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1 1 (February 25, 2021)

handle is hein.crs/govecij0001 and id is 1 raw text is: Conqressi&nol fleseorob Servce 4 A ~ming¶tfl4AtIat edd~te s~vw~ viz February 25, 2021 Payments in Lieu of Taxes (PILT): Section 6902 Payments Introduction Several federal programs exist to compensate local jurisdictions for the presence ofnontaxable federallands. The widest-ranging programis known as Payments in Lieu of Taxes (PILT). PILT compensates units of general local government (generally referred to as counties, although a unit could be other than a county) for selected lands administered by several federal agencies. PILT is administered by the Office of the Secretary in the Dep artment of the Interior (DOI). In FY2020, PILT paid $515 million to more than 1,900 counties across 49 states, the District of Columbia, Guam, Puerto Rico, and the Virgin Islands. PILT funding is allocated through three payment mechanis ms-Section 6902, Section 6904, and Section 6905-which are named for the sections of law in which they are authorized (31 U.S.C. § §6902, 6904, 6905). Section 6902 payments account for the majority of PILT payments and are available to the most counties. Section 6904 and 6905 payments account for<1% of PILT payments, are supplementary to 6902 payments, and are made to selected counties for specific purposes as identified in statute. This In Focus discusses Section 6902 payments. Payment Structure Section 6902 payments are made to counties pursuant to a formula provided in statute (Figure 1). Several factors are used to calculate the authorized PILT payment amount for a county: entitlement land andper acre payment rates, population-b ased payment ceilings, prior- year payments, pass-through laws, and inflation. These factors are described below. Additionally, the level of funding appropriated for PILT payments determines whether counties receive the fully authorized payment amount or a lesser, prorated amount. Fntitlement Land and Per Acre Payment Rates: Lands eligible under PILT are referred to as entitlement lands in statute (31 U.S.C. §6901) and include federal lands * in the NationalPark System; * in the National Forest System; * administered by the Bureau of Land Management; * in the National Wildlife Refuge Systemwithdrawn from the public domain; * dedicated to the use of federal water resources development projects; * used for certain dredge disposal areas; * located near Purgatory River Canyon and Pifion Canyon, CO, that were acquired after December 31, 1981, to expand the Fort Carsonmilitary reservation; * on which are located semi-active or inactive Army installations used for certain purposes; and * acquired per the Southern NevadaPublic Land Management Act (P.L. 105-263). The first step in calculating authorized payments is determining the number of entitlement acres within a county, which is the responsibility of the various federal agencies that administer thelands (Figure 1, Step A). Taking into account a population-basedpayment ceiling as described below (Figure 1, Step B), a county's authorized payment is calculated by multiplying the number of entitlement acres by one of two per acre payment rates-a higher rate offset byprior-yearpayments (Alternative A) or a non-offsetlower rate (Alternative B) (Figure 1, Step C). The higher amount is the authorized payment. Figure 1. PILT Section 6902 Payment Formula, with FY2020 Rates A C.11(.Jktt C alc:ult ou intV s priynt cilirn ea-h CpP- y Source: CRS, with data from 31 U.S.C. §§690I et seq. and DOI, FY2020 Payments in Lieu of Taxes National Summary, at https://www.doi.gov/pil/ resources/annual-reports. Peracre payment rates are adjusted annually for inflation (31 U.S.C. §6903(d)). tps://crsreports.cong re

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