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FINANCIAL CRISIS: RIPPLE EFFECT

Rural communities get funding for schools, roads

The rescue package includes a $2-billion extension of a program that aids communities with small tax bases.

October 04, 2008|Bettina Boxall | Times Staff Writer

Friday's federal bailout package will include several billion dollars in education and road funding for some of the nation's most remote communities, through programs aimed at helping areas with large swaths of untaxed federal land.

The funding was among the sweeteners attached to the financial industry rescue bill passed by the House of Representatives on Friday and signed by President Bush.

Education and county government groups and their lobbyists worked through Thursday night pushing for a four-year, $2-billion extension of the rural program, which this year funneled $69 million to California counties.

"It's been an E-ticket roller coaster ride to get to this point," said Bob Douglas, executive director of the National Forest Counties and Schools Coalition.

The payments, first authorized in 2000, offset a steep decline in federal logging revenue, a portion of which goes to forested counties to make up for their small property tax base.

Nationally, rural counties, most of them in the West, have collected about $500 million a year under the program. Oregon, California and Washington have been the biggest beneficiaries.

The initial round of funding expired two years ago, and since then attempts to extend the program have been buffeted by politics. At one point the Bush administration proposed selling national forest parcels to raise money for the payments.

Last year a one-year extension was included in an Iraq war funding bill. This year advocates attached funding proposals to various bills, only to see the money dropped at the last minute.

The financial uncertainty prompted widespread cutbacks in school staffing and programs. Douglas estimated that nationally, as many as 16,000 people had been laid off from county government, road projects and school positions.

Siskiyou County in far northern California has gotten $9.5 million a year, the most of any county in the state.

About $400,000 goes to the Yreka Union School District, which chopped about 5% from its budget this year out of concern that the money was drying up.

The district cut teacher's aide positions, consolidated bus routes, increased class sizes and dropped field trips.

"It's good news," district Supt. Vanston Shaw said of Friday's action. "We had not planned on it."

In addition to the money for schools and roads, the bailout package included four more years of funding for another, long-standing program that aids local governments in areas with large amounts of federal land. Last year California collected more than $20 million under that program.

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bettina.boxall@latimes.com

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