Forest Service:

Barriers to Generating Revenue or Reducing Costs

RCED-98-58: Published: Feb 13, 1998. Publicly Released: Feb 23, 1998.

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Pursuant to a congressional request, GAO reviewed: (1) the efforts by nonfederal land managers to generate revenue or become financially self-sufficient from the sale or use of natural resources on their lands; and (2) legal and other barriers that may preclude the Forest Service from implementing similar efforts on its lands.

GAO noted that: (1) the nonfederal land managers whose efforts GAO reviewed--while not always attaining financial self-sufficiency--are using a variety of sometimes innovative approaches and techniques to generate revenue or reduce costs from the sale or use of natural resources on their lands; (2) none of the approaches or techniques are legislatively mandated or otherwise required; (3) rather, the land managers have: (a) usually tailored their efforts to meet either a clear mission to make a profit over time or an incentive to generate revenue for other mission-related goals and objectives; and (b) often been delegated the discretion and flexibility to explore innovative entrepreneurial ideas or conduct research to increase profits and to choose where and when to apply the results while being held accountable for their expenditures and performance; (4) generating revenue and reducing costs are not mission priorities for the Forest Service; (5) in keeping with its existing legislative framework, the agency is moving away from, rather than toward, financial self-sufficiency; (6) increasingly, legislative and administrative decisions--such as setting aside an increasing percentage of Forest Service lands for conservation as wilderness, wild and scenic rivers, and national monuments--and judicial interpretations of statutory requirements have required the Forest Service to shift its emphasis from uses that generate revenue to those that do not; and (7) furthermore: (a) the agency is required to continue providing certain goods and services--such as recreational sites, hardrock minerals, and livestock grazing--at less than their fair-market value; and (b) certain congressional expectations and legislative provisions--including those that require sharing revenue before deducting the costs of providing the goods or services--serve as disincentives to either increasing revenue or decreasing costs.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Matter for Congressional Consideration

    Matter: If Congress believes that increasing revenue or decreasing costs from the sale or use of natural resources should be mission priorities for the Forest Service, it will need to work with the agency to identify legislative and other changes that are needed to clarify or modify Congress's intent and expectations for revenue generation relative to ecological, social, and other values and concerns.

    Status: Closed - Not Implemented

    Comments: The only bill introduced during the 106th Congress that would make clear the Congress' intent and expectations for revenue generation relative to ecological, social, and other values and concerns would make clear that the Forest Service's overriding mission priority is ecosystem sustainability and would acknowledge the effects of sustaining ecosystems on the availability of other uses on the national forests. Similarly, proposed new planning regulations, which the agency expects to finalize by the end of 2000, would make clear that ecological sustainability is the Forest Service's highest priority and that the flow of products, services, and other values from the national forests will be limited to those consistent with maintaining or restoring ecosystem integrity. Thus, it is clear that generating revenue is not a mission priority for the Forest Service.

    Recommendation for Executive Action

    Recommendation: Because the Forest Service has not exercised its authority to obtain fair-market value for certain goods and to recover costs for certain services and has not always acted to contain costs, even when requested to do so by Congress, the Secretary of Agriculture should direct the Chief of the Forest Service to revise the strategic plan that the agency developed to comply with the requirements of the Government Performance and Results Act to include goals and performance measures for obtaining fair-market value for goods, recovering costs for services, and containing expenses as the necessary first step in holding the Forest Service accountable for its performance.

    Agency Affected: Department of Agriculture

    Status: Closed - Not Implemented

    Comments: The Forest Service agreed with this recommendation. However, the agency's October 2000 revision to its strategic plan does not include any goals or performance measures for obtaining fair market value for goods, recovering costs for services, or containing expenses. Rather, the agency's November 2000 planning regulations make clear that ecological sustainability is its highest priority and that the flow of products, services, and other values from the national forests will be limited to those consistent with maintaining or restoring ecosystem integrity.

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