07/09/2008

By JEFF BARNARD  / Associated Press

Timber counties in Oregon are cutting services and considering tax increases to deal with the loss of a federal timber payments safety net, according to a survey by Oregon State University's Rural Studies Program released Wednesday.

The survey found the biggest cuts are to road and bridge maintenance, emergency services and sheriff's departments.

Eastern Oregon felt it most in road budgets. Western Oregon cut deepest in administration, finance, parks, emergency services and sheriff's departments. The six rural counties in southwestern Oregon lost an average of one-third of their general funds.

Most people will not immediately feel the impacts for several years, particularly the deterioration of roads, said Bruce Weber, an OSU economist who worked on the survey.

"I think it will take something dramatic for people to realize what not having a sheriff's department or emergency services will mean," he said.

Commissioner C.W. Smith said by making cuts early and privatizing many services, Jackson County was able to survive the loss of $23 million. But Smith added that commissioners still don't know how they are going to get money to fully maintain roads.

Overall 23 counties face road budget shortfalls, 16 can't maintain buildings, eight in Eastern Oregon can't maintain bridges, and eight in Western Oregon can't maintain parks.

Thirty-three of Oregon's 36 counties receive payments tied to timber harvests on national forests from the federal government.

When logging on federal land was cut more than 80 percent in 1994 to protect habitat for the spotted owl and salmon, Congress voted in a safety net. Payments worth about $200 million a year in Oregon were ramped down and expired last month.

While the economies of many rural areas of Oregon no longer depend on timber, many county governments still do. With high levels of federal timber payments, they never created a permanent tax base they could depend on. Now that they must raise taxes to maintain services, they are hamstrung by constitutional constraints that make it difficult.

The survey found about half of the counties are considering raising taxes or fees to cover the shortfall, but Weber said their chances of succeeding are only about one in three.

A special governor's taskforce has said Oregon's best hope is for Congress to restore the safety net for four more years to give the state and counties time to work out alternative sources of revenue, such as a controversial plan to boost logging in Western Oregon.

So far efforts by Oregon's congressional delegation have failed.

Meanwhile, the taskforce suggested counties look at raising taxes.

The survey found that in 2005-06, one-fourth of the counties had cut services and jobs, and one-third had increased fees. Half said they could still maintain their roads.

By 2007-2008, two-thirds of counties had cut services and jobs, and only one-fourth could still pay for roads.

Ten counties spent all of their final safety net payment, while 13 counties set aside an average of 54 percent for the future. Four counties put three-quarters of the payments into reserves.

Over the past three years, timber counties have cut full-time jobs by 2 percent.

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On the net: http://ruralstudies.oregonstate.edu/Publications/SRS_Report.pdf