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County votes to join class-action lawsuit; Local government becomes 13th in state to seek recovery of funds

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Chaves County is the 13th county to become a class-action party to a federal lawsuit seeking money from the federal government following a Thursday vote by commissioners. From right to left are Chair Robert Corn, Will Cavin, T. Calder Ezzell Jr., James Duffey and Jeff Bilberry. (Lisa Dunlap Photo)

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Chaves County could receive $80,000 or more now that it has joined a class-action federal lawsuit regarding federal monies due to counties.

The Chaves County Board of Commissioners voted Thursday after meeting briefly in a closed executive session to become the 13th county in New Mexico to opt into the lawsuit, Kane County, Utah vs. the United States, which has been filed in the U.S. Court of Federal Claims in Washington, D.C.

The lawsuit, which includes two cases consolidated into one, claims that counties with federal lands within their borders were wrongly denied the full amount of money due them from the U.S. Department of Interior for payments in lieu of taxes (PILT) for 2015, 2016 and 2017 because Congress did not fully fund the PILT program. Rather than pay taxes to counties on U.S. Forest Service, Fish and Wildlife or Bureau of Land Management lands, national parks, military installations or other federal projects, the federal government instead makes annual PILT payments.

A judge has already ruled twice in favor of the original litigant, Kane County, Utah, which originally filed in June 2017, finding that the U.S. government has a legal obligation to make full payments as provided by statute no matter what Congress appropriates, according to court documents and Alan Saltman, a partner with Smith, Currie and Hancock LLP in Washington, D.C.

According to court filings, the U.S. government asked for dismissal of the claims in both lawsuits, one of which covered 2015 and 2016 and the other which covered 2017. Attorneys for the Secretary of the Department of the Interior said the department was restricted in making payments by the funding provided by Congress.

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An email seeking comment from the Interior Department was not immediately returned by press time.

Saltman said that now regions of 49 states, Guam and Puerto Rico are in the process of deciding whether to opt-in, which they must do to recover money. (Rhode Island does not have eligible federal lands.) In New Mexico, 32 counties have federal lands and are eligible to participate, with about $1.5 million in underpayments recorded, Saltman said.

So far, 13 counties in New Mexico have chosen to join, including nearby Eddy and Otero counties. The amount underpaid Chaves County over the three-year period is $123,934, Saltman said.

Once the opt-in period expires Sept. 13, a request for attorney fees will be submitted to the court and ruled upon and then judgments awarded each party, with money coming from the federal “indefinite judgment fund.” A judgment is expected by the fall.

“The next question is, is the federal government going to appeal?” said Saltman. “The answer is, we don’t know for sure. Our guess is, they are not going to appeal but that is not a certainty.”

County Manager Stanton Riggs said that he anticipates that the county could receive $80,000 or more after attorney fees.

“We are going to get about $80,000 to $90,000, could be a little less or a little more but somewhere in that (range). We aren’t really out anything at that point,” he said. “We aren’t going to jeopardize any future payments or anything like that.”

Saltman also noted that Congress has increased the percentage of funding for PILT each year, from about 97.5 percent in 2015 to 100 percent in 2018.

“So Congress has gotten better about estimating what was needed for full funding, and that, to us, indicates that full funding was always intended by Congress,” he said.

Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 310, or at reporter02@rdrnews.com.