California's Payment-In-Lieu-of-Taxes (PILT) program was established in 1949 to offset adverse impacts to county property tax revenues that result when the state acquires private property for wildlife management areas. Fish & Game Code Section 1504 specifies that when income is derived directly from real property acquired and operated by the state as wildlife management areas, the Department of Fish & Wildlife (DFW) may annually pay the county in which the property is located an amount equal to the county taxes levied upon the property at the time title was transferred to the state. This payment has been suspended from time to time when the state budget was suffering from revenue shortfalls. Over time, this “arrearage” has added up to $8 million that, to date, remains unfunded by the state to PILT counties.
Currently, the program’s total monetary commitment to counties is $644,000, and, while modest, this commitment can be an important infusion to a county’s general fund. In some instances, the non-payment of State PILT (including the arrearages) has left a number of counties, small counties in particular, struggling to provide needed services to county residents – many of which are mandated by the state.
It should be noted that prior to 2015 the Fish and Game Code required the state to make this payment. This obligation was made permissive at that time over the objections of RCRC and other local government advocates. Since then, RCRC has advocated to restore language that makes State PILT payments to counties required (as opposed to permissive) and continues to be a legislative priority.
In addition, RCRC will continue to work through the legislative budget process to also appropriate the $8 million in PILT arrearages to 36 PILT counties, as well as ensure that payments are made in future years.
Staff: Mary-Ann Warmerdam