Coast – that it’s people in these counties that should get a permanent endowment? How do you make that political case?
Haggerty: Well, it’s a million dollar question. I think one of the important things that’s come out of the One Big Beautiful Bill Act is how important public lands are, not just to the people who live around them and use them every day but to the nation as a whole.
And if we want to keep our public lands, we need to take care of them. But we also need to be partners with the communities around them. So finding a way to make sure that communities that live near public lands can afford to pay for services, can afford to have an economy that actually works and functions around multiple-use lands, we need to make a commitment to them as well as protecting public lands for the nation as a whole. I think that’s part of the answer here.
Miller: Derrick DeGroot, what do you think of this permanent fund idea?
DeGroot: It’s interesting and I like the idea. I do want to, again, bifurcating the two different sets of lands … Oregon is unique in these 18 counties that host the O&C lands and I think it’s a separate conversation. But I do like that conversation surrounding the Forest Service lands, until such times as those forest lands can pay for themselves.
And Mark’s completely right that you have these host counties that host these lands that once provided for the communities that hosted them. And they were an asset. They’ve become now a financial liability. We host these lands so that visitors from across the country – to fill in on your other question about why somebody from Kansas would care – come out and they visit these lands. They hike, they bike and they visit these lands. And they also expect services when they get here.
Those services aren’t provided for by the federal government. They’re provided by the local government, whether that’s search and rescue, emergency services or roads that allow them to access those lands – those are all provided by us. So we need to be able to be well funded and have thriving communities so that when you show up from Kansas, you have a good experience and you have a safe one.
Miller: Commissioner Buch, I want to go back to you in Lane County. My understanding is that you put together a Public Safety Funding Task Force. What has come from that?
Buch: We did. It lasted about a year, and after that year, they came to the Board of Commissioners with a final report, really outlining what it would take in order to have a minimum level of sheriff’s patrol and some DA services associated with that patrol. And what it really stated is there are three levels that we could potentially go out to the community and ask what they would be willing to have as resources in order to fund these patrols.
So really, the onus of the SRS funds is now, in essence, being faced at the local community level and we are already critically short of sheriff patrol as it is. This will, of course, make that even more critical. And we’re trying desperately just to keep 24-hour service with three patrol, at any given point in time, for the entire county.
We just need to have a community conversation. And a lot of people are telling me they’re not gonna be able to afford any more taxes. And without the SRS payments, we’re not gonna be able to fill the gap. We’re seeing budget cuts come through the federal and state level. This is just one of a large budget gap that we’re starting to see.
Miller: Derrick DeGroot, how do you think about that question in Klamath County, of the extent to which any of this hole can be filled with an increase in local property taxes?
DeGroot: We actually ran an initiative just for the east side of Klamath County and tried to create a policing district there just this last May – and it failed spectacularly. I think it was 70/30 or something like that. And resoundingly, we’re hearing that same sentiment from around the community.
So I believe that any local tax levy for public safety today in Klamath County would fail. The citizens just aren’t willing to have that conversation. Perhaps if we get to a point where we’re like some of our other colleagues across Oregon that have had to shut down patrol services, maybe at that point there’s a different conversation … I don’t know.
Miller: I’m reminded a little bit of Josephine County, where voters, over and over, said no. What lessons do you take from their experience over the last 15 years, 10 years?
DeGroot: A glimpse into the window of our future is what I see.
Miller: What do you mean by that?
DeGroot: If SRS were to fail … and I will say right now I’m extraordinarily hopeful. Based on the conversations I had last week, I would put funding at an 80% chance of happening for reauthorization of SRS, maybe even a little bit better. But should that not happen, I believe we’ve taken a few bites of this apple over the course of the last 18 months to get it reauthorized, and it hasn’t happened yet.
So should it fail, Klamath County would soon have to shut down those services. There’s no other method with which we could fund ‘em. Once the citizens experienced what it’s like to live without law enforcement presence, perhaps that changes the way we have the conversation.
I don’t know, but I do believe that when you look at Josephine County and others that have gone through this, it is a glimpse into the future of most rural Oregon counties, if it is not for a stable, reliable, predictable funding to provide for those services. And by the way, not in the same manner that it’s been done for the last 20 years, where it has declined by such an extraordinary amount, but rather keep up with the cost of providing those services.
Miller: Derrick DeGroot, Heather Buch and Mark Haggerty, thanks very much.
All: Thank you.
Miller: Derrick DeGroot is a commissioner in Klamath County. Heather Buch [is a commissioner] in Lane County. Mark Haggerty is a senior fellow and the Center for American Progress.
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