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Federal Revenue Programs

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Under federal law, state and local governments receive payments through various programs due to the presence of federally owned lands within their jurisdictions. Some of these payment programs are based on the revenue generated from specific land uses and activities. The Division of Local Government (DLG) can offer technical assistance related to the distribution of funds and the election of funding options, where applicable.

Federal Mineral Lease

Exploration and production of coal, oil, natural gas, and other minerals on federal lands was authorized under the Mineral Leasing Act of 1920. The Bureau of Land Management generates revenue by selling leases and collecting royalties from oil and gas production. Through that act each state receives a portion of the revenue generated from the leasing activity. The State of Colorado distributes a portion of those revenues to local governments. More information is available about this program on the Direct Distribution - Severance Tax and Federal Mineral Lease webpage.

Secure Rural Schools

The Secure Rural Schools and Community Self-Determination Act of 2000 (SRS Act) provides payment derived in part through timber receipts and other leasing activities within National Forests back to county governments where those forests are located. The SRS payments are authorized by Congress and their amount and availability may vary from year to year. Counties with national forest lands may have the option to elect whether they receive payments through SRS or through a legacy program called the 1908 Act as amended. Follow these links to learn more about the program:

Payment in Lieu of Taxes (PILT)

"Payments in Lieu of Taxes" (or PILT) are Federal payments to local governments that help offset losses in property taxes due to nontaxable federal lands within their boundaries. PILT payments are one of the ways the federal government can fulfill its role of being a good neighbor to local communities.

The formula used to compute the payments is contained in the PILT Act and is based on population, revenue-sharing payments, and the amount of federal land within an affected county. Payments that may impact the PILT formula include revenues from the Mineral Lease Act, Secure Rural Schools Act, Bankhead-Jones Act, and Taylor Grazing Act. The Department of Interior's PILT Website has in-depth resources about the program.

If assistance is needed, the Division of Local Government can provide a PILT calculator to help provide an estimate, which can be used in the budgeting process. It is important to understand the underlying assumptions and to include additional information where available to develop the best projections possible.

Contact Information

Mia Gonzales
Budget Program Administrator
(303) 864-7744
mia.gonzales@state.co.us

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