Oregon Public Broadcasting

Bankruptcy is a common way for people and companies to deal with dire financial straits.  But what happens when a government can’t pay its bills?

It’s a question many counties in rural Oregon are asking.  To find some answers, we sent correspondent Chris Lehman to Curry County on the southern Oregon coast.

When Commissioner Georgia Nowlin took office last year, the financial outlook was grim.

Georgia Nowlin:  “We had no patrol deputies in the budget, and we were still $400,000 short.”

Maggie Runyan gathers signatures for a home rule charter petition outside of the post office in Brookings

The situation isn’t any better now. Almost two-thirds of Curry County’s general fund comes from the federal government.

It’s the money the Feds pay out to counties with large amounts of untaxable public timber land.  It used to be that counties shared the revenue from logging on those lands.  When the timber market dried up, the Feds stepped in to prop up struggling counties.

It was supposed to be a temporary arrangement.  But Congress kept renewing it.

Some counties came to depend on it.  Now, the money is gone.

And Commissioner Nowlin is at wit’s end.

Georgia Nowlin:  “There is absolutely no fat to cut.”

The county is getting by this year by using money it stashed away from the last round of timber payments.  But with no agreement in place to extend the program, the county could run out of cash by next June.

And Nowlin is afraid that will mean huge layoffs of county workers, something that brings her to tears.

Georgia Nowlin:  “We’ve got some wonderful people working for us in this county right now. I mean they do an excellent job.  And to have them leave and not come back would be heartbreaking.”

But some Curry County residents don’t buy that sob story.  They say that commissioners like Nowlin have mismanaged money.  They’re so mad they’re trying to get a measure on the local ballot to overthrow the county government.

Signature gatherer:  “Are you a registered voter in Curry County?”

Here outside of a post office in Brookings, they’re making their pitch to local residents.

Ralph Martin is on the committee that’s trying to remove the entire board of commissioners and replace it with a five-member volunteer panel.  Martin says county leaders should have better prepared for the end of timber subsidies.

Ralph Martin:  “The money ran out last year and it was panic time.  It was like they never knew it was going to end.  I guess they figured the Federal government would just keep paying it forever.  Counties all over Oregon are finding out that’s not true now.”

Counties have tried to raise money on their own with tax increases.  In most places that’s gone over like a lead balloon.

Curry County may try again this year with a new tax that would be solely dedicated to law enforcement.

It’s something of a Hail Mary pass. But Paul Snider of the Association of Oregon Counties says it might be better than relying on Congress to approve another round of timber subsidies.

Paul Snider:  “At this point you can’t count on it.  You can hope that something will happen, and our Congressional delegation is just doing yeoman’s work on this all the time.  But we’re at the point now where you have to say look, what if.  What if it doesn’t happen.”

The answer to that varies.  Some counties can get by with belt-tightening.  But in other counties the situation is worse.

A recent report by a state task force listed 12 counties as being hardest hit.  Among those are Josephine, Lane, and Columbia Counties.  

So, can county governments declare bankruptcy?  Not really.

The options are for the state to step in, or to merge with surrounding counties. But the state has its own financial troubles, and with so many rural Oregon counties facing hard times, it’s unlikely any of them will want to shack up with a neighbor.

In Curry County, Commissioner Georgia Nowlin says county residents will have to step up.

Georgia Nowlin:  “No one likes additional taxes.  I don’t. And I understand.  What you have to understand is, are you getting value for the money.   That’s our only chance to help ourselves.”

And with no action from Congress at this point, helping themselves may be the only option left for cash-strapped Oregon counties.

Online:

State Task Force on Federal Forest Payments