**Testimony of**

**Mark Rey, Under Secretary**

**Natural Resources and Environment**

**United States Department of Agriculture**

**Before the**

**Subcommittee on Public Lands and Forests**

**Committee on Energy and Natural Resources**

**United States Senate**

**March 1, 2007**

**Concerning**

**S. 380 - A Bill to Reauthorize P.L. 106-393, the Secure Rural Schools
and Community Self-Determination Act of 2000**

Mr. Chairman and members of the Subcommittee:

Thank you for the opportunity to provide the Department's views on S.
380, a bill to Reauthorize the Secure Rural Schools and Community
Self-Determination Act (SRS Act).

S. 380 would reauthorize payments under the SRS Act (P.L. 106-393) for
an additional seven years, beginning with the payment for fiscal year
2007, and would amend other provisions of the Act. The bill would
provide a one-time opportunity for a county to resume receiving the 25
percent payment or 50 percent payment if they wish to do so. The bill
would clarify that States must notify the Secretary of Treasury of a
county's election.

Additionally, S. 380 would add a provision regarding the source of
funding for payments and require that certain funds be reserved to make
payments to the states. The bill would provide for reappointments of
Resource Advisory Committee (RACs) members for more than one term to
provide greater flexibility in staffing committees. S. 380 also would
revise the merchantable material pilot program to authorize projects
under this program if they are recommended by a RAC. Finally the bill
would add notification and reporting requirements for the Secretary
regarding county projects under Title III.

The Administration continues to support a one-year extension of the SRS
Act for FY 2007 as an interim step, so long as there are agreed-upon
full offsets. The Administration could support S. 380 with agreed upon
offsets for the payments authorized by the bill, an eventual phase out
of payments and if the bill is amended to incorporate other changes.

To assist in offsetting the cost of reauthorizing the SRS, the
Administration is proposing the National Forest Land Conveyance for
Rural Communities Act. This proposal supports the President's FY 2008
Budget by authorizing the Secretary to sell certain identified National
Forest System lands in an amount not to exceed \$800 million. Under the
proposal, half of the land sales proceeds will be available to make
payments under a reauthorized SRS Act for FY 2008-2011, and half will be
available in the States in which they were collected for the acquisition
of lands or interests in land for National Forest purposes, improvement
of fish and wildlife habitat, restoration of National Forest System
land, and conservation education. States would benefit from four
additional years of payments (FY's 2008-2011), and would also benefit
from the addition of more ecologically important land to the National
Forest System.

Our proposal provides up to \$400 million dollars over a four year
period to be made available for acquiring lands and interests in land
for National Forest purposes from receipts obtained from selling
National Forest System lands that are identified for conveyance.
Implementing our proposal will result in acquiring lands that are better
suited for National Forest purposes and additionally, could result in a
net increase in acres of land under federal ownership. For instance, the
ratio of lands acquired versus conveyed under our ongoing land exchange
program for the past ten years has been a two and a half to one ratio.
The net increase is because the lands conveyed are more economically
valuable then the lands acquired which are more ecologically valuable.
Additionally purchase and sale of tracts is an inherently more efficient
means of adjusting ownership than exchange, because it does not require
a one-to-one correlation in federal government and private landowner
objectives over two specific tracts. Our proposed legislation will be
transmitted to Congress in the very near future for your consideration.

The Administration would like to work with the subcommittee on
additional amendments to S. 380 that will improve the legislation. For
example, we recommend that sections 2 (c)(1)(C) and 2(c)(2)(C) of the
bill be deleted as the Department believes these sections are not
needed. We are also concerned about the inclusion of the notification
and reporting requirements regarding county projects under Title III in
section 2(f) of the bill. This provision requires the Secretary to
monitor and report on the use of these funds by local units of
government which would require detailed reporting that many local
governments might find onerous. We would like to work with the committee
on alternative methods for insuring accountability for Title III funds.
For example, it may be appropriate to require RAC review and approval of
expenditures of any funds under Title III. The Department of the
Treasury advises that the bill would improperly assign certain duties to
the Secretary of the Treasury that would be more properly assigned to
the Departments of Agriculture and the Interior. We would like to work
with the Committee on these and other technical and substantive
amendments.

The SRS Act provided transitional assistance to rural counties affected
by the decline in revenue from timber harvests on federal lands.
Traditionally, these counties relied on a share of receipts from
National Forest System lands to supplement local funding for schools and
roads. Payments made under the SRS Act have been used to support more
than 4,400 rural schools and to help maintain county road systems.

In addition, the SRS Act provided for the establishment of RACs. RACs
have increased the level of interaction between the Forest Service,
local governments, and citizens, resulting in greater support and
understanding of the agency's mission. A total of 55 RACs in 13 States
have proposed more than 4,500 resource projects on National Forests and
adjacent non-federal lands under Title II. Funds allocated under the SRS
Act for Title II projects (\$185 million) have been leveraged by more
than \$192 million in funds from other non-federal sources.

The last payment authorized by the SRS Act was for fiscal year 2006 and
was made in December of 2006. Additionally, the authority for RACs to
meet and propose projects expired on September 30, 2006. These
committees have improved relationships by: broadening their connections,
increasing access to resources and information, building trust, and
providing active discourse on public policy issues. We need the support
and assistance of these RACs in completing Title II projects that are in
progress.

I am pleased to announce today that we will be extending the role of
these committees for an additional year by amending the existing
charters to allow them to be authorized as discretionary committees
under the Federal Advisory Committee Act. This will enable them to
continue to meet in order to monitor and track the implementation of
approved projects as well as to make recommendations regarding changes
or adjustments that may be necessary to the projects they are
monitoring.

This concludes my statement, I would be happy to answer any questions
that you may have.