Minnesota’s Senators introduce bill to boost funds for Boundary Waters counties

Minnesota U.S. Senators Tina Smith and Amy Klobuchar re-introduced a critical piece of legislation – the Thye-Blatnik Amendment.

This Amendment would provide a significant and stable source of funding for the Boundary Waters counties—Lake, St. Louis, and Cook—ensuring financial support for key community projects like road maintenance and public services.

This Amendment passed in the U.S. Senate last year but stalled in the House.

We can’t let that happen again this year. For generations the Thye-Blatnik Act has provided essential funding to counties impacted by federal land ownership in the Boundary Waters Canoe Area Wilderness. But outdated appraisal methods threaten to shortchange these communities, depriving them of much-needed resources. Recognizing this, the Senators took action—and dedicated their time and resources to reevaluating outdated Thye-Blatnik appraisal methods, which we elaborate on below. Her tireless efforts reflect a deep dedication to ensuring that Northeastern Minnesota counties receive the fair, stable funding they deserve to thrive and support their residents.

How does Thye-Blatnik work?

For more than 75 years, the Thye-Blatnik Act has provided financial support to the three northeastern Minnesota counties (Lake, St. Louis, and Cook) affected by federal ownership of lands within the Boundary Waters Canoe Area Wilderness (BWCAW), which are exempt from property taxes. Thye-Blatnik payments-in-lieu of taxes have funded vital projects in local communities, from road and bridge maintenance to health and human services. However, the current appraisal system leaves communities vulnerable to funding cuts—an issue highlighted by a 2018 appraisal that threatened to slash annual county payments by nearly $2 million.

In 1948, Congress passed the Thye-Blatnik Act. The Act directed the Secretary of Agriculture to acquire lands within the future Boundary Waters Canoe Area Wilderness. In return, annual payments in lieu of taxes based on the value of federal lands were promised to the three Boundary Waters counties of St. Louis, Lake, and Cook.

Senator Smith and Klobuchar’s Amendment would lock in Thye-Blatnik payment levels at the historic high appraisal value while implementing future reappraisals to ensure that Thye-Blatnik PILT payments either remain steady or increase—never decrease. The Amendment would allow the critical revenue funds to keep streaming into the counties.

The impact on State School Trust Lands:

These annual payments to the counties would also increase after the sale of approximately 80,000 acres of state school trust lands located within the Boundary Waters by the State of Minnesota to the Forest Service. In addition to adding to Thye-Blatnik payments, the sale of the school trust lands will immediately deliver about $33 million of federal funds to the State Permanent School Fund, providing payments in perpetuity to Minnesota’s school children. In 40 years, sale proceeds of $33 million will grow to $528 million (based on the earnings on the Permanent Fund over the past 10 years). Congress has fully appropriated funding for the purchase of the Boundary Waters school trust lands.

Approximately $150 million has been paid to the counties since 1948. As additional lands within the Boundary Waters are acquired by the Forest Service, they are added to the Thye-Blatnik payment system, increasing annual amounts paid to the three counties at the next 10-year adjustment.

Unfortunately, Representative Stauber opposes the sale of the Boundary Waters school trust lands and instead argues for a land exchange that would generate only $33 million from logging revenues (based on the DNR’s contributions to the Fund from logging on state school trust lands) to the Permanent School Fund after the same 40 years. The choice is - after 40 years of investment growth - $528 million (sale to the Forest Service) or $33 million (logging receipts after a land exchange) for public education.

What’s next for the Senators’ Amendment? It needs to pass the U.S. Senate and the U.S. House. Rep. Stauber’s inaction last year deprived his own constituents of the financial stability they deserved. Let’s not let him make the same mistake again.

How can you help? If you live in Northeastern Minnesota, call Rep. Stauber and make sure he knows you want him to support this crucial non-partisan piece of legislation: (202) 225-6211