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Formula Change Said To Cost Districts Millions

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A proposed change in the U.S. Forest Service's formula for distributing federal aid in lieu of local taxes would cost school districts a total of some $43 million, according to the National School Boards Association.

In testimony this month before a House subcommittee, E. Harold Fischer, an N.S.B.A. board member, said the change would result in "a loss of much-needed tax revenues for local government services, including the public schools.''

Because federal lands are exempt from property taxes, the Forest Service compensates localities adjacent to national forests by providing funds for schools and roads. The aid is allocated from payments by logging and mining firms and othercompanies that pay the federal government for the use of forest land.

Currently, the aid payments are based on gross receipts--the total before the Forest Service has deducted the cost of the services it provides to private firms. The proposed formula would be based on net receipts, which the N.S.B.A. says would result in a 43 percent drop in aid payments.

Because most states reduce funding to school districts that receive the federal money, the cuts may force states to direct money away from other districts to cover the shortfall, Mr. Fischer noted. "Any reduction in Forest Service payments negatively impacts the funding for education in all school districts within the state,'' he said.--W.M.

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