The federal Payment in Lieu of Taxes (PILT) Program provides payments to local governments, typically counties and boroughs, which contain certain federally-owned lands known as "entitlement lands." PILT funds are intended to help local governments offset losses in property taxes due to nontaxable federal lands within their boundaries. The federal PILT formula calculates payments based upon the local government's population and acres of entitlement lands. Entitlement lands include lands in the National Park and National Forest systems, federal lands administered by the Bureau of Land Management, lands dedicated to federal water resources development projects, and lands withdrawn from the public domain in other categories.

What is the purpose of PILT?

The PILT Program compensates the local government for federal lands located within its area which restricts a community's ability to generate local revenues and often hinders community development opportunities. (See 31 U.S.C. 6901-6902 at FedLaw and 3 AAC 152.010 at The Alaska Administrative Code.

How much money is distributed annually to the unorganized borough?

The amount of PILT money available to distribute depends on the annual federal appropriation level. In FY10, Commerce distributed $9,925,513 to qualified cities located within the unorganized borough. Since 1997, Commerce has distributed nearly $75 million to cities under this program. (31 U.S.C. 6901-6902)

How does a city qualify for payment?

Cities in the unorganized borough are notified on March 1 each year of the administrative requirements. In order to receive its PILT, a city must submit an approved funding resolution, a copy of its current year operating budget, and a second preceding year audit or certified financial statement. For example, the FY08 audit or certified financial statement would be required in order to receive PILT funding in FY10.  A city must also conduct regular elections, hold regular meetings and keep a record of them, and codify its ordinances. (31 U.S.C. 6901-6902 and 3 AAC 152.100)

How does an organized borough receive its payment?

An organized borough receives its payment directly from the U.S. Department of Interior. Cities located within an organized borough are not eligible for funding. (31 U.S.C. 6901-6902)

How can PILT be used?
A local government may use PILT for any governmental purpose, including services related to public safety, the environment, housing, social services, transportation, and governmental administration. (31 U.S.C. 6901-6902 and 3 AAC 152.220)

When is PILT distributed?
The Department of Commerce, Community, and Economic Development distributes PILT funding in July of each fiscal year. (3 AAC 152.210)

How is a city's PILT amount calculated?
The PILT is based on population of each eligible city located within the boundaries of the census area. (3 AAC 152.200)

Forms

• PILT Funding Resolution (Adobe PDF)
• PILT Funding Resolution (Microsoft Word)

Internet Links

• U.S. Department of Interior, PILT
• Alaska Legislature "Folio Infobase" - Alaska Statutes
• Alaska Legislature "Folio Infobase" - The Alaska Administrative Code
• PILT Amounts to Alaskan Cities:  http://www.commerce.state.ak.us/dca/pub/FY2010PILT.xls
• PILT Requirements
• Alaska Dept of Commerce, Community, and Economic Development

Federal law

31 U.S.C 6901-6902 - FedLaw

Alaska Statutes
AS 44.33.020 - Commerce duties - "Folio Infobase" - Alaska Statutes

Alaska Administrative Code
The Alaska Administrative Code

• 3 AAC 152.010 - Purpose
• 3 AAC 152.100 - Eligibility requirements
• 3 AAC 152.200 - Calculation of payment in lieu of taxes allocations
• 3 AAC 152.210 - Distribution of payments
• 3 AAC 152.220 - Use of payments
• 3 AAC 152.900 - Definitions

Revised 8/10/2009