"Relating to urging the United States Congress to compensate the State of Alaska for the effect of federal land ownership on the state's ability to fund public education."

This legislation stems from a resolution adopted in July of 2002 by the Executive Committee of the Council of State Governments-WEST urging its membership of thirteen states to support and pass joint resolutions expressing how federal land ownership hinders western states' ability to fund education. Since then, all thirteen states have introduced similar resolutions and all but four (CA, WA, CO, AK) have passed them.

This resolution is the result of years of research and preparation by legislators from the State of Utah in an attempt to bring western states up to equity with the rest of the nation in funding of public education.

Western states as group are falling behind in education funding when measured in growth of real per pupil expenditures during the period of 1979 - 98. Eleven of the twelve states with the lowest real growth in pupil expenditures are western states. The growth rate of real per pupil expenditures in the thirteen western states is less than half (28% versus 57%) of that in the thirty-seven other states. On average, enrollment in western states is projected to increase dramatically while the growth rate in other states is projected to actually decrease (2002-2011 western states 7.1% vs. -2.6%).

Yet, Western states' state and local taxes as a percent of personal income are as high or higher than other states (1998-99 western states 11.1% vs. 10.9%) and Western states' commitment to education as a percent of state budget is equal to that of other states (in 2000 western states 32.6% vs. 32.7%)

The problem lies with the federal government and the enormous amount of land it owns in western states. If an imaginary line was drawn from Montana to New Mexico, no state east of that line has more than 14% of its land owned by the federal government. No state west of that line has less than 27% of their land federally owned (with the exception of Hawaii). Four western states have more than 62% of their land federally owned. (Alaska, Idaho, Nevada & Utah).

Most enabling acts for western states, including Alaska, promised to give the state 5% of the proceeds from the sale of federal land for the benefit of public education. In 1977 the federal government abandoned its original policy to dispose of public lands, depriving the states of public education funding estimated to be over $14 billion dollars (Alaska $5.5 billion). This resolution does not recommend that federally owned lands be sold, only that states be compensated as promised.

States are not allowed to assess property tax on federal lands, impacting western states in an amount over $4 billion annually (Alaska $2 billion). The federal government does provide "payments in lieu of taxes" (PILT) since states cannot tax federal lands, but the amount of PILT payments to states in 2001 was only about 4% of the annual property tax revenue lost by western states.

This resolution proposes to: (1) create legislative awareness, (2) educate the public, (3) build a western states coalition, and, (4) petition Congress to compensate western states.

In summary, western states are financially harmed in a significant way by the amount of federal land ownership. The conclusion is that federal land ownership hinders western states' ability to fund public education.

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