Katana VentraIP

Oregon and California Railroad Revested Lands

The Oregon and California Railroad Revested Lands (commonly known as O&C Lands), are approximately 2,600,000 acres (1,100,000 ha) of land located in eighteen counties of western Oregon. Originally granted to the Oregon & California Railroad to build a railroad between Portland, Oregon and San Francisco, California, the land was reconveyed to the United States government by act of Congress in 1916 and is currently managed by the United States Bureau of Land Management.

Since 1916, the 18 counties where the O&C lands are located have received payments from the United States government at 50% share of timber revenue on those lands. Later, as compensation for the loss of timber and tax revenue decreased, the government added federal revenues. The governments of several of the counties have come to depend upon the O&C land revenue as an important source of income for schools and county services.


The most recent source of income from the lands was funded through an extension of the Secure Rural Schools and Community Self-Determination Act of 2000 which allocated $110 million to the counties. The act has been renewed each succeeding year at vastly reduced spending levels, most recently for $26 million in 2022.[2] In late 2013, the United States House of Representatives considered a bill that would resume the funding and increase timber harvests to provide additional income to the counties.[3]

Decline in timber revenue and revised Congressional action[edit]

In 1989, annual timber harvest revenue on federal forest land nationwide peaked at $1.5 billion.[27] Following that year, the impact of overharvesting and increased environmental concerns began to negatively impact timber sales on the O&C lands.[7] In 1994, the federal Northwest Forest Plan was implemented. Designed to guide forest management of federal lands while protecting old-growth forest habitat for endangered species such as the Northern spotted owl, the plan restricted the land available for timber harvest. By 1998, revenue on federal forest lands fell to a third of the peak 1989 revenue, with areas in the Northwest particularly hard-hit.[7][27]


To offset the effects of the loss of timber revenue, in 1993, President Bill Clinton proposed a 10-year program of payments, set at 85 percent of the average O&C Act payments from 1986 to 1990, and declining 3 percent annually.[28] These "spotted owl" or "safety net" payments were passed by Congress as part of the Omnibus Budget Reconciliation Act of 1993 (Pub. L.Tooltip Public Law (United States) 103–66).[27][28]


With the payments set to expire in 2003, work began in 1999 to seek an extension to the payments. The O&C counties joined with other rural counties (including 15 of Oregon's other 18 counties) that also faced falling timber revenues to lobby Congress for another solution.[17] In 2000, Congress passed the Secure Rural Schools and Community Self-Determination Act (Pub. L.Tooltip Public Law (United States) 106–393 (text) (PDF)), which authorizes western counties, including the O&C counties, to receive federal payments to compensate for loss of timber revenue until 2006. Payments to O&C counties, which included O&C revenue as well as revenue on Forest Service land, averaged about $250 million per year from 2000 to 2006.[28][29] The act was extended for one year in 2007, and in 2008, a four-year extension was included in the Emergency Economic Stabilization Act of 2008 that phased out the program by 2012.[6][30] The extension expired on September 30, 2011 and the final payment of just over $40 million was delivered to the O&C counties in early 2012.[31]


In late 2011, Oregon Senators Ron Wyden and Jeff Merkley proposed legislation to extend the payments for another five years. The move was backed by Governor John Kitzhaber and the entire Oregon congressional delegation.[32] Republican and Democratic members of Oregon's congressional delegation also proposed setting aside some of the federal land in Oregon as public trusts in which half would be designated for harvest to provide revenue for the counties, and half designated as a conservation area.[29] President Barack Obama's proposed 2013 United States federal budget included $294 million to extend the program for fiscal year 2013 with a plan to continue the payments for four more years, with the amount declining 10% each year.[33][34]


In March 2012, the U.S. Senate added an amendment to the surface transportation bill that authorized a one-year extension to the Secure Rural Schools and Community Self-Determination Act. Oregon counties would have received a total of $102 million from the legislation in 2012, to be divided among all 33 counties that currently receive payments. In 2008, Oregon received $250 million from the program.[35] The full transportation bill, including the amendment, passed the Senate by a 74–22 vote,[35][36] but the U.S. House of Representatives refused to vote on the Senate bill, instead passing a three-month extension to the current transportation bill that did not contain a county payments extension.[37] In July 2012, the Secure Rural Schools Act renewal amendment was included in the transportation bill approved by Congress and signed by the President.[38][39][40] This was widely expected to be the last renewal of the program,[38] but in September 2013, Congress passed another one-year extension to the program, though again at reduced levels.[41]

Future of the O&C counties[edit]

With future revenue uncertain, several Oregon counties now face a severe financial crisis to pay for county services, including law enforcement, social services, justice and corrections systems, election services and road maintenance among others.[26] With county services required by state law and bankruptcy not permitted, counties have considered merging to save costs, and explored new sources of revenue.[26]


One of the hardest-hit counties, Curry County, introduced a ballot measure to add a 3% sales tax to pay for county services.[42] Oregon is one of only five states in the United States with no county or state sales tax, and the tax has been voted down regularly by voters whenever it has been proposed (though some areas assess a gas tax, and two cities in tourist areas, Ashland and Yachats, assess a local tax on prepared food).[42] In Josephine County, after a proposed property tax increase to pay for law enforcement was defeated in May 2012, the sheriff's office reduced its staff by 2/3 and released inmates from the county jail to reduce spending.[43] Lane County released 96 prisoners from its prisons and laid off 40 law enforcement personnel to cut costs.[44]


In 2012, the Oregon Legislative Assembly passed a law to allow O&C counties to use timber funds previously reserved for road maintenance to pay for law enforcement patrols.[45]


In late 2013, the House passed a forest management bill co-sponsored by Oregon Representatives Peter DeFazio, Greg Walden, and Kurt Schrader that would include increased timber harvests on O&C lands along with resumption of some Secure Rural Schools funding.[3]