U.S. Senator Steve Daines addressed the Senate Energy and Natural Resources Committee regarding two legislative efforts aimed at increasing funding for Montana’s rural communities. The discussion focused on the Small County PILT Parity Act and the Restoring State Mineral Revenues Act, both of which have garnered bipartisan support.
During the hearing, Daines explained that the current Payment in Lieu of Taxes (PILT) formula disadvantages counties with populations under 5,000 by capping their payments and limiting revenue sources. He stated, “I’d like to begin with my bipartisan Small County PILT Parity Act. We have discussed the importance of the PILT program in this committee many times. It’s got strong bipartisan support. I can tell you it’s essential for Montana’s rural counties to be able to provide crucial services such as emergency response as well as public safety. However, the current PILT formula puts counties with a population less than 5,000 at a disadvantage by capping their payments and limiting the revenue streams that they have.”
Daines emphasized that his bill would expand the PILT calculation table to include population tiers down to 1,000 people or fewer without reducing payments to larger counties. He added, “These counties can and should receive fair compensation without reducing payments to counties with larger populations.”
He also thanked Ranking Member Cortez Masto for co-leading the bill and acknowledged other committee members who have cosponsored it.
State Director Jon Raby of Nevada’s Bureau of Land Management agreed with Daines’ assessment about supporting low-population counties:
“Absolutely,” Raby responded when asked if expanding the PILT table would help support such areas.
Daines then clarified that his proposal does not alter calculations for counties above 5,000 residents but rather increases overall funding: “A follow-up question, can you confirm for the committee that the bill does not change the calculations for counties with populations above 5,000, but we are simply expanding the pie, not taking away from larger counties.” Raby replied: “Yes, I can confirm that.”
The second measure discussed was Daines’ Restoring State Mineral Revenues Act. Under current law, oil and gas revenues generated on federal land are meant to be split evenly between federal authorities and states or localities where development occurs; however, a federal administrative fee reduces state shares by two percent.
Daines described this fee as an unnecessary burden: “Under the Mineral Leasing Act, revenues generated by oil and gas development on federal land are supposed to be split 50/50 between the federal government and the states and counties where the oil and gas is actually developed. But in classic D.C. bureaucracy form, the federal government charges states a 2 percent admin fee on their half of the revenues. This is just a backhanded way to take more money from the states and counties affected most.”
He continued: “This bill that I have is simple – It eliminates the two percent fee and returns the revenue sharing to a true 50/50 split. It has strong support from county governments and has passed this committee multiple times in various revenue sharing bills. Now it’s time to get it to President’s desk and make our counties whole.”
Raby expressed agreement with this approach: “I agree 100 percent that should happen.”
Both pieces of legislation remain under consideration in Congress.