Baucus Bill Would Fund Rural Schools Program Without Selling Public Lands
3/30/2006 3:27:00 PM
To: National Desk
Contact: Barrett Kaiser of Sen. Baucus' Office, 406-657-6790; or Andrew Blotky of Sen. Wyden's Office, 202-224-3789
WASHINGTON, March 30 /U.S. Newswire/ -- U.S. Sen. Max Baucus (D-Mont.) is introducing legislation today that will fund the Secure Rural Schools and Community Self Determination Act without selling public lands. Sen. Ron Wyden (D-Ore.) is cosponsoring the measure.
The bill will raise $2.6 billion over the next ten years for the rural schools program, commonly known as the county payments law, by closing a tax loophole that allows some government contractors to avoid their tax obligations. In 2005, Wyden, along with Sen. Larry Craig (R-Idaho) and Baucus, introduced a bill to reauthorize the county payments law for another seven years. The original law is due to expire at the end of this year.
The Bush Administration is pursuing a controversial proposal to sell as many as 300,000 acres of Forest Service lands to raise about $800 million for the program. Interior Dept. Undersecretary Mark Rey told reporters Wednesday the Administration is moving forward with the land sales plan because "our proposal is the only funding source on the table" and that Congress has to "assume the burden of coming up with an alternative."
"Our bill will fully fund the rural schools program without selling even one acre of our prized public lands," said Baucus, the highest-ranking Democrat on the Senate Finance Committee, which has jurisdiction over tax policy. "Our public lands shouldn't be put up for sale to the highest bidder. The Administration challenged congress to find a way to fund this program -- Ron and I just did."
"Rural communities throughout the country rely on these payments for top quality schools and infrastructure year in and year out," said Wyden. "We cannot abandon them, and this legislation finds a fiscally responsible way of extending this successful law."
The legislation would provide a steady revenue stream for the county payments law by closing a tax loophole in Federal contracts. Under current law, the Federal government does not withhold taxes owed from government contractors that provide goods and services to the Federal government. As a result, some contractors don’t comply with Federal tax law.
The Baucus proposal will help close the annual "tax gap" by withholding taxes from payments by the Federal government for goods and services delivered by public contractors at a rate of three percent of the payment amount.
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