oversight

Recreation Fees: Information on Forest Service Management of Revenue from the Fee Demonstration Program

Published by the Government Accountability Office on 2003-09-17.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                 United States General Accounting Office

GAO                              Testimony
                                 Before the Subcommittee on Forests and
                                 Forest Health, Committee on Resources,
                                 House of Representatives

For Release on Delivery
Expected at 2:00 p.m. a.m. EDT
Wednesday, September 17, 2003    RECREATION FEES
                                 Information on Forest
                                 Service Management of
                                 Revenue from the Fee
                                 Demonstration Program
                                 Statement of Barry T. Hill, Director
                                 Natural Resources and Environment




GAO-03-1161T
                                                  September 17, 2003


                                                  RECREATION FEES

                                                  Information on Forest Service
Highlights of GAO-03-1161T, testimony
before the Subcommittee on Forests and
                                                  Management of Revenue from the Fee
Forest Health, Committee on Resources,
House of Representatives
                                                  Demonstration Program



 Since 1996, federal land                         Local forest managers largely determine Forest Service spending priorities
 management agencies have                         for the Recreational Fee Demonstration Program. Given broad discretion in
 collected over $900 million in                   deciding how to use fee demonstration revenues, local forest managers
 recreation fees from the public                  retain between 90 and 100 percent of the fee demonstration revenue at the
 under an experimental initiative                 sites where fees are collected and are expected to establish spending
 called the Recreational Fee
 Demonstration Program. The
                                                  priorities consistent with general program guidance provided by Forest
 Forest Service’s part was about                  Service headquarters. This guidance advises local forest managers to spend
 $160 million. The authority to                   fee demonstration revenues on needs that have been identified by forest
 collect these fees expires at the end            visitors and to maintain existing facilities rather than initiate new
 of fiscal year 2004. Central to the              construction projects.
 debate about whether to
 reauthorize the program is how                   On the basis of priorities identified by local users, the Forest Service has
 effectively the land management                  spent fee demonstration revenues on a wide range of projects at national
 agencies are using the hundreds of               forests throughout the country. The legislation authorizing the fee
 millions of dollars that the                     demonstration program permitted all the participating agencies to spend fee
 recreation fees have provided                    revenues on certain categories of activities to increase the quality of the
 them. In April 2003, GAO reported
 on Forest Service management of
                                                  visitor experience and enhance the protection of resources. GAO’s review at
 the fee demonstration program.                   selected Forest Service sites found that expenditures were consistent with
 (See Recreation Fees: Information                authorizing legislation and agency spending priorities.
 on Forest Service Management of
 Revenue from the Fee                             The Forest Service does not have a process for measuring the impact of fee
 Demonstration Program, GAO-03-                   demonstration expenditures on reducing the deferred maintenance backlog.
 470 [Washington D.C.: Apr. 25,                   Further, while the agency acknowledges that it has a significant deferred
 2003]).                                          maintenance problem, it has not developed a reliable estimate of its deferred
                                                  maintenance needs.
 This testimony is based on the
 work GAO conducted for the April                 Consistent with the authorizing legislation for the fee demonstration
 2003 report. Four issues are
 addressed: (1) how the Forest
                                                  program, the Forest Service keeps its fee revenue in accounts separate from
 Service determines spending                      other appropriated funds. The agency also tracks its fee revenues and
 priorities for the revenues                      expenditures separately from its appropriated funds.
 generated by the fee program, (2)
 how the agency has spent its fee
 demonstration program revenues,
 (3) what the agency is doing to
 measure the impact of the
 recreation fee revenues on
 reducing its deferred maintenance
 backlog, and (4) how it accounts
 for its fee demonstration program
 revenues.


 www.gao.gov/cgi-bin/getrpt?GAO-03-1161T.

 To view the full product, including the scope
 and methodology, click on the link above.
 For more information, contact Barry T. Hill at
 (202) 512-3841 or hillbt@gao.gov.
Mr. Chairman and Members of the Subcommittee:

I am pleased to be here today to discuss our most recent report on the
Forest Service’s management of the Recreational Fee Demonstration
Program.1 Since 1996, federal land management agencies have collected
over $900 million in recreation fees from the public under an experimental
initiative called the Recreational Fee Demonstration Program. The Forest
Service’s part is about $160 million. The Forest Service is one of the four
federal land management agencies authorized by Congress to charge fees
to visitors and to retain the revenues for use in addition to other
appropriated funds.2 The Congress originally authorized the program for 3
years and has extended it several times. The authority to collect these fees
currently expires at the end of fiscal year 2004.

As the program enters its seventh year, the fees continue to be
controversial at some sites, and critics question the extent to which
program expenditures directly benefit visitors. Many of the concerns
involve the Forest Service, which, unlike the National Park Service, had
not historically charged fees to enter its public lands or to use amenities
such as trails prior to the fee demonstration program. Moreover, the
Forest Service introduced a variety of new recreation fees aimed at a
range of visitor uses, including fees for dispersed recreation, such as trail
access or backcountry camping, or for general access. Although this
experimentation provided valuable information about the types of fees
that were feasible, it also fueled questions about the Forest Service’s
administration of the program. Accordingly, as you requested, my
testimony today will address the following issues: (1) how the Forest
Service determines spending priorities for the revenues generated by the
fee program; (2) how the agency has spent its fee demonstration program
revenues; (3) what the agency is doing to measure the impact of the
recreation fee revenues on reducing its deferred maintenance backlog; and
(4) how it accounts for its fee demonstration program revenues.




1
U.S. General Accounting Office, Recreation Fees: Information on Forest Service
Management of Revenue from the Fee Demonstration Program, GAO-03-470 (Washington,
D.C: Apr. 25, 2003).
2
The other three land management agencies authorized to charge fees under the
Recreational Fee Demonstration Program are the National Park Service, the Fish and
Wildlife Service, and the Bureau of Land Management.



Page 1                                                                   GAO-03-1161T
                   Local forest managers largely determine Forest Service spending priorities
Results in Brief   for the Recreational Fee Demonstration Program. Given broad discretion
                   in deciding how to use fee demonstration revenues, local forest managers
                   retain between 90 and 100 percent of the fee demonstration revenue at the
                   sites where fees are collected. Local managers are expected to establish
                   spending priorities consistent with general program guidance provided by
                   Forest Service headquarters. This guidance advises local managers to
                   spend fee demonstration revenues on needs that have been identified by
                   forest visitors; it also directs local managers to spend the resources on
                   maintaining existing facilities rather than initiating new construction
                   projects.

                   On the basis of priorities identified by local users, the Forest Service has
                   spent fee demonstration revenues on a wide range of projects at national
                   forests throughout the country. The legislation authorizing the fee
                   demonstration program permits the participating agencies to spend fee
                   revenues on a broad range of activities aimed at increasing the quality of
                   the visitor experience and enhancing the protection of resources such as
                   providing visitor services, maintaining and enhancing facilities, fee
                   collections, and enforcing laws. To verify how the fee revenue was being
                   spent we visited a number of Forest Service sites across the country and
                   found that expenditures were consistent with the authorizing legislation
                   for the program and agency spending guidance and priorities.

                   The Forest Service has not developed a process for measuring the impact
                   of fee demonstration expenditures on reducing the deferred maintenance
                   backlog. According to agency officials, there are several reasons for this—
                   for example, the temporary status of the program and the fact that the
                   legislation establishing the program does not require that the impact be
                   measured. Further, while officials acknowledge that the Forest Service has
                   a significant deferred maintenance problem, the agency has not developed
                   a reliable estimate of its deferred maintenance needs.

                   Consistent with the authorizing legislation for the fee demonstration
                   program, the Forest Service keeps its fee revenue in Treasury accounts
                   separate from other appropriated funds. The agency also tracks its fee
                   revenue and expenditures separately from its appropriated funds.


                   The Forest Service is responsible for managing over 192 million acres of
Background         public lands in the United States. In carrying out its responsibilities, the
                   Forest Service has traditionally been a decentralized organization, whose



                   Page 2                                                          GAO-03-1161T
                       programs are administered through nine regional offices, 155 national
                       forests, and over 600 ranger districts (each forest has several districts).

                       The Forest Service began implementing the Recreational Fee
                       Demonstration Program in fiscal year 1996 with four demonstration sites
                       that generated a total of $43,000 during the year.3 The program has steadily
                       grown over the past 6 years and now covers 92 sites in 114 national forests
                       and grasslands. These sites generated about $38 million in revenue in fiscal
                       year 2002. A demonstration site may consist of an individual forest; a
                       group of forests, such as the National Forests in Texas; or a specific area
                       or activity within a forest, such as Mount St. Helens National Volcanic
                       Monument in the Gifford Pinchot National Forest in Washington.


                       Spending priorities for the Recreational Fee Demonstration Program are
Local Forest Service   largely determined by local forest managers who are given broad
Officials Determine    discretion in deciding how to use fee demonstration revenues. Forest
                       Service headquarters provides general program guidance that advises the
Spending Priorities    local managers to focus their spending priorities on two things. First, local
                       managers are to identify what the visitors want because the Forest Service
                       believes that users will more likely accept having to pay fees if they see
                       that their money is spent on improving services in the forests they visit.
                       Second, existing facilities such as restrooms and visitor centers should be
                       maintained because the agency prefers to use fee revenue to maintain
                       such facilities rather than to initiate new capital projects that would
                       increase its inventory of assets and add to operating and maintenance
                       costs.

                       In the three Forest Service regions that we visited, local forest managers
                       told us that they establish priorities on the basis of visitor desires that are
                       identified through visitor comment cards, visitor surveys, local user




                       3
                        Although the Forest Service refers to fee demonstration sites as projects throughout this
                       statement, we call them sites. Under the original Recreational Fee Demonstration Program
                       legislation, between 10 and 50 sites per agency were permitted to establish, charge, and
                       collect recreation fees (P.L. 104-134, title III, Sec. 315 [1996]). In fiscal year 1997
                       appropriations, the Congress increased the number of authorized sites to 100 per agency
                       (P.L. 104-208, title III, Sec. 319 [1996]). In fiscal year 2002 appropriations, the Congress
                       eliminated the 100 demonstration sites per agency limitation (P.L. 107-63, title III, Sec. 312
                       (b)[2001]).



                       Page 3                                                                        GAO-03-1161T
                     groups, associations, and regional boards.4 According to these officials,
                     visitors generally desire spending priorities that address health and safety
                     needs; maintenance needs; and improved visitor services, such as
                     interpretative services.

                     Further, local forest managers told us that visitors expect that fee
                     demonstration revenues be retained and used at the sites where fees are
                     collected. In this regard, the Forest Service retains between 90 and 100
                     percent of fee revenues for use at the collection sites. The portion of fee
                     revenues that is not retained on site is used by the regional offices for a
                     variety of program-related activities, such as providing start-up money for
                     new demonstration sites, providing fee demonstration program signs and
                     brochures, initiating regional pass sales, and supporting marketing
                     activities.


                     In the authorizing legislation for the Recreational Fee Demonstration
Revenues Are Spent   Program, the Congress provided the Forest Service and the other land
on a Wide Range of   management agencies broad authority in deciding how to spend fee
                     demonstration revenues. The 1996 authorizing legislation5 permitted the
Activities           agencies to spend fee demonstration revenues for: backlogged repair and
                     maintenance projects, interpretation, signage, habitat or facility
                     enhancement, resource preservation, annual operation (including fee
                     collection), maintenance, and law enforcement relating to the public use
                     of lands. Our analysis at a sample of sites participating in the fee
                     demonstration program showed that fee revenue was being spent on a
                     wide range of projects that were consistent with the authorizing legislation
                     the program and agency spending priorities. For fiscal year 2001, the
                     Forest Service reported that it collected about $35 million in fees and
                     spent about $29.3 million, with about half of the expenditures going
                     toward visitor services and operations and maintenance activities.

                     We reviewed the activities at a sample of demonstration sites in three
                     Forest Service regions that have generated the most revenue to determine




                     4
                      Regional boards, which consist of members with recreation, forest, law enforcement,
                     fiscal, and economic backgrounds, are used to help oversee the fee demonstration program
                     within each region of the Forest Service.
                     5
                      Omnibus Consolidated Rescissions and Appropriations Act of 1996, P.L. No. 104-134, title
                     III, Sec.315(c)(3).



                     Page 4                                                                     GAO-03-1161T
                       how funds were spent, the appendix lists the specific regions and sites we
                       visited. The types of projects being funded at the sites we visited included

                   •   constructing a boat launch area along the Nantahala River, a world-class
                       whitewater river that attracts about 250,000 people annually in the
                       National Forests of North Carolina;

                   •   operating a wastewater treatment plant that serves the visitor center at
                       Multnomah Falls, located within 30 miles of Portland, Oregon, and one of
                       the most popular attractions in the Columbia River Gorge National Scenic
                       Area, which receives over 2 million visitors per year; and

                   •   acquiring fire rings, cooking grills, and picnic tables at Kisatchie National
                       Forest in Louisiana to improve campground services.

                       On the basis of our review and on-site observations, we found that the fee
                       demonstration program expenditures were consistent with the legislative
                       authority provided for the program and with agency spending priorities.


                       The Forest Service has used a portion of its fee program revenues to help
The Forest Service     address its deferred maintenance backlog. However, the agency does not
Has No Process for     have a process for measuring how much has been spent on deferred
                       maintenance or the impact of the fee revenue program has had on
Measuring the Impact   reducing its deferred maintenance needs. In addition, while the agency
of Fee Revenues on     acknowledges that it has a significant deferred maintenance problem, it
                       has not developed a reliable estimate of its deferred maintenance needs.
Deferred Maintenance   As a result, even if the agency knew how much fee revenue it spent on
                       deferred maintenance, it would not know the extent to which its total
                       deferred maintenance needs were being reduced.

                       The legislation authorizing the Recreational Fee Demonstration Program
                       permits the Forest Service and the other participating agencies to spend
                       fee revenues on deferred maintenance needs. In fact, at each of the
                       locations we visited, the site managers told us that they were using a
                       portion of fee revenues to implement a variety of projects that addressed
                       deferred maintenance needs such as replacing worn and rotted picnic
                       tables at a campground in Klamath National Forest in California, fixing
                       eroded hiking trails in the Nantahala Gorge in the North Carolina National
                       Forest, and replacing deteriorating restrooms in Kisatchie National Forest
                       in Louisiana.




                       Page 5                                                           GAO-03-1161T
Forest Service officials told us that there are a number of reasons why the
agency has not developed a process to track deferred maintenance
expenditures from fee demonstration revenues. First, the agency chose to
use its fee demonstration revenue to improve and enhance on-site visitor
services rather than to use its revenue in developing and implementing a
system for tracking deferred maintenance spending. Second, because the
fee demonstration program is still temporary, agency officials said that
they have concerns about developing an additional process for tracking
deferred maintenance. Finally, the agency faced no specific requirement
was to measure the impact of fee revenues on deferred maintenance.

Forest Service officials acknowledge that the agency has a significant
deferred maintenance problem. In fiscal year 2001, the agency estimated
that its total deferred maintenance backlog was in the billions of dollars,
most of which was for forest roads and bridges. According to the Forest
Service, the recreation-related component of this estimate was in the
hundreds of millions of dollars.

However, in March 1999, the Department of Agriculture’s Inspector
General testified that the Forest Service did not have a reliable estimate of
the amount of its deferred maintenance backlog.6 Further, the Inspector
General pointed out that the agency had no systematic method for
compiling the information needed to provide managers or the Congress
with reliable estimates. Although the Forest Service has since
implemented an initiative to help gather and develop better information on
the amount of its deferred maintenance backlog, the findings of the
Inspector General’s report are still valid. Forest Service officials
acknowledge that they are still in the process of developing a reliable
estimate of the agency’s deferred maintenance backlog.




6
 Testimony of Roger Viadero, Inspector General, U.S. Department of Agriculture, before the
Committee on Agriculture, Subcommittee on Department Operations, Oversight, Nutrition,
and Forestry, House of Representatives, Concerning the Financial Accountability of the
Forest Service (Mar. 11, 1999).



Page 6                                                                    GAO-03-1161T
                        The authorizing legislation for the fee demonstration program requires the
The Forest Service      participating federal agencies to maintain fee revenue in separate Treasury
Accounts for Its Fee    accounts and to account for fee expenditures separately from other
                        appropriated fund expenditures. Consistent with the requirement, the
Demonstration           Forest Service maintains its fee revenues in separate Treasury accounts
Program Revenues        and tracks fee revenue and expenditures separately from other
                        appropriated funds. For example, officials at the Gifford Pinchot National
and Expenditures        Forest in the Pacific Northwest Region used a combination of fee
Separately from Other   demonstration revenues and other appropriated funds to replace a bridge
Funds                   on the Pacific Crest National Scenic Trail in 2001. For this project, agency
                        officials accounted for revenues and expenditures from the fee
                        demonstration program separately from the revenues and expenditures
                        from other appropriated funding sources.


                        Mr. Chairman, this concludes my prepared statement. I would be happy to
                        respond to any questions that you or Members of the Subcommittee may
                        have.


                        For further information about this testimony, please contact me at (202)
GAO Contacts and        512-3841. Nancy Crothers, Cliff Fowler, Amy Webbink and Arvin Wu made
Staff                   key contributions to this statement.
Acknowledgments




                        Page 7                                                         GAO-03-1161T
Appendix: Demonstration Sites Visited



                  Region/sites visited                                 State
                  5—Pacific Southwest
                  Enterprise Forest Projecta                           California
                  Shasta-Trinity National Forests (Shasta-
                    Trinity National Recreation Area)                  California
                  Klamath National Forest                              California
                  6—Pacific Northwest
                  Gifford Pinchot National Forest (Mount St.
                    Helens National Volcanic Monument)                 Washington
                  Columbia River Gorge National Scenic
                    Area (Multnomah Falls)                             Washington and Oregon
                  Colville National Forest                             Washington
                  8—Southern
                  North Carolina National Forests                      North Carolina
                  Kisatchie National Forest                            Louisiana
                  Texas National Forests                               Texas
              Source: GAO based on Forest Service data.

              Note: We did not visit the Kisatchie National Forest site because it was closed due to a hurricane at
              the time we were conducting our fieldwork. We did, however, obtain documentation from the site
              manager on each of our review objectives.
              a
              The Enterprise Forest project covers four national forests in Southern California: the Angeles,
              Cleveland, Los Padres, and San Bernardino forests. We visited the Angeles and San Bernardino
              National Forests.




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              Page 8                                                                                GAO-03-1161T
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