Mountain communities hemmed in by federally owned land, namely national forests and parks, are at an economic disadvantage, according to N.C. Rep. Roger West, R-Marble.

West testified in Washington, D.C., last month at a special hearing called “Impacts of Federal Ownership on Communities and Local Governments” held by the Congressional subcommittee on Forests and Forest Health.

“Federal ownership in and around my district is a dominating force economically, socially and environmentally,” West said. “Today, we have mixed feelings about our federal neighbors.”

Counties have historically been compensated by the government for land under federal ownership. The rationale: if the land was in private hands, the county would be collecting property taxes from it. The compensation became known as “payment in lieu of taxes,” or PILT.

As the county manager and finance director for Swain County — where 86 percent of the land is federally owned — Kevin King was concerned about plans by Congress to cut PILT payments. PILT money made up 4.5 percent of Swain’s $7.9 million budget last year and is a significant portion of the tax base in many Western North Carolina counties. Swain would have been forced to raise taxes or cut services to make up the difference. But thanks to lobbying, the plan to cut PILT money was reversed.

“They were going to cut them back about $12 million. Instead they added $12 million to it,” said King. The extra money in the PILT coffers was divvied up among counties nationwide.

Swain County got $347,000 this year from PILT payments, which comes out to $1.45 per acre of federal land — a fraction of what the county would collect in taxes on the land if it was privately owned. A one-acre homesite in Swain County has an average value of more than $20,000. At their tax rate of 33 cents, the county would collect $66 per acre for unoccupied land — far more if there was a house on it.

This discrepancy between PILT and the tax rate was one of West’s core arguments before Congress.

“Because of the attractiveness of our mountain environment and scarce availability of private ownership, our private property valuations have increased exponentially in the last couple of decades while the contributions of federal ownership through PILT have not kept pace,” West said.

West represents Cherokee, Graham, Clay and part of Macon in the North Carolina House of Representatives.

Some argue that PILT payments are obsolete. Counties collect property taxes from residents in order to provide government services, from running landfills to holding court. Although counties don’t collect property taxes from federally owned land, they also don’t have to provide county services.

But government officials from counties with a large percentage of federally owned land say it is a burden to county resources.

King, Swain County manager, said the Great Smoky Mountains National Park, for example, attracts hundreds of thousands of tourists to Swain County. They put wear and tear on the roads, they generate trash and recyclables that the county must dispose of, and they get hurt and call 911.

West made this same point to Congress.

“My constituents pay higher taxes to compensate for lagging federal commitments in order to maintain and develop the necessary infrastructure and services to support our communities,” West said. “The bottom line is that my counties do not recoup from federal revenue-sharing the increased costs for infrastructure and services such as law enforcement, search and rescue, and fire protection directly related to federal ownership.”

Thorns of federal ownership

West claimed there was another economic disadvantage to national parks and forests — all the environmental scrutiny that comes with the territory.

“Because of the proximity of my counties to designated wilderness areas on national forests and the Great Smoky Mountain National Park, any commercial or industrial development has far more scrutiny,” West said, calling industrial recruiting “a nightmare for local governments.”

West also complained about a dramatic reduction of logging in national forests.

“Again, this is the direct result of the whining of environmental zealots and lack of backbone in national forest leadership,” West said.

In addition to PILT payments, counties get 25 percent of the proceeds made on logging in national forests. The reduction in logging means this revenue has shrunk, but more so, it has also hurt the logging industry, West said.

West also criticized the national forest service for limiting collection of wild medicinal herbs and other plant commodities due to concerns about over-harvesting.

“Since our country’s humble beginnings the abundance of natural resources has been the cornerstone for our remarkable economic and social development. Unfortunately, in areas dominated by federal ownership, we are now hobbled by federal agencies focused on preserving rather than conserving these valuable resources,” West said.

West did not go into detail on the economic benefits derived from protecting national forests and parks. The region’s number one industry — tourism — relies on the outdoor scenery. Outdoor recreation is a major industry unto itself, from kayaking to family camping. The booming second-home industry is also at least partially attributed to the vast tracts of protected mountainsides that make living here desirable.

West made only one passing reference to potential benefits of federal land.

“It can be argued that federal ownership is an asset and drawing card for our area. I agree that there are some benefits for public ownership that make our area an attractive place to live and play,” West said. “However, the people who live in my district deserve a fair chance in competing for an improved quality of life and economic development. It is my experience that having these large federal neighbors is a burden for local communities as they strive to improve their conditions.”