U nder federal law, local governments are compensated through various programs due to the presence of federal lands within their borders. Federally owned lands cannot be taxed by state or local governments but may create demand for services from state or local entities, such as fire protection, police cooperation, or longer roads to skirt the property. Counties with national forest lands or certain Bureau of Land Management (BLM) lands have historically received a percentage of agency revenues, primarily from timber sales. In the 1990s, timber sales declined substantially from the historic levels in the late 1980s—by more than 90% in some areas—which had led to substantially reduced payments to the counties. Congress enacted the Secure Rural Schools and Community Self-Determination Act of 2000 (SRS) to provide a temporary, optional system to supplant the revenue-sharing programs for the national forests managed by the Forest Service (FS) in the Department of Agriculture and for certain public lands administered by the BLM in the Department of the Interior. The law authorizing these payments (SRS) originally expired at the end of FY2006 but was extended an additional nine years through several reauthorizations: The 109 th Congress considered the program, but did not enact reauthorizing legislation. The 110 th Congress extended the payments for one year through FY2007, and it then enacted legislation to reauthorize the program for four years with declining payments and to modify the formula for allocating the payments. The 112 th Congress extended the program for one more year through FY2012 and amended the program to slow the decline in payments. The 113 th Congress again approved a one-year extension, reauthorizing the program through FY2013, but did not reauthorize the program for FY2014 prior to its expiration. After FS and BLM distributed the revenue-sharing payment for FY2014, the 114 th Congress reauthorized SRS for two years (through FY2015) and required the agencies to issue the FY2014 SRS payment within 45 days of enactment. SRS expired at the end of FY2015; payments were disbursed after the fiscal year ended, so the FY2015 payment was made in FY2016. This report provides background information on FS and BLM revenue-sharing and SRS payments and describes the issues that Congress has debated and may continue to debate in the 115 th Congress. In 1908, Congress directed FS to begin paying 25% of its gross receipts to states for use on roads and schools in the counties where national forests are located. Receipts come from sales, leases, rentals, or other fees for using national forest lands or resources (e.g., timber sales, recreation fees, and communication site leases). This mandatory spending program was enacted to compensate local governments for the tax-exempt status of the national forests, but the statutory compensation rate (10% of gross receipts in 1906 and 1907; 25% of gross receipts since) was not discussed in the 1906-1908 debates. This revenue- or receipt-sharing program is called Forest Service Payments to States (also referred to as the 1908 payment, or the 25% payment). The states have no discretion in assigning the funds to the county. FS determines the amount to be allocated to each county based on the national forest acreage in each county and provides that amount to the state. The states cannot retain any of the funds; they must be passed through to local governmental entities for use at the county level (but not necessarily to county governments themselves). Each state must spend the funds on road and school programs, and state law sets forth how the payments are to be allocated between road and school projects. The state laws differ widely, generally ranging from 30% to 100% for school programs, with a few states providing substantial local discretion on the split. Congress has also enacted numerous programs to share receipts from BLM lands for various types of resource use and from various classes of land. One program—the Oregon and California (O&C) payments—accounts for more than 95% of BLM receipt-sharing. The O&C payments are made to the counties in western Oregon containing the revested Oregon and California grant lands that were returned to federal ownership for failure of the states to fulfill the terms of the grant. The O&C counties receive 50% of the receipts from these lands. These mandatory payments go directly to the counties for any local governmental purposes. Concerns about, and proposals to alter, FS revenue-sharing payments also typically include the O&C payments, because both are substantial payments derived largely from timber receipts. Timber sale revenue—and, consequently, revenue-sharing payments—peaked in the late 1980s. The FY1989 FS 25% payments totaled $362 million, while O&C payments totaled $110 million. FS and O&C receipts have declined substantially since FY1989, largely because of declines in federal timber sales (see Figure 1 ) and other factors. The decline began in the Pacific Northwest, owing to a combination of forest management policies and practices, efforts to protect northern spotted owl habitat, increased planning and procedural requirements, changing public preferences, economic and industry factors, and other developments. Provisions in the Omnibus Budget Reconciliation Act of 1993 authorized FS and BLM to make so-called owl payments to several counties in Washington, Oregon, and California. These payments were set at a declining percentage of the average revenue-sharing payments made to those counties between FY1986 and FY1990. As federal timber sales—and revenue-sharing payments—began to decline nationwide, Congress replaced the regional owl payments with the nationwide SRS program in 2000. Similar to the owl payments for the Pacific Northwest, the SRS program was an optional payment that counties could elect to receive instead of receiving the 25% receipt-sharing payment. As originally enacted, the SRS payment was calculated as an average of the three highest payments made to counties between FY1986 and FY1999. With the program extension in FY2008, the SRS payment calculation was modified to also consider county population and per capita income, and it established an annually declining payment level. Payments under SRS (see Table 1 ) were substantial and significantly greater than the receipt-sharing payments. The FS payment rose from $194 million in FY2000 (all figures in nominal dollars) to a $346 million SRS payment in FY2001. For the initial six years SRS was authorized, the average FS SRS payment was $360 million annually, more than $130 million above the average annual FS payment for the six years prior to the enactment of SRS (FY1995-FY2000). Over the life of the program, the FS SRS payments have averaged $337 million and the BLM SRS payments have averaged $78 million per year. Figure 2 shows a comparison of the FS actual payments to estimates of what the payments would have been had SRS not been enacted. To illustrate, FS receipts (for revenue-sharing purposes) in FY2012 totaled $230 million. Without SRS, the revenue-sharing payment would have been around $58 million. With SRS, the payments totaled $274 million. Similarly, BLM timber receipts from western Oregon (which includes some non-O&C lands) totaled $28 million in FY2012. Without SRS, the 50% revenue-sharing payment would have been approximately $14 million, compared to the $34 million payment under SRS. SRS expired—temporarily—on October 1, 2014. With the expiration of SRS, the FY2014 payments were again to be based on a percentage of agency receipts (the rolling seven-year average of 25% for national forest lands and of 50% for O&C lands). As nonexempt, nondefense mandatory spending, the payments were subject to the annual sequestration of budgetary authority. The post-sequester revenue-sharing payment for FS was $50 million and $18 million for BLM. These payments were distributed in February 2015. P.L. 114-10 was enacted on April 16, 2015. It included provisions for a "make-up" FY2014 SRS payment, and it authorized an FY2015 SRS payment. The FY2014 payment was set at 95% of the FY2013 payment level, but for counties that opted to receive an SRS payment, the FY2014 payment was offset by the revenue-sharing payment already distributed. In effect, the counties received their FY2014 SRS payment in two installments. The total FS SRS payment for FY2014 was $274 million; for BLM it was $38 million. Because the payments were authorized after the sequestration amount was calculated for both FY2015 and FY2016, the payments were not subject to sequestration either year. SRS expired on October 1, 2016, without congressional reauthorization. Thus, counties received revenue-sharing payments for FY2016 (issued in early 2017). The post-sequester revenue-sharing payment was $54 million for the Forest Service and $19 million for BLM (see Figure 2 ). If SRS payments had been authorized, the FS payment to counties would have been approximately $248 million and the BLM payment would have been approximately $34 million. In addition to the FS and BLM receipt-sharing programs, Congress has enacted other programs to compensate for the presence of federal land. The most widely applicable program, administered by the Department of the Interior, is the Payments in Lieu of Taxes (PILT) Program. PILT payments to counties are calculated in dollars per acre of federal land and are based on eligible federal lands, as specified in statute. The eligible lands include national forests and O&C lands in each county (but total amounts are restricted in counties with very low populations). PILT payments are reduced (to a minimum payment per acre) by other payment programs—including FS Payments to States but not including BLM's O&C payments—so increases in FS payments may decrease a county's payments under PILT (and vice versa).