$40,000.00 (which we estimate we will if the present ruling is enforced) it will put us in an extremely difficult financial position. To show you how unfair this is Cottonwood received $9,730.63 and Kamiah received $10,268.55 from 1966-67 Forest Funds and neither has one acre of forest land and so will have no deduction from their 874 funds. We have all the forest lands so will lose about $40,000.00 (You probably know that the Forest Funds which go to school districts are divided between the school districts within a county according to the average daily attendance in each district. I'm not in agreement with this distribution either but have not complained too much since we had the bulk of the students.) We have no quarrel with the ruling that Forest Funds should be used for capital outlay. If a deduction is to be made we can see some justification to deduct from 815 funds but not from 874 funds. Our Taxpayers pay 10 mills or over $100,000.00 each year for interest and bond redemption (this is a 20 year bond with 12 more years to pay) while they get nothing from the thousands of acres of Federal forest land. As you know we have about 4.5 million acres of U.S. forest land in our school district. It seems only a small gesture on the Federal Government's part to let us use Forest Funds for capital outlay since we get nothing from Federal lands to help redeem our bonds. It seems to us that the ruling should remain as it has been in the past. (Forest Funds would be subtracted from 874 funds only if used for maintenance and operation.) If this cannot be accomplished the very least we should expect is that the ruling not apply this year because we are already half way through the year with Forest Funds and 874 both committed. We understand this ruling came from the Committee on Federally Affected Areas from the U.S. Office of Education under B. Alden Lillywhite. As you can imagine this came as quite a shock to us so would you please see if this ruling can't be reversed? If there is anything we can do please call us. Sincerely, EARL VOPAT, District Superintendent. Mr. FRANK CHURCH, Senator, State of Idaho, JOINT SCHOOL DISTRICT No. 171, Clearwater County, Idaho, December 30, 1966. DEAR SENATOR CHURCH: This letter has been written to request your cooperation and assistance in evaluating an interpretation placed on a section of Public Law 874 entitled "Deductions of Tax Receipts from Federal Property". All school districts that receive revenue from P.L. 874 and shared revenue from Forest Service Funds will suffer a loss of income as the result of this interpretation. Income from Federal property will now be deducted against students claimed against that property. In our case, all pupils claimed against Forest Service property will be deducted from P.L. 874 funds. This ruling was made by the Federally Affected Area Committee from the U.S. Office of Education and was sent out from Mr. Allen Lillywhite's office in Washington, D.C. All school districts that receive P.L. 874 funds have already placed in their 1966-67 budgets anticipated money from this service and as it will be subtracted from already received Forest Service Funds, our district will lose approximately $22,000 of revenue planned on for the present 1966-67 budget. It seems inconsistent that shared revenue returned to school districts as the result of cutting of trees located on Federal property, and by law designated as a Capital Outlay Fund would be deducted from P.L. 874 funds which by the same token is a current expenditure fund. Joint School District #171 has approximately 300 more students than a year ago, mainly as the result of Dworshak Dam. As these pupils are in our district as the result of this construction, it appears very inconsistent to deduct from the actual funds P.L. 874 appropriated for this impact. I am hesitant to believe this was the intent of congress to place this interpretation on the law. Thanking you in advance for your inerest and help, I remain, Yours very truly, GILROY'S GENERAL MERCHANDISE, Hon. FRANK CHURCH, Washington, D.C. DEAR SENATOR CHURCH: It has come to our attention that a ruling has been made by the Committee on Federally Affected areas from the U.S. Office of Education under B. Alden Lillywhite, that the U.S. Forest Funds received by School Districts would be subtracted from the 874 funds, if the 874 funds were received as a result of logging activities. This will be a very hard jolt to our Idaho County School District 241 causing them a loss of about $40,000.00 in Federal Funds this year. The sad part of this is the funds have already been budgeted and a new addition has been started at Riggins at a cost of about $225,000.00 and this project is about 80% complete. Last year a new addition was made at the Kooskia Grade School, and the year previous a new Grade School, was constructed at Whitebird. These additions have been constructed from the Forest funds. The District is already carrying a heavy Bond load that has another twelve years to run. As you well know Idaho County has about 4.5 million Acres of U.S. Forest land from which the only revenue the School District gets is through the U.S. Forest Funds and the 874 Funds. If there is any way that you could help to get this ruling reversed or at least recoonsidered for at least the present year it would be greatly appreciated and be of a big help to our schools. Yours very truly, W. RAY GILROY. CASCADE PUBLIC SCHOOL DISTRICT NO. 422, Hon. FRANK CHURCH, I recently attended a meeting conducted by the Regional Representative (Denver) for Public Law 874. This meeting was held in Boise for administrators from the schools in this part of our State that participate in the Public Law 874 Program. I came away both dejected and bewildered. We were told that the new Bulletin of regulations requires that monies received from the Federal Forest Fund must be subtracted from the amount of our P.L. 874 entitlement. This is a drastic change and for all practical purposes eliminates this school district from the P.L. 874 program. The most serious problem involved with this is that this money was budgeted as anticipated revenue and in reality has been pretty well expended by this time in the budget year. I just cannot imagine that the intent of Congress was to cripple the operation of this school district as will surely have to happen. It has been mentioned that Public Law 89-10, Title I funds might be used to help at this time. Our school district is one of the few that cannot qualify for any funds under this act. So as you can see we are in a financial dilemma. I do not know where this critical decision was made or what can be done to change it. I only know that you have worked long and hard to save the P.L. 874 program and I thought you should know of this latest development. I would request that you look into the matter and see if there could be some change made. This affects relatively few schools in Idaho but those affected have received a severe blow. Thank you for your time and effort in this matter. JERRY L. EVANS, Superintendent. Hon. FRANK CHURCH, BONNER COUNTY CLASS A SCHOOL DISTRICT NO. 82, U. S. Senator, Senate Office Building, Dear Senator CHURCH: I received notice of the bill you introduced in the Senate with regards to providing relief to our schools. I am a member of the School Board of Bonner County School District No. 82. Our district is a consolidated district encompassing all of Bonner County. It is one of the largest districts in the United States; about 60 per cent of our real estate is in forest service land. We had one of the finest stands of timber in the country some 50 years ago, however, it will soon be a memory of the past. And as far as being of any value to the school or county in proportion to what the timber is being sold for by the Government, it isn't a drop in the bucket. I purchased or did purchase U.S. forest timber sales until the stumpage price climbed too high. As a small operator I paid around $84,000 for stumpage in a short period of time; this is approximately as much as we received in a three year period for support of our schools. The money we receive from Public Law 874 entitlement does not begin to pay the cost of educating our federally-connected children. We have spent some $600.00 per student in the past 15 years to house our students, besides our annual budget for Maintenance and Operation of $1,720,000.00 for 3700 students. These forest service lands divide our population so much that we have to operate 42 school buses to get our children to the 18 school buildings in the district. Local tax payers even have to pay taxes for the construction and maintenance of long stretches of county roads so the forest service personnel can get to the forest. It was quite a shock to us on the school board when we found out that the government wanted to get out from under what little aid they were giving us. Maybe it is more important to spend the money on a moon shot than for the government to help pay for the education of children in a county where a large portion of the property is owned by the United States Government. Most of our public utilities, who pay about % of our local property taxes, have paid their 1966 taxes under protest. The Supreme Court of Idaho has just handed down a decision in favor of the utilities in Idaho; hence we won't have enough funds this year to pay some 175 teachers we have, besides the other 100 employees of the district. I wish those who want to take what Forest Lands Funds and Impact assistance we receive were faced with the problem of raising taxes to meet these bills, when such a small amount of income is realized from these thousands of acres of tax exempt land the government owns in our county. We appreciate your help, Senator, keep up the good work. As ever your supporter and friend, Hon. FRANK CHURCH, Senate Office Building, Washington, D.C. V. A. VERHEI SCHOOL DISTRICT NO. 271, Coeur D'Alene, Idaho, January 27, 1967. Dear SENATOR CHURCH: Received your Washington release concerning the problem of school districts having Federal Forest money substracted from the 874 money. Our district would come up short by about $9,000. This money was budgeted in good faith on the basis of all information supplied by the Federal and State agencies. I am sure that states without Federal lands do not realize the problem of securing revenue from non-tax producting lands. Each year our Federal Forest payments have been getting less and less when the production has increased and more revenue is being received for the sale of timber. Any help you can give to correct this situation will be greatly appreciated. S. CLAY COY, Superintendent of Schools. Hon. FRANK CHURCH, U.S. Senate, Washington, D.C. GARDEN VALLEY SCHOOLS, At a recent conference on federal impact funds held by Harold Farley of the Idaho State Dept. of Education, we were informed that our School District's Federal Forest Funds would be subtracted from our P.L. 874 Title I impact funds for the school year 1966–67. I wonder if our U.S. Legislators were aware that School District budgets are prepared and approved prior to July 1 preceding the next school year and all of the Idaho Schools have budgeted the anticipated revenue from both the Federal Forest funds and the P.L. 874 impact entitlement to support their school plan for this term. If this revenue is subtracted it will mean either cutbacks in our school program or deficit spending. Our school will loose $6,288.49 if the ruling given us is applied. This will mean a loss of funds equal to approximately one and one-eighth of our teachers salaries or 7.42% of our total budgeted expenditures. Since we have a faculty of only eight and one-half full time teachers it would mean a cut back of 14% of the teaching staff. The Federal Forest Funds are merely a re-embursement for lands withdrawn from the county assessments and the P.L. 874 funds are re-embursement for impacted students whose attendance in our schools are the result of Federal employment within this area of parents who pay no direct property taxes in support of our school. We started a building program in 1964, budgeting our Forest Income to make the payments on the Bond Issue we floated to build new High School facilities. If the Forest Funds are subtracted from the P.L. 874 funds, it will mean either a cutback in quality and quantity of education offered by our school or the taxpayers will be burdened with an extra six and one-half mill levy. I hope this information will help you convince the persons responsible for the change in policy to reconsider their actions since it has been the policy of our leaders on both parties to aid educational systems with financial help wherever possible. Sincerely yours, IRA RODEMARK, Superintendent. FOREST FUNDS IDAHO SESSION LAWS OF 1957 CHAPTER 116 (S.B. NO. 101) (PAGE 194) Section 2. County Apportionment of Forest Reserve Funds.-The treasurer of each county receiving a portion of this fund shall immediately allot seventy per cent (70%) of this money to the county general road fund and to the treasurer of the highway districts and good road districts in the county in proportion to the mileage of each within the county, to be expended for the construction and repair of roads and bridges, and thirty per cent (30%) to the various school districts and joint county school districts within the county in proportion to the number of pupils in average daily attendance in each district in the year immediately prior to this distribution. The distribution of such moneys to the respective school districts entitled thereto shall be in addition to and without regard to any assistance to such school districts from any and all other sources in maintaining the minimum educational program and minimum transportation program. Forest Funds Idaho Section 4. Use of such moneys.-The school portion of this money may be retained, accumulated aid expended for the purchase of school sites and for the construction and remodeling of school buildings, within the disposition of the trustees of the respective school districts; provided, that when, within the description of the trustees of the respective school districts; such moneys are not so needed they may be expended for current expenses. NOTE.-Prior legislation apportioned money to the county school fund and "the same shall be apportioned as other moneys in the county school funds are apportioned." 33-1101-Idaho Code STATEMENT OF HON. LEN B. JORDAN, A U.S. SENATOR FROM THE STATE OF IDAHO Senator JORDAN. Mr. Chairman, I appreciate the opportunity to present my views on a matter of urgency and equity to a number of school districts which are faced with an unanticipated and critical revenue loss. A change in Public Law 874 signed into law late last fall has imposed serious financial hardships on school districts in which a large percentage of the land is federally owned. The bill presently before the subcommittee, S. 382, which I have joined my colleague Senator Frank Church in sponsoring, is intended to provide immediate help for this situation as well as long-range relief. The difficulties stem from an amendment contained in Public Law 89-750. This amendment was explained to Mr. B. Alden Lillywhite, Director of School Assistance for Federally Affected Areas, the U.S. Office of Education, in his bulletin of November 15, 1966 as follows: This amendment makes the following three changes in the provisions relating to deducting taxes and federal payments from gross entitlement. (A) Taxes or payments-in-lieu-of-taxes, and any other payment made with respect to federal property pursuant to any law of the United States other than Title I of P.L. 874 and paid on account of "federal property," will be deducted from gross entitlement computed for a school district only to the extent of the entitlement computed for children connected with the federal property on account of which the taxes or payments were made. This is the same basis as earnings on forest lands, Taylor Grazing funds, and other similar federal payments now are deducted. (B) No deduction will be made when the total amount of the deductible items for an applicant in a year is less than $1,000. (C) Districts no longer may avoid a deduction by not making "other federal payments" available for current expenses. The entire amount of "other federal payments" as defined in subsection (b)(1) of section 2, "tax payments, payments-in-lieu-of-taxes and other federal payments" received by a school district in any year for any purpose will be deducted from gross entitlement. S. 382 is intended to focus on the last mentioned change outlined in Mr. Lilly white's explanation. Schools in the State of Idaho are adversely affected by this change. In Idaho, aside from Public Law 874 entitlements, moneys from forestry reserve funds, representing a portion of revenues from the sale of timber in the national forests, constitute the largest source of income to school districts from Federal payments on account of Federal property. Idaho law requires that districts must spend these funds for capital outlay expenses. They are not available for maintenance and operation expenditures. Thus, what the change does, in effect, is subtract moneys which are now required by law to be used for capital outlay from entitlements for funds which are required by law to be used for maintenance and operation. The result is a substantial reduction in operating funds available to school districts. Formerly deduction of "other Federal payments" from Public Law 874 entitlements was required only to the extent that such payments were actually available for current expenditures. This old system allowed the school districts to keep the full amount of Federal payments with respect to Federal property which were used for differing purposes. Last year's change was apparently made on the basis of a determination that this system permitted an unwarranted double payment. I would agree that this conclusion is technically accurate. However, its application only aggravates a condition which finds school districts in public land States in serious financial straits because of the overall inadequacy of Federal payments made to offset the impact of Federal ownership. |