Pocketbook pile-on 

Drowning Government

Flathead County got a double dose of bad budget news in the past two weeks.

In the first week of December, when the U.S. Congress went into recess, it allowed the Secure Rural Schools and Community Act of 2000 (SRS) to expire. When an original version of the legislation became law in 1908, it redistributed 25 percent of revenues earned on national forests to states and counties in lieu of taxes that would have been paid if those properties were privately held. In 2000, Congress replaced the original bill with SRS, which maintained funding at historical levels as national forest revenues declined.

Flathead County received $1.5 million through SRS in 2006.

Of that, $900,000 went to the county road and bridge department, providing one sixth of the department’s budget. Nearly all the rest went to state and county schools.

According to County Road and Bridge Superintendent Charlie Johnson, his department is already in bad financial shape.

Right now, he says, either developers or neighborhood associations build all new county roads, because the county can’t afford to.

Without SRS, Johnson says, neighborhoods will have to pay for their own maintenance as well.

At the same time, SRS provided $195,000 toward school retirement funds and transportation in 2006. Susanne O’Connor, a financial officer for Flathead County public schools, says that money will have to be made up through increased taxes.

At the same time, Semitool, one of the Flathead Valley’s largest employers, has asked Flathead County commissioners for a tax break. Flathead County adopted a resolution 20 years ago that allows companies making new investments in the valley to receive a multiyear tax break. In the last year, Semitool invested $7.3 million in a new facility and equipment.

The actual amount of money that may be lost to a Semitool tax break has yet to be determined, though County Commissioner Joe Brenneman acknowledges that it will be far less than the consequences of SRS’ expiration, but he also notes that other major companies in the Flathead use the same tax-relief strategy, and that the numbers add up. He hopes to eventually see the enabling resolution repealed.

In the meantime, he, Johnson and other county officials are hoping the new Congress will revisit SRS. And soon.

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