Federal Lands:

Fees for Communications Sites Are Below Fair Market Value

RCED-94-248: Published: Jul 12, 1994. Publicly Released: Jul 12, 1994.

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Pursuant to a congressional request, GAO reviewed the Forest Service's and the Bureau of Land Management's (BLM) administration of lands leased as communications sites, focusing on: (1) whether fees for the communications sites reflect fair market value; (2) a comparison of federal fees to nonfederal landowners' fees; (3) how legislative limits on federal fee increases have affected the government's ability to obtain fair market value; and (4) communication site management problems.

GAO found that: (1) annual fees are significantly below fair market value for the use of the communications sites because the Forest Service bases fees on a 40-year-old formula and BLM bases fees on outdated appraisals; (2) the agencies estimate that fair market fees would increase total revenues by over 500 percent; (3) state and private landowners generally base their fees on their lands' fair market value and charge more than the federal fees; (4) some state officials believe that the low federal fees depress the fair market value of state-owned sites and deprive the states of revenue; (5) the agencies and the communications industry have been unable to agree on the amount of fee increases, partly because of the industry's concerns regarding the higher fees' adverse impact on small rural broadcasters; (6) legislative limits on fee increases prevent the agencies from charging fair market fees; (7) the agencies lack complete and reliable program information needed to manage their communications sites; and (8) numerous unauthorized communications users are operating on the sites and the Forest Service has not performed annual site inspections to monitor user compliance.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Congress did not renew limits on fee increases for fiscal year 1995. However, the agencies have yet to implement a fee system which collects fair market value. As a result, no financial impact has been realized as yet from the relief granted by Congress.

    Matter: If fair market value is to be obtained for the use of the communications sites on federal lands, Congress should consider not renewing the current limits on fee increases. To minimize any impact that large increases in fees could have on the industry, Congress may wish to consider directing the agencies to develop a phased-in approach to moving to fees that reflect fair market value.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Forest Service implemented a new fee system in October 1995.

    Recommendation: The Secretaries of Agriculture and the Interior should continue to develop a fee system that ensures that fair market value is obtained for the use of their communications sites. The system should be implemented unless legislatively prohibited.

    Agency Affected: Department of Agriculture

  2. Status: Closed - Implemented

    Comments: In July 1994, BLM published a proposed new fee system in the "Federal Register." After it made some modifications, BLM implemented a new fee system in October 1995.

    Recommendation: The Secretaries of Agriculture and the Interior should continue to develop a fee system that ensures that fair market value is obtained for the use of their communications sites. The system should be implemented unless legislatively prohibited.

    Agency Affected: Department of the Interior

  3. Status: Closed - Implemented

    Comments: The Forest Service has changed the way it authorizes communication sites from issuing permits to every user of the site to issuing a lease to the facilities' owners. This has reduced the number of unpermitted users. However, the agency still does not have reliable program-wide information on the amount of fees generated from these sites. The agency intends to address this issue as part of a reengineering effort, but this may not be completed for a few years.

    Recommendation: The Secretaries of Agriculture and the Interior should improve management oversight of activities at the communications sites by developing information systems that, at a minimum, provide them with accurate and timely programwide information on the number and types of users and the total amount of fees generated from users at the sites.

    Agency Affected: Department of Agriculture

  4. Status: Closed - Implemented

    Comments: BLM now has a system in place which can determine the amount of fees being paid by owners of facilities at communication sites on its lands, and the number of authorizations for facilities at such sites.

    Recommendation: The Secretaries of Agriculture and the Interior should improve management oversight of activities at the communications sites by developing information systems that, at a minimum, provide them with accurate and timely programwide information on the number and types of users and the total amount of fees generated from users at the sites.

    Agency Affected: Department of the Interior

  5. Status: Closed - Implemented

    Comments: As part of the new fee system, the Forest Service will no longer issue permits to each communications user operating with the same communications tower. Instead, the Forest Service will have one overall lease to authorize all users operating out of the same tower. This will reduce the number of authorizations the Forest Service is required to issue and should reduce the number of unauthorized users.

    Recommendation: The Secretary of Agriculture should direct the Chief, Forest Service, to develop a strategy to ensure that unauthorized users are not operating on its sites and that the sites are properly maintained.

    Agency Affected: Department of Agriculture

 

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