Budget cuts mean less federal cash for Mesa County
Forced sequester cuts will decrease the amount of money Mesa County is set to receive in connection with the area’s high percentage of federal lands, finance officials told county commissioners this week.
Each year, the county receives a sizable sum from the federal government via the Payments in Lieu of Taxes program, which is intended to offset losses in property taxes that counties would otherwise receive for their nontaxable federal lands.
Mesa County counts more than 1.5 million acres of federal land among its more than 2.1 million total acres.
County Finance Director Marcia Arnhold told commissioners she expects a 5.1 percent reduction in PILT funds, part of the $3.2 million in PILT funds and Federal Mineral Lease revenues budgeted for this year. That anticipated reduction equates to an estimated $163,200 that won’t find its way into the county’s general fund this year.
The county received $3.4 million in PILT and FML money last year, and Commissioner Steve Acquafresca said he expected the trend of shrinking PILT payments to continue. The PILT program is offered under the umbrella of the federal Department of Interior.
“We lost a PILT ally when (former Interior) Secretary (Ken) Salazar left his office,” Acquafresca said. “He understood PILT, and he understood the importance of it to counties. He actually increased the PILT payments in the years that he was secretary.”
Salazar left his Cabinet post this month and will be replaced by Sally Jewell, the former chief executive of outdoor retailer Recreational Equipment Inc.
“He’s going away, so I expect PILT payments to evaporate,” Acquafresca said.
In describing the program, Interior says “PILT payments are one of the ways that the federal government can fulfill its role of being a good neighbor to local communities.”
“PILT payments help local governments carry out such vital services as firefighting and police protection, construction of public schools and roads, and search-and-rescue operations,” the website for the federal agency reads.
Arnhold told commissioners of another likely sequester impact to county finances — a reduction in the 35-percent credit on interest the county pays each year on certificates of participation issued in 2010.
The Build America bond program, established as part of the 2009 federal stimulus program, provides the interest credit, but Arnhold said the 35-percent credit is set to be reduced by 8.7 percent this year. In dollars to the county, that reduction will be worth about $28,000 in 2013.
“It’s just frightening that the federal government can renege on these contractual agreements with such ease,” Acquafresca said. “This is probably just one issue, of scores, that we’re likely to see.”
Aside from finance, the county also expects the sequester cuts to have an impact on the Health Department as well as the Department of Human Services, as both rely on federal funding for a number of programs.