CORVALLIS - A newly completed study of how Oregon counties are dealing with the loss of federal forest payments suggests that without this funding many counties will be making major cuts in road and bridge maintenance, emergency services, and sheriff departments.

The study, conducted by the Rural Studies Program at Oregon State University, also found that these reductions come on top of adjustments that many counties already have made during the past three years - partly in anticipation of the termination of payments.

Because Congress did not extend the Secure Rural Schools and Community Self-Determination Act that provided these forest payments, 33 of Oregon's 36 counties are entering the fiscal year without this funding that has traditionally supplied significant revenues for roads and general government services.

About three-fourths of the responding counties indicated they planned to reduce service levels in their operating budgets without Secure Rural Schools funding and half indicated that they would reduce their capital construction budgets. The most severe reductions, the OSU researchers say, will be in roads and bridge maintenance, emergency services, sheriff departments and administration/finance. More than one in five counties will cut those services by at least 10 percent during the fiscal year that began July 1.

"These impacts are most pronounced in the eastern and southwestern parts of the state, where federal forest payments have comprised a greater percentage of the counties' budgets," said Brent Steel, a professor of political science at OSU and a co-author on the study.

Many counties had already been cutting services and jobs in recent years, or setting aside forest payments for future use, the study pointed out. During the past three years, the number of full-time county employees has been reduced by 2 percent.

About half of the counties have indicated they are considering increasing taxes or fees in the future to cover part of the shortage. However, Bruce Weber, a professor of agricultural and resource economics at OSU and director of the university's Rural Studies Program, said local governments are constrained in their capacity to increase taxes.

"Based on the experience of the past decade, for example, the chance of success for local option levies is just over one-in-three," said Weber, a co-author on the study. "Oregon's property tax system makes it difficult to pass local option levies."

The OSU Rural Studies Program report is available online at: http://ruralstudies.oregonstate.edu/Publications/SRS_Report.pdf

The study focused on four general areas of county government, including general fiscal condition, capital budgets, operating budgets and local fiscal adjustments.

Eight Eastern Oregon counties with Forest Service lands indicate they are concerned about bridge maintenance; eight counties with O&C lands report that they will have trouble maintaining parks.

Road budgets will be especially hard-hit for some counties, Weber said.

Steel said the impacts of the forest payment termination are even greater because of the timing.

"If you factor in a downturn in the economy, astronomical fuel prices, and depressed sectors in coastal fishing and logging industries, it will be difficult for the counties to adapt," Steel said. "Keep in mind that in some smaller communities, the government is the largest employer. When you start laying people off there, the domino effect can be enormous."

The origins of this funding shortfall go back decades. Federal forest payments to counties had been shared revenues related to timber harvests and when federal harvests declined in the late 1980s and 1990s so, too, did revenues. In 1993 Congress began to decouple the payments from actual harvest receipts, providing additional federal revenue under a "safety net" to counties affected by listing of the northern spotted owl under the Endangered Species Act.

Congress passed the broader Secure Rural Schools and Community Self-Determination Act in 2000 to provide payments to all counties with federal forest lands to compensate for declining timber harvests. Authorization for the act ran out in September of 2006 and Congress provided an additional year of funding to give counties time to prepare for the loss of funds. Attempts during the past year to restore the funding have failed.