Secure Rural Schools (SRS) Act and USFS Timber Harvest Payments Election Process and County Road Revenue Forecasts
Federal Fiscal Year 2022 (County Fiscal Year 2023) Secure Rural Schools (SRS) Program payments are projected to be greater than United States Forest Services (USFS) 1908 Act 25-percent timber harvest payments for all Oregon Counties except for Malheur and Umatilla County. Counties have until September 30th, 2022 to submit allocation elections between SRS Title I, II, and III to the Oregon State Treasurer / Department of Administrative Services (DAS). AOC will distribute more information on submitting allocation elections when made available by DAS.
Elections Deadlines Between SRS and USFS
Counties can elect to receive USFS timber payments instead of SRS payments. SRS payments have been reauthorized by Congress through the Infrastructure Investment and Jobs Act (IIJA) and set at 2017 funding levels for the next two fiscal years. USFS timber harvest receipt payments are calculated as 25% of the gross grazing fees and timber sales receipts over the past 7 years’ rolling average. SRS Payments are consistently projected to be higher than USFS timber harvest receipt payments.
Counties can elect to receive USFS timber harvest receipts or SRS payments every two years. The next deadline for electing to receive SRS / USFS timber harvest receipts is August 1, 2023 and every odd year thereafter.
Elections Deadlines Between SRS Titles I, II, and III
SRS funding is divided into three titles which are earmarked for specific purposes.
- Title I – Roads and schools
- Title II – Special projects on federal lands
- Title III – County wildfire protection projects, broadband access and emergency services
Oregon Counties have the choice to elect allocation amounts between SRS Title I, II, and III. The amount of funding a county receives from SRS changes the percentage of SRS funds that can be allocated between different titles. Funding Distributions are split in three categories:
- Minor Distributions – Less than $100,000
- Modest Distributions – Between $100,000 and $350,000
- Major Distributions – More than $350,000
Allocations between Titles I, II, and III have maximum and minimum allowable percentages. Those percentages are different for minor, modest, and major distributions. Allocation must fall within the ranges displayed in Table 1
Table 1 Allocation Ranges for Each Title and Distribution
|Title I||80% – 100%||80% – 85%||80% – 85%|
|Title II||0% – 20%||15% – 20%||13% – 20%|
|Title III||0% – 20%||15% – 20%||0% – 7%|
Counties can elect SRS allocations every year by submitting paperwork to the State Treasurer. The next deadline for SRS Allocation Elections is September 30, 2022 and every year when authorized by congress. Please note the majority of Oregon Counties elect to allocate 85% of their SRS distribution to Title I, a decrease in this percentage would reduce annual road funding. For FY 21 allocations see ASR-18-01 (page 50).
USFS Timber Receipts Estimates: CFY 2023 $7 million
USFS estimates are based on 25% timber harvest receipts (1908 Act 25-percent payments) from Federal Fiscal Year 2016 (County Fiscal Year 2017), which is the most recent county by county data released by the Forest Service. These figures were used to calculate a weighted average of each county’s historic share of timber harvest receipts. Current estimates were created by combining historic shares with statewide receipts from data post 2016. This method is inherently inaccurate, as actual allocations are based on the actual receipts in each national forest and in each county, not a statewide average. This is, however, a fairly accurate proxy based on historical trends.Timber harvest receipts have been consistent since 2016 as demonstrated in Figure 1. A slight decrease in timber harvest sales was observed in FY 2021.
Please note that O&C County payments follow a different process, with different funding sources, requirements, and estimates.
Figure 1: Oregon Timber Sales 1970 – 2018
Please note that counties only receive USFS receipts if a county selects not to receive SRS payments. In most cases, this would represent the minimum budget option.
Secure Rural Schools Estimates: CFY 2023 $33 million.
Congress has taken action to reauthorize the program through the Infrastructure Investment and Jobs Act (IIJA). SRS Payments are authorized for the next two fiscal years and will not be subject to the typical 5% annual decrease. Instead, SRS payments will be increased to the amount from Federal FY 2017 for FY 2022, and FY 2023.
SRS Payments are divided between Title I, II, and III, with Title I providing funding for roads. Counties can elect allocations of SRS funding between Title I, II, and III. The reauthorization in 2021 did not provide counties the opportunity to elect allocations, SRS has a default allocation between Titles I and II if elections are not made. Congress locked in 2013 elections for titles I, II and III (same as all reauthorizations since 2013) for FY 21, and allowed for new elections for FY 22 and 23 payments.
Comparing SRS and USFS Timber Harvest Receipts
Since the USFS has not published county by county payment estimates for timber harvest receipts since 2016, AOC has produced some exploratory estimates. By using state wide gross timber harvest receipts for FY 2021 and historic shares of USFS funds, a very rough estimate was produced. Table 2 displays the gross USFS receipts, The portion of USFS receipts payable to road departments, SRS payments to road departments, and the difference between USFS timber harvest receipts and SRS Payments. Negative numbers indicate that SRS payments are larger than USFS timber receipt payments. Figures highlighted in Green draw special attention to instances where USFS timber receipt payments are larger than SRS payments.
Table 2: USFS Timber Harvest Receipts and SRS Payments Comparison
|County FY 23|
|County||USFS FFY 22 Estimate||SRS FFY 22 Title I||Difference USFS – SRS|
Forecasting Uncertainty and FY 2022-23 Outlook
This FY 2022-23 forecast represents a conservative baseline county funding model estimate approach for dedicated funding budget planning purposes.
Please reach out to Jordan Cole (email@example.com) for more information with any questions or concerns.
Information and References