Montana counties would get substantially more money under a payment package announced Tuesday by Sen. Max Baucus, D-Mont.

Flathead County's annual payment would be nearly $1 million more than it got in 2006 under the Secure Rural Schools and Community Self-Determination Act.

Lincoln County's payment initially would increase by more than $2 million.

Along with Senate Majority Leader Harry Reid, D-Nev., and Sen. Ron Wyden, D-Ore., Baucus announced a plan that would authorize $2.8 billion to extend the county payments program through 2011. The program was started six years ago to compensate rural timber counties faced with shrinking revenues as a result of a steep decline in timber harvest on national forest lands.

"The long and short of it is we in western states have a lot of federal land … that cannot be taxed for roads and emergency services," Baucus said, explaining the program during a conference call with media Tuesday.

Montana counties and schools collectively would get $151.6 million over the five-year period, a $65 million increase over the past five years, according to a spreadsheet reporting estimated payments. The spending is being authorized for the first year in a supplemental appropriations budget that will be amended to extend the program over five years.

Baucus was cagey about discussing where the funding would come from, other than saying it involves closing loopholes in the federal tax code.

"Frankly, I don't want to divulge what [the loopholes] all will be at this point," said Baucus, who chairs the Senate Finance Committee.

Reid explained further that "we don't want to see the administration take the money to pay for their priorities and leave rural communities with the scraps."

The Bush administration had proposed selling off isolated tracts of Forest Service lands to pay for the program, but that plan encountered widespread opposition from both Republicans and Democrats.

When Congress failed to come up with a successful alternative last December, rural counties and school districts across the country were highly concerned because the program expired at the end of the year.

Reid noted that currently there is no funding for the program.

"We have created a lifeboat to keep rural communities afloat," Wyden said. "It couldn't have come at a more critical time."

The largest increase in payments nationwide would come in the first year, with gradual reductions over the five-year period.

Flathead County would receive $2.5 million in 2007 and $1.8 million by 2011, with receipts totaling $11.3 million over five years.

Lincoln County would get just over $8 million in 2007 and $5.8 million by 2011, for a total of $35.5 million over five years.

The payments account for a substantial part of road department budgets in Flathead and Lincoln counties.

Reporter Jim Mann may be reached at 758-4407 or by e-mail at [email protected]