oversight

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

Published by the Government Accountability Office on 2003-04-25.

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

             United States General Accounting Office

GAO          Report to the Chairman, Subcommittee
             on Forests and Forest Health, Committee
             on Resources, House of Representatives


April 2003
             RECREATION FEES
             Information on Forest
             Service Management
             of Revenue from the
             Fee Demonstration
             Program




GAO-03-470
             a
                                                 April 2003


                                                 RECREATION FEES

                                                 Information on Forest Service
Highlights of GAO-03-470, a report to the
Chairman, Subcommittee on Forests and            Management of Revenue from the Fee
Forest Health, Committee on Resources,
House of Representatives                         Demonstration Program


Since 1996, federal land                         The Forest Service largely determines its spending priorities for the
management agencies have                         Recreational Fee Demonstration Program through local forest managers
collected over $900 million in                   who are given broad discretion in deciding how to use fee demonstration
recreation fees from the public                  revenues. Local managers are expected to establish spending priorities
under an experimental initiative                 consistent with general program guidance provided by Forest Service
called the Recreational Fee
Demonstration Program. Under
                                                 headquarters. This guidance advises local forest managers to spend fee
the trial program, the Congress                  demonstration revenues on needs that have been identified by forest visitors.
authorized the four federal land
management agencies, including                   On the basis of priorities identified by local users, the Forest Service has
the Forest Service, to charge fees               spent fee demonstration revenues on a wide range of projects at national
to visitors and to retain the                    forests throughout the country. The legislation authorizing the fee
revenues for use in addition to                  demonstration program permitted all the participating agencies to spend fee
other appropriated funds. The                    revenues on certain categories of activities to increase the quality of the
Congress originally authorized the               visitor experience and enhance the protection of resources. GAO reviewed
program for 3 years and has
                                                 the activities of nine demonstration sites in three Forest Service regions to
extended it several times.
                                                 verify that the fee revenues were being spent in accordance with the
As Congress considers whether to                 authorizing legislation for the program and agency spending priorities. GAO
extend the program or to make it                 found no inconsistency.
permanent, the Chairman of the
Subcommittee on Forests and                      The Forest Service does not have a process for measuring the impact of fee
Forest Health asked GAO to                       demonstration expenditures on reducing the deferred maintenance backlog.
address several questions about the              Further, while acknowledging that it has a significant deferred maintenance
Forest Service’s administration of               problem, the agency has not developed a reliable estimate of its deferred
the program: (1) How are spending                maintenance needs.
priorities determined for the
revenues generated by the
                                                 The Forest Service keeps its fee revenue in an account separate from other
program? (2) How has the agency
spent its fee demonstration                      appropriated funds, as required by the authorizing fee program legislation.
program revenues? (3) What, if                   Although the Forest Service tracks its fee revenues and expenditures
anything, is the agency doing to                 separately from other appropriated funds, it does not accurately account for
measure the impact of the                        some fee collection costs.
recreation fee revenues on
reducing the agency’s deferred                   The Forest Service, in commenting on a draft of this report, generally agreed
maintenance backlog? (4) How                     with the report’s contents.
does the agency account for its fee
demonstration program revenues?
                                                 Cleanup of an Illegal Trash Dump in the San Bernardino National Forest Using Recreational
                                                 Fee Demonstration Program Revenues




www.gao.gov/cgi-bin/getrpt?GAO-03-470.

To view the full report, including the scope
and methodology, click on the link above.
For more information, contact Barry T. Hill at
(202) 512-9775 or hillbt@gao.gov.
Contents


                             Results in Brief                                                           2
                             Background                                                                 5
                             Local Forest Service Officials Determine Spending Priorities               6
                             The Forest Service Has Spent Most Revenues on a Wide Range of
                               Activities at the Sites Where the Fees Are Collected                     7
                             The Forest Service Has No Process for Measuring the Impact of Fee
                               Revenues on Deferred Maintenance                                        19
                             The Forest Service Accounts for Its Fee Demonstration Program
                               Revenues and Expenditures Separately from Other Funds but
                               Does Not Accurately Account for Some Fee Collection Costs               24
                             Agency Comments                                                           27


Appendixes
              Appendix I:    Answers to Additional Subcommittee Questions                              29
             Appendix II:    Scope and Methodology                                                     33
             Appendix III:   Comments from the U.S. Department of Agriculture                          36
             Appendix IV:    Comments from the Department of the Interior                              40


Tables                       Table 1: Forest Service Fee Demonstration Expenditures in Fiscal
                                      Year 2001                                                         9
                             Table 2: Revenues and Visitation Data and Reason for Selecting
                                      Demonstration Sites GAO Visited                                  10
                             Table 3: Amount of Forest Service Recreation Programs’
                                      Appropriations and Its Recreational Fee Demonstration
                                      Program Revenues, Fiscal Years 1996-2002                         30
                             Table 4: Comparison of Forest Service Recreation Appropriations’
                                      Allocations to Its Regional Offices to Fee Demonstration
                                      Revenues                                                         31
                             Table 5: Demonstration Sites GAO Visited                                  33


Figures                      Figure 1: Forest Service and National Park Service Fiscal Year 2001
                                       Fee Demonstration Expenditures by Category                       4
                             Figure 2: Enhancement of Boat Launching Area along the
                                       Nantahala River                                                 11
                             Figure 3: Increased Lake Patrols and Maintenance of Floating
                                       Restrooms at Shasta-Trinity National Recreation Area            12
                             Figure 4: Cleanup of an Illegal Trash Dump in San Bernardino
                                       National Forest                                                 14
                             Figure 5: Wastewater Treatment Plant at Multnomah Falls                   15



                             Page i                                             GAO-03-470 Recreation Fees
Contents




Figure 6: Comparison of Forest Service and National Park Service
          Fiscal Year 2001 Fee Demonstration Expenditures                                  19
Figure 7: Before and After Pictures of a Rehabilitated Trail at the
          Nantahala River Gorge                                                            21




 This is a work of the U.S. Government and is not subject to copyright protection in the
 United States. It may be reproduced and distributed in its entirety without further
 permission from GAO. It may contain copyrighted graphics, images or other materials.
 Permission from the copyright holder may be necessary should you wish to reproduce
 copyrighted materials separately from GAO’s product.




Page ii                                                       GAO-03-470 Recreation Fees
A
United States General Accounting Office
Washington, D.C. 20548



                                    April 25, 2003

                                    The Honorable Scott McInnis
                                    Chairman, Subcommittee on Forests
                                     and Forest Health
                                    Committee on Resources
                                    House of Representatives

                                    Dear Mr. Chairman:

                                    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. Under the trial
                                    program, the Congress authorized the four federal land management
                                    agencies—the National Park Service, the Fish and Wildlife Service, and the
                                    Bureau of Land Management, all within the Department of the Interior, and
                                    the Forest Service, within the Department of Agriculture—to charge fees to
                                    visitors and to retain the revenues for use in addition to other appropriated
                                    funds. The Congress originally authorized the program for 3 years and has
                                    extended it four times. The authority to collect these fees currently expires
                                    at the end of fiscal year 2004. The Congress is now considering whether it
                                    should extend the program a fifth time or whether it should make the
                                    program permanent. Central to the debate is how effectively the land
                                    management agencies are using the hundreds of millions of dollars that the
                                    recreation fees have provided them.

                                    The legislation authorizing the Recreational Fee Demonstration Program
                                    encouraged the land management agencies to experiment with new fees
                                    and fee structures for recreational activities and directed them to use the
                                    fee revenues to increase the quality of the visitor experience and to
                                    enhance the protection of natural, historic, and cultural resources. The
                                    agencies were given authority to use fee revenues for a broad array of
                                    activities. The agencies must set aside at least 80 percent of the revenues
                                    collected under the program for the sites that collected the fees. By
                                    allowing the field sites to retain such a large percentage of the fees
                                    collected, the Congress created a powerful incentive for these sites to
                                    generate enough revenues to visibly improve conditions in the areas they
                                    managed. According to the program’s legislative history, the Congress
                                    believed that such local improvements would enhance visitor acceptance
                                    of the new fees.




                                    Page 1                                               GAO-03-470 Recreation Fees
                   As the Recreational Fee Demonstration 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, you asked us to
                   address the following questions about the Forest Service’s administration
                   of the program: (1) How are spending priorities determined for the
                   revenues generated by the Recreational Fee Demonstration Program?
                   (2) How has the agency spent its fee demonstration program revenues?
                   (3) What, if anything, is the Forest Service doing to measure the impact of
                   the recreation fee revenues on reducing the agency’s deferred maintenance
                   backlog? (4) How does the Forest Service account for its fee
                   demonstration program revenues?

                   While our analysis focused on the Forest Service, to provide some
                   perspective, we also obtained some information on how the National Park
                   Service manages its fee demonstration program since it generates, by far,
                   the largest amount of fee revenue. Specifically, where significant
                   differences exist between the two agencies, we provide contrasting
                   information. Together, the Forest Service and the Park Service collect over
                   90 percent of the fees under the Recreational Fee Demonstration Program.
                   In fiscal year 2001, the Forest Service collected $35 million in fees; the Park
                   Service collected $126 million.

                   Further, as our work progressed, you asked us to respond to additional
                   questions about specific aspects of the Recreational Fee Demonstration
                   Program. These questions and our responses to them are included as
                   appendix I of this report. The scope and methodology used in our analysis
                   is included as appendix II.



Results in Brief   Spending priorities for the Recreational Fee Demonstration Program are
                   largely determined by local forest managers who are given broad discretion
                   in deciding how to use fee demonstration revenues. Local managers are
                   expected to establish spending priorities consistent with general program



                   Page 2                                                GAO-03-470 Recreation Fees
guidance provided by Forest Service headquarters. This guidance advises
local forest managers to spend fee demonstration revenues on needs that
have been identified by forest visitors. The guidance also emphasizes a
preference for maintaining existing facilities such as restrooms and visitor
centers and discourages forest managers from initiating new construction
projects. In the Forest Service, local forest managers retain between 90
and 100 percent of the fee demonstration revenue at the sites where fees
are collected. In contrast, local National Park Service managers retain 80
percent of fee revenues at collecting sites, with the remaining 20 percent
going to other sites that have high-priority needs.

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. Based on the most recent Forest Service
data available, in fiscal year 2001, the agency spent 29 percent of its fee
demonstration revenue expenditures on visitor services and operations,
including trash collection, campfire programs, and visitor satisfaction
surveys; 21 percent on maintenance of facilities, such as repairing comfort
stations and fixing roofs; and 17 percent on fee collection. The remaining
33 percent was spent on such activities as enhancing facilities, protecting
resources, and enforcing laws. The legislation authorizing the fee
demonstration program permitted the participating agencies to spend fee
revenues on all of these kinds of on-site activities as long as the
expenditures contributed to enhancing the visitor experience or helped
protect, preserve, or enhance resources. We reviewed the activities of nine
demonstration sites in three different regions to verify that the fee revenues
were actually being spent in accordance with the authorizing legislation for
the program and agency spending priorities. We found no inconsistency.
However, we did find that the Forest Service does not provide consistent
information on where fee revenue is being spent. At each of the sites we
reviewed, officials told us that deciding which category a particular
expenditure falls into is a subjective judgment that is not necessarily
consistent among sites. For example, the repair of an aging restroom
facility could be categorized as either “maintenance,” or a facility
enhancement that could fall into the “other” category. As shown in figure 1,
the National Park Service’s fee demonstration expenditures reflect greater
emphasis on maintenance and fee collection activities compared to the
Forest Service.




Page 3                                                GAO-03-470 Recreation Fees
Figure 1: Forest Service and National Park Service Fiscal Year 2001 Fee
Demonstration Expenditures by Category




The Forest Service does not have a process for measuring the impact of fee
demonstration expenditures on reducing the deferred maintenance
backlog. According to the Forest Service, the agency does not track the
extent to which fee demonstration expenditures have been used for
deferred maintenance for a number of reasons including the temporary
nature of the program and because the agency is not required by the fee
program legislation to measure the impact of fee demonstration revenues
on deferred maintenance. Further, while acknowledging that it has a
significant deferred maintenance problem, the agency has not developed a
reliable estimate of its deferred maintenance needs. In contrast, the
National Park Service has placed a higher priority on addressing its
deferred maintenance needs with revenues from the fee demonstration
program. In fiscal year 2001, the Park Service began to track the extent to
which it has used fee demonstration revenues to address its multi-billion
dollar deferred maintenance backlog. During that year, the Park Service
spent about 35 percent of its fee demonstration revenues on maintenance




Page 4                                                   GAO-03-470 Recreation Fees
             activities. Since the program began, agency officials estimate that about
             70 percent of its fee demonstration expenditures have been for deferred
             maintenance activities ($274 million out of $395 million). However, like the
             Forest Service, the Park Service has not yet developed a reliable estimate
             of its deferred maintenance needs.

             The Forest Service keeps its fee demonstration revenue in two different
             Treasury accounts separate from its other appropriated funds, as required
             by the authorizing fee program legislation. Eighty percent of its fee
             revenues are maintained in an account for expenditure without further
             appropriation at the site where the fees were collected and 20 percent of its
             fee revenues in another account for expenditure on an agencywide basis
             without further appropriation. Although the Forest Service tracks its fee
             revenues and expenditures separately from other appropriated funds, it
             does not accurately account for some fee collection costs. Specifically, the
             Forest Service does not report total revenues and fee collection costs
             related to discounts that vendors receive for selling recreation passes
             directly to the public. The National Park Service has established a similar
             account structure to comply with the Recreational Fee Demonstration
             Program requirements.

             We received comments from the U.S. Department of Agriculture and the
             Department of the Interior on a draft of this report. The U.S. Department of
             Agriculture generally agreed with the report’s contents. Interior did not
             offer overall comments on the report. Both departments provided us with
             clarifying and technical comments that we incorporated into the report as
             appropriate. Comments from the U.S. Department of Agriculture are
             included in appendix III and comments from the Department of the Interior
             are included in appendix IV.



Background   The Forest Service is responsible for managing over 192 million acres of
             public lands in the United States. In carrying out its responsibilities, the
             Forest Service traditionally has been a decentralized organization, in which
             its programs are administered through 9 regional offices, 155 national
             forests, and over 600 ranger districts (each forest has several districts).




             Page 5                                               GAO-03-470 Recreation Fees
                       The Forest Service implemented the Recreational Fee Demonstration
                       Program in fiscal year 1996 with four demonstration sites that generated
                       $43,000 during the year.1 The program has steadily grown over the past
                       5 years and covers 87 sites, in 80 national forests, that generated over
                       $35 million in fiscal year 2001. 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.



Local Forest Service   Spending priorities for the Recreational Fee Demonstration Program are
                       largely determined by local forest managers who are given broad discretion
Officials Determine    in deciding how to use fee demonstration revenues. Forest Service
Spending Priorities    headquarters provide general program guidance that advises local
                       managers to establish spending priorities that focus on two things. First,
                       local managers are to identify what the visitors want because the Forest
                       Service believes that forest users will more likely accept paying fees if they
                       see that their money is spent on improving recreational visitor services in
                       the national forests they visit. Second, existing facilities such as restrooms
                       and visitor centers should be maintained because the agency prefers to use
                       recreation fees 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 through
                       such methods as obtaining comment cards that are received from visitors,
                       using universities to conduct visitor surveys, and using local user groups,
                       associations, and regional boards.2 According to these officials, visitors


                       1
                         The Forest Service refers to fee demonstration sites as projects. Throughout this report,
                       we refer to them as sites. Under the original Recreational Fee Demonstration Program
                       legislation, no fewer than 10 but up to 50 sites per agency were permitted to charge, collect,
                       and establish recreation fees (Pub. L. No. 104-134, tit. III, § 315(1996)). In fiscal year 1997
                       appropriations, Congress increased the number of authorized sites per agency to 100
                       (Pub. L. No. 104-208, tit. III, § 319 (1996)). In fiscal year 2002 appropriations, the Congress
                       eliminated the 100 demonstration sites per agency limitation (Pub. L. No. 107-63, tit. III, §
                       312 (b)(2001)).
                       2
                        Regional boards consist of membership with recreation, forest, law enforcement, fiscal,
                       and economic backgrounds and are used to help oversee the fee demonstration program
                       within each region of the Forest Service.




                       Page 6                                                           GAO-03-470 Recreation Fees
                          desire that spending priorities should address such things as 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 has committed to retaining
                          almost all fee demonstration revenues at the collection sites—between 90
                          and 100 percent of fee revenues collected are to be retained and used at the
                          collection site. In regions 5 and 8 (the Pacific Southwest and Southern
                          regions) that we visited, 95 percent of fee revenues are retained and used at
                          the collecting site and in region 6 (the Pacific Northwest), 92 percent of fee
                          revenues are retained on site. The portion of fee revenues that are not
                          retained on site is used by the regional offices for a variety of program-
                          related activities like providing new demonstration projects with start-up
                          money, providing fee demonstration signs and brochures, regional pass
                          sales, and for marketing activities.

                          In contrast to the Forest Service, the National Park Service permits
                          demonstration sites to retain no more than 80 percent of the fee revenue
                          collected. The Park Service requires that the remaining 20 percent of fee
                          revenues be used for addressing high-priority needs at other lower-revenue
                          fee demonstration sites, at park units that do not participate in the fee
                          demonstration program, or for servicewide priorities, such as funding
                          youth groups to work on national park projects. In terms of program
                          priorities, the Park Service emphasizes that local managers focus on
                          addressing deferred maintenance and critical resources protection needs.



The Forest Service Has    As permitted by the authorizing legislation for the Recreational Fee
                          Demonstration Program, the Forest Service has spent fee revenues on a
Spent Most Revenues       wide range of projects. Our analysis at a sample of sites participating in the
on a Wide Range of        fee demonstration program revealed that fee revenue was being spent for
                          activities that were consistent with the legislation authorizing the program
Activities at the Sites   and the agency’s spending priorities. On the national level, the most
Where the Fees Are        recently available information indicates that about one half of the fee
Collected                 revenues were being spent for visitor services and maintenance activities.
                          However, because the agency relies on subjective determinations by local
                          forest managers to categorize its expenditures, these determinations are
                          not consistent among sites. Accordingly, the accuracy of program-wide
                          information depicting the amounts of fee revenues spent for various
                          categories is questionable. In contrast to the Forest Service, the National



                          Page 7                                                GAO-03-470 Recreation Fees
                              Park Service uses a larger portion of its fee demonstration expenditures on
                              collecting fees and addressing its maintenance needs and less for visitor
                              services.



Forest Service Expenditures   The Congress provided the Forest Service and the other land management
Emphasize Maintaining         agencies broad authority in deciding how to spend fee demonstration
                              revenues. The 1996 authorizing legislation for the program3 directed the
Existing Facilities and       agencies to spend fee revenues to “…increase the quality of the visitor
Providing Visitor Services    experience at public recreational areas and enhance the protection of
                              resources.” This legislation permitted the agencies to spend fee
                              demonstration revenues in the following areas: backlogged repair and
                              maintenance projects (including projects related to health and safety),
                              interpretation, signage, habitat or facility enhancement, resource
                              preservation, annual operation (including fee collection), maintenance, and
                              law enforcement relating to the public use of lands.

                              For fiscal year 2001, the Forest Service reported that it collected about $35
                              million in fees and spent about $29.3 million. As shown in table 1, the
                              Forest Service spent the fee revenues on a wide range of activities, as
                              allowed by the legislation that authorized the program. The Forest Service
                              spent about half of their fee revenues in two categories: visitor services and
                              operations and maintenance.




                              3
                                Omnibus Consolidated Rescissions and Appropriations Act of 1996, Pub. L. No. 104-134, tit.
                              III, § 315(c)(3).




                              Page 8                                                         GAO-03-470 Recreation Fees
Table 1: Forest Service Fee Demonstration Expenditures in Fiscal Year 2001

Dollars in thousands
                                           Types of activities included in expenditure                        Fee demonstration                 Percent of total
Expenditure categorya                      category                                                                expenditures                   expenditures
Visitor Services and                       Routine incidental costs like mowing, trash
Operations                                 collections, and toilet pumping                                                   $8,566                            29
Maintenance                                Repair or replacement of worn assets such as
                                           toilets, roofs, and trails; includes projects related to
                                           health and safety and backlogged maintenanceb                                      6,101                            21
Cost of Collection                         Direct fee collections costs including fee
                                           collections and non-payment enforcement                                            5,051                            17
Interpretation and Signing                 Delivering interpretation and information to visitors
                                           such as interpretive programs and tours                                            3,859                            13
Facility Enhancement                       Enhancement of existing facilities such as new
                                           building, trail, or picnic table construction                                      3,365                            12
Security and Enforcement                   Enforcement of laws and regulations such as
                                           protection of facilities, visitors, and natural and
                                           cultural resources                                                                 1,164                              4
Resource Preservation and                  Resource and habitat restoration, enhancement
Enhancement                                and preservation, such as landscaping and wildlife
                                           fencing                                                                              911                              3
Other                                      Includes interagency transfers and other
                                           miscellaneous expenditures                                                           238                              1
Total                                                                                                                      $29,255                            100
Source: GAO analysis of Forest Service data.
                                                             a
                                                              In fiscal year 2002, the Forest Service combined health and safety expenditures into the maintenance
                                                             category and habitat enhancement expenditures into the resource preservation and enhancement
                                                             category. We used these combined categories for reporting the fiscal year 2001 expenditures.
                                                             b
                                                              Backlogged or deferred maintenance expenditures may also be categorized under categories other
                                                             than maintenance.


                                                             To get some indication whether the Forest Service is spending the fee
                                                             revenues consistent with the authorizing legislation and agency priorities
                                                             and to verify that projects were being completed, we reviewed the
                                                             activities of a sample of demonstration sites in the three Forest Service
                                                             regions that have generated the most fee demonstration revenues. The
                                                             three regions we visited were region 5, the Pacific Southwest, generating
                                                             $5.7 million; region 6, the Pacific Northwest, generating $5.7 million; and
                                                             region 8, the Southern Region, generating $6.1 million in fiscal year 2001.
                                                             Collectively, the three regions represent 58 percent of total fee
                                                             demonstration revenues generated by the Forest Service in fiscal year 2001.
                                                             In each of the three regions, we selected three fee demonstration sites, as
                                                             shown in table 2. Our site selection criteria were the same for each region.



                                                             Page 9                                                                GAO-03-470 Recreation Fees
                                                     Specifically, we selected a site that generated the most fee revenues, a site
                                                     that had the least fee revenues, and of the remaining sites in each region,
                                                     the one that had the least fee revenue per visitor.



Table 2: Revenues and Visitation Data and Reason for Selecting Demonstration Sites GAO Visited

Dollars in thousands
                                                                                            Fiscal year         Fiscal year
                                                                                                  2001                 2001 Reason for
Region/sites visiteda                                           State                         revenues            visitation selection
5—Pacific Southwest
• Shasta-Trinity National Forests (Shasta-Trinity
  National Recreation Area)                                     California                       $1,407                3,550 Highest revenue
• Klamath National Forest                                       California                           37                   21 Lowest revenue
• Enterprise Forest Projectb                                    California                        3,105               15,245 Lowest revenue per
                                                                                                                             visitor
6—Pacific Northwest
• Gifford Pinchot National Forest (Mount St. Helens
  National Volcanic Monument)                                   Washington                        1,285                  635 Highest revenue
• Colville National Forest                                      Washington                           15                    6 Lowest revenue
• Columbia River Gorge National Scenic Area                     Washington                          384                1,982 Lowest revenue per
  (Multnomah Falls)                                             & Oregon                                                     visitor
8—Southern
• North Carolina National Forests                               North Carolina                    1,103                  982 Highest revenue
• Kisatchie National Forest                                     Louisiana                           103                  344 Lowest revenue
• Texas National Forests                                        Texas                               175                2,500 Lowest revenue per
                                                                                                                             visitor
Source: GAO analysis based on Forest Service data.
                                                     a
                                                      We did not make an on-site visit to the Kisatchie National Forest site because the site was closed due
                                                     to a hurricane at the time we were conducting our fieldwork. We did, however, obtain appropriate
                                                     supporting documentation from the site manager.
                                                     b
                                                      The Enterprise Forest project covers four national forests in Southern California. Revenues in each of
                                                     these four forests—Angeles, Cleveland, Los Padres, and San Bernardino Forests—do not exceed the
                                                     revenue generated at Shasta-Trinity National Forests. The Enterprise Forest site generated the lowest
                                                     revenues per visitor. We visited the Angeles and San Bernardino National Forests.


                                                     Based on our review and on-site observations at the selected sites, we
                                                     found that the fee revenues were spent consistent with the legislative
                                                     authority provided for the program and with spending priorities set by the
                                                     agency. The following paragraphs illustrate the types of projects that were
                                                     being funded with fee demonstration revenues at the sites we visited.

Projects at Sites Having                             The three sites having relatively high amounts of fee revenue generally had
Relatively High Amounts of Fee                       popular destination attractions for visitors. At these sites, fee revenues
Revenue


                                                     Page 10                                                                GAO-03-470 Recreation Fees
were spent on projects geared toward enhancing the overall visitor
experience. For example:

• The Nantahala River Gorge, one of the sites in the National Forests of
  North Carolina fee demonstration project, is a world-class whitewater
  river that attracts about 250,000 people annually. In fiscal year 2001, the
  site generated about $208,000 in fee revenues through user fees and
  special use permits for commercial outfitters. During that year, the site
  spent over $292,000 in fee revenues, which included revenues generated
  from prior years. Nantahala Gorge officials spent most of their fee
  revenues to upgrade or enhance facilities for serving visitors. For
  example, they spent about $150,000 by providing handicap accessibility,
  improving visitor safety, and eliminating erosion and sedimentation of
  the Nantahala River by constructing a concrete surface for launching
  boats and rafts on the river. The following figure shows the enhanced
  boat-launching area.



Figure 2: Enhancement of Boat Launching Area along the Nantahala River




Page 11                                               GAO-03-470 Recreation Fees
                                          • The Shasta Trinity National Recreation Area demonstration site, located
                                            in northern California, generated in fiscal year 2001 about $1.1 million
                                            fee revenues through special use permit fees for over 700 privately-
                                            owned house boats and 55 recreation facilities such as resorts, docks,
                                            marinas, and organized camps on Shasta Lake and Trinity Lake. Site
                                            managers spent over $514,000 in fee revenues in fiscal year 2001. Most
                                            of the expenditures were for maintenance, enhancing facilities, and
                                            visitor services. The expenditures included regular cleaning and
                                            maintenance of the floating restrooms, increasing the number of
                                            portable restrooms and dumpsters available for visitors, installing
                                            floating directional signs and underwater obstacle markers for boaters,
                                            providing bear-proof food lockers, increasing the frequency of safety
                                            patrols on the lake, and expanding staffing and hours of operation at the
                                            visitor center. Figure 3 shows some examples of these projects.



Figure 3: Increased Lake Patrols and Maintenance of Floating Restrooms at Shasta-Trinity National Recreation Area




                                          Page 12                                                  GAO-03-470 Recreation Fees
Projects at Sites Having           The three sites that we visited that had relatively low amounts of fee
Relatively Low Amounts of Fee      revenues were generally located away from urban areas.4 These sites had
Revenue                            fewer visitors and fewer visitor needs than the high revenue sites. Their
                                   expenditures focused on maintaining existing facilities and providing basic
                                   visitor services. The following examples illustrate the types of
                                   expenditures at these sites.

                                   • The Klamath National Forest in northern California collects fee
                                     revenues through fees charged at 15 of 36 campgrounds in the forest.
                                     The Klamath National Forest collected over $37,000 in fiscal year 2001,
                                     the first year of the fee program in this forest. They did not report any
                                     expenditures until fiscal year 2002. Their spending was limited in fiscal
                                     year 2002 because they were asked to defer spending on projects and
                                     acquisitions to help ensure that the Forest Service had enough money to
                                     carry out fire suppression activities.5 In fiscal year 2002, the site spent
                                     only $1,740 to replace four decaying picnic tables at a campground.

                                   • The Kisatchie National Forest, in Louisiana, collects fee revenues from
                                     31 recreational sites, including 12 campgrounds and 12 day-use sites.
                                     The Kisatchie National Forest generated over $103,000 and spent about
                                     $58,000 in fee revenue during fiscal year 2001. They spent most of their
                                     fee revenues on fee collections, facility enhancements, and
                                     maintenance, including such things as repairing or replacing water and
                                     sewer lines, reconstructing trails, constructing handicap-accessible
                                     walkways and restrooms, and acquiring fire rings, cooking grills, and
                                     picnic tables to improve campground services.

Projects at Sites Having           The sites that had large numbers of visitors, but relatively small amounts of
Relatively Heavy Visitor Use and   revenue were generally located near major metropolitan areas. As a result,
Low Amount of Revenue              these sites typically spent their fee revenues managing the impacts of
                                   visitors. The following examples illustrate the types of expenditures at
                                   these sites.

                                   • The Angeles and San Bernardino National Forests are two of the four
                                     forests that are part of the Enterprise Forest fee demonstration site that

                                   4
                                    We did not make an on-site visit to the Kisatchie National Forest site because the site was
                                   closed because of 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.
                                   5
                                    See appendix I for a discussion of transferring funds from the Forest Service recreation
                                   programs for supplementing wildfire suppression activities.




                                   Page 13                                                         GAO-03-470 Recreation Fees
    received over 15 million visitors during fiscal year 2001. The Angeles
    and San Bernardino National Forests are both located within a 2-hour
    drive of metropolitan Los Angeles. They generate most of their fee
    revenues through a recreation use fee called the Adventure Pass.6 In
    fiscal year 2001, the Angeles National Forest generated about
    $1.3 million and spent over $737,000, and the San Bernardino National
    Forest generated about $920,000 and spent over $832,000 in
    expenditures. Both the Angeles and San Bernardino National Forests
    spent about 80 percent of its fiscal year 2001 revenue for providing
    visitor services and maintaining operations, maintenance of facilities,
    and for providing interpretative services. At the Angeles National
    Forest, these expenditures included such things as providing more
    public restrooms, including crew expenses to clean and maintain them,
    and for renting portable toilets. At the San Bernardino National Forest,
    fee revenues were spent on new interpretative programs for visitors,
    maintaining trails, and improving forest operations, including removing
    refuse from illegal trash dumps, as shown below.



Figure 4: Cleanup of an Illegal Trash Dump in San Bernardino National Forest




• Multnomah Falls, located within 30 miles of Portland, Oregon, is one of
  the most popular attractions in the Columbia River Gorge National


6
 The Adventure Pass is a vehicle-parking pass that is required to be displayed on vehicles
while occupants are recreating on the four urban national forests in Southern California.




Page 14                                                        GAO-03-470 Recreation Fees
   Scenic Area. This site receives nearly 2 million visitors per year.
   Visitors are not charged a fee at Multnomah Falls. Instead, the site gets
   its fee revenue by retaining a portion of the special use permit fees from
   a private concessionaire that runs the Multnomah Falls Lodge. The
   Lodge is located at the entrance to the falls and serves as a visitor center
   that sells food and souvenirs to visitors. In fiscal year 2001, the
   Columbia River Gorge National Scenic Area generated about $220,800.
   It spent $290,000 from current and prior year fee revenues, of which
   nearly 90 percent was spent on visitor services and operations. More
   than half of these expenditures were for a contract to operate a
   wastewater treatment plant for the Multnomah Falls Lodge, as shown in
   the following figure. Most of the remaining expenditures were spent on
   staffing and operating the visitor center at the lodge.



Figure 5: Wastewater Treatment Plant at Multnomah Falls




Page 15                                                   GAO-03-470 Recreation Fees
Forest Service Information   To promote accountability for using fee demonstration funds, the House
on Fee Demonstration         Committee on Appropriations directed the Forest Service, along with the
                             other federal agencies participating in the fee Demonstration Program, to
Expenditure Is Not
                             jointly prepare an annual report on the Recreational Fee Demonstration
Consistently Reported        Program.7 Among other things, this report provides the Congress with
                             information on the amount of fee demonstration revenues collected and
                             how they are spent. The Forest Service compiles this data from the local
                             fee program managers across the nation. However, we found that the
                             information that the Forest Service provides on categorizing expenditures
                             is not consistently reported. First, the fee program managers do not
                             allocate their expenditures into the spending categories in a systematic
                             manner. Second, the Forest Service fee revenue expenditure reporting
                             categories overlap.

                             The Forest Service reports its fee demonstration expenditures using
                             spending categories largely corresponding to those identified in the
                             legislation authorizing the demonstration program. These categories are
                             visitor services and operations, maintenance, interpretation and signing,
                             facility enhancement, resource preservation and enhancement, security
                             and enforcement, and cost of collection. However, the Forest Service
                             officials stated that their accounting system is not set up to track
                             expenditures into these categories. Local fee program managers, who
                             compile the fee revenue expenditure data, use various methods to record
                             their expenditures. At the sites we visited, we found that local managers
                             relied on a variety of financial information sources such as project work
                             plans and job code summary reports, as well as reviewing bills and
                             receipts, as a basis for allocating their expenditures into the reporting
                             categories. Further, one manager stated that he also interviewed his staff
                             on work performed and the time they devoted to various tasks to estimate
                             the amount of fee revenues spent in each reporting category. Accordingly,
                             in the absence of forest managers having a consistent and systematic
                             method for tracking and recording the expenditure amounts by spending
                             category, the accuracy of the spending information in the agency’s annual
                             report is questionable.




                             7
                                 H. R. Rep. No. 105-163 (1997).




                             Page 16                                            GAO-03-470 Recreation Fees
Another concern affecting the spending information in the agency’s annual
report is the subjectivity of the spending categories themselves. Despite
headquarters guidance that attempts to define the kinds of activities that
should be included in each spending category, officials at seven of the nine
demonstration sites that we visited told us that deciding which reporting
category a particular expenditure falls into involves making a judgment
that is not necessarily consistent among sites.8 For example, when an
aging restroom needs extensive repairs, it may be more cost effective to
build a new facility to replace it. In this situation, the expenditures for
building a new facility can be reported as a “maintenance” expense, or as a
“facility enhancement” expense. In either instance, the expenditure is
consistent with the types of expenditures authorized under the program.
However, deciding under which expenditure category is reported is a
judgment of the site manager. Similarly, expenditures for fee enforcement
activities and fee collections may also be reported inconsistently. For
example, we found that some sites we visited reported fee enforcement
activities as part of their “cost of collections.” However, other sites
reported fee enforcement activities as part of their expenditures for
“security and enforcement.” These inconsistencies further affect the
consistency of the Forest Service’s reporting of where fee revenues are
actually spent.

According to Forest Service program officials, the agency is reluctant to
invest in a new system that would more accurately categorize expenditures
because further categorization of expenditures is not required by
legislation, nor have the agencies participating in the fee demonstration
program been asked by the Congress to do so.

In commenting on a draft of this report, the Forest Service noted that it
chose to create seven expenditure categories to track those identified in
the legislation as a means of reporting accomplishments to the Congress.
To help ensure that fee demonstration expenditures are consistently
reported, the Forest Service also said that it will re-examine its reporting
procedures and consider using broader categories that are used by the
Department of the Interior agencies.




8
    The other two demonstration sites did not have any expenditures during fiscal year 2001.




Page 17                                                          GAO-03-470 Recreation Fees
National Park Service Fee   Compared to the Forest Service, the National Park Service spent relatively
Expenditures Emphasize      more of its fee demonstration expenditures on maintenance and fee
                            collection activities.9 In fiscal year 2001, the Forest Service spent about
Maintenance and Fee
                            $29 million and the National Park Service spent about $116 million of its fee
Collection                  demonstration revenues.10 The National Park Service spent about
                            35 percent of its fiscal year 2001 fee demonstration expenditures on
                            maintenance activities. In contrast, the Forest Service spent about
                            21 percent of its expenditures in this area. The Park Service spent about
                            26 percent of its fee expenditures on fee collection activities compared to
                            about 17 percent in the Forest Service. About 10 percent of the Park
                            Service’s fee demonstration expenditures were used on visitor services,
                            such as interpretation exhibits and services, compared to 29 percent for the
                            Forest Service. The Park Service spent the remaining 28 percent on such
                            other activities as protecting natural and cultural resources compared to
                            33 percent for the Forest Service.

                            The following figure graphically portrays the spending emphasis of the two
                            agencies.




                            9
                             In making this comparison, we combined several of the reporting categories for these two
                            agencies in order to report similar categories. As a result, the percentage shown in the
                            “Other” category appears large. Also, we refer to the Park Service’s “health and safety
                            maintenance” expenditures as “maintenance.”
                            10
                               Total fiscal year 2001 fee demonstration revenues for the Forest Service and Park Service
                            were about $35 million and about $126 million (excluding $14 million in National Park
                            Passport revenue), respectively.




                            Page 18                                                        GAO-03-470 Recreation Fees
Figure 6: Comparison of Forest Service and National Park Service Fiscal Year 2001 Fee Demonstration Expenditures




                                         Note: The percentages for the National Park Service do not add up to 100 due to rounding.


                                         In commenting on a draft of this report, the Forest Service noted that
                                         compared to the National Park Service, the Forest Service expends more
                                         fee demonstration expenditures on visitor services and less on
                                         maintenance because unlike the Park Service, many Forest Service sites
                                         with high visitation near metropolitan areas lack the infrastructure that
                                         might require deferred maintenance. Additionally, the Forest Service noted
                                         that its expenditures reflect the agency’s guidance to local forest managers
                                         to spend fee demonstration revenues on needs that have been identified by
                                         forest visitors.



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



                                         Page 19                                                             GAO-03-470 Recreation Fees
                             know if its total deferred maintenance needs are being reduced. While the
                             Park Service also does not have a reliable estimate of its deferred
                             maintenance needs, it has placed a higher priority on addressing this
                             problem and has begun to track the amount of fee revenues that are being
                             used for deferred maintenance.



The Forest Service Does      The legislation authorizing the Recreational Fee Demonstration Program
Not Track Fee Expenditures   permits the Forest Service and the other participating agencies to spend fee
                             revenues on deferred maintenance needs. In fact, at each of the locations
That Address Deferred
                             we visited, the site managers told us that they were using a portion of fee
Maintenance Needs            revenues to do a variety of projects that addressed deferred maintenance
                             needs. Those projects included such things as replacing worn and rotted
                             picnic tables at a campground in Klamath National Forest in California,
                             fixing eroded and deteriorated hiking trails in the Nantahala Gorge in the
                             North Carolina National Forest, and replacing deteriorating restrooms in
                             Kisatchie National Forest in Louisiana. Figure 7 shows before and after
                             pictures of a rehabilitated trail at the Nantahala River Gorge.




                             Page 20                                             GAO-03-470 Recreation Fees
Figure 7: Before and After Pictures of a Rehabilitated Trail at the Nantahala River
Gorge




However, even though the Forest Service is spending a portion of its fee
revenues in this area, the agency does not specifically track how much it
spent on deferred maintenance. So, expenditures like the trail
maintenance at Nantahala Gorge are reported as a “resource preservation
and enhancement expenditure.” Because the Forest Service uses this
approach, the amount of agency expenditures for deferred maintenance
cannot be determined nor can the agency determine whether the backlog
of deferred maintenance needs is being reduced.




Page 21                                                    GAO-03-470 Recreation Fees
                           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 invest its fee demonstration revenues for developing
                           and implementing a system for tracking deferred maintenance spending.
                           Second, the fee demonstration program is temporary and it is unclear at
                           this time whether the Congress will make the program permanent. As a
                           result, agency officials said that this uncertainty makes them question the
                           wisdom of developing an additional process for tracking deferred
                           maintenance. Finally, the agency was not required by the fee program
                           legislation to measure the impact of fee revenues on deferred maintenance.
                           They have chosen not to do so.



The Forest Service Has a   Forest Service officials acknowledge that the agency has a significant
Significant Deferred       deferred maintenance problem. In fiscal year 2001, the agency estimated
                           that its total deferred maintenance backlog was in the billions of dollars,
Maintenance Problem        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. Further, the Inspector
                           General pointed out that the agency had no system or systematic way to
                           compile the information needed to provide managers or Congress with
                           reliable estimates.11 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. Accordingly, even if the Forest Service collected




                           11
                             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 22                                                       GAO-03-470 Recreation Fees
                               specific information on the amount of fee revenue being used to address
                               deferred maintenance needs, the agency would not know if its total
                               deferred maintenance needs are being reduced.



The National Park Service      Since the fee demonstration program began, the Congress and the current
Has Placed a Higher Priority   administration have encouraged the National Park Service to place a
                               priority on spending fee demonstration revenues to help reduce its
on Addressing Deferred         multi-billion dollar deferred maintenance backlog. Our review of the Park
Maintenance Needs              Service’s guidance to on-site park managers showed that the agency has
                               emphasized that fee demonstration revenues should be spent on deferred
                               maintenance projects. In fiscal year 2001, the Park Service began to track
                               the amount of fee revenues used for addressing deferred maintenance
                               needs. During that year, the Park Service spent about 35 percent of its fee
                               demonstration expenditures on maintenance activities. Since the program
                               began, agency officials estimate that about 70 percent of its fee
                               demonstration expenditures have been for deferred maintenance activities
                               ($274 million out of $395 million).12,13

                               However, while the agency is now tracking its deferred maintenance
                               expenditures, like the Forest Service, the Park Service has not yet
                               developed a reliable estimate of its total deferred maintenance backlog. As
                               reported by us, the Department of Interior’s Inspector General, and
                               others,14 the Park Service has had longstanding difficulties in developing an
                               accurate and reliable estimate of the amount of deferred maintenance on
                               its assets. In 2002, we reviewed the status of the Park Service’s efforts to
                               develop better deferred maintenance data.15 At that time, the agency was
                               just beginning to implement a new asset management process that should,

                               12
                                  Recreational Fee Demonstration Program: Interim Report to Congress submitted by the
                               U.S. Department of the Interior and the U.S. Department of Agriculture; April 2002.
                               13
                                  It should be noted that deferred maintenance expenditures include projects such as
                               resource preservation and visitor services.
                               14
                                  U.S. General Accounting Office, National Park Service: Efforts to Identify and Manage
                               the Maintenance Backlog, GAO/RCED-98-143 (Washington, D.C.: May 14, 1998). U.S.
                               Department of the Interior, Office of Inspector General, Followup of Maintenance
                               Activities, National Park Service, 98-I-344 (Washington, D.C.: Mar. 1998). U.S. Department
                               of the Interior, Interior Planning, Design and Construction Council, Facilities Maintenance
                               Assessment and Recommendations (Washington, D.C.: Feb. 1998).
                               15
                                  U.S. General Accounting Office, National Park Service: Status of Efforts to Develop
                               Better Deferred Maintenance Data, GAO-02-568R (Washington, D.C.: Apr. 12, 2002).




                               Page 23                                                        GAO-03-470 Recreation Fees
                              when fully and properly implemented, provide a systematic and reliable
                              methodology for estimating the amount of deferred maintenance needs
                              throughout the national park system.



The Forest Service            The federal agencies participating in the Recreational Fee Demonstration
                              Program are required by the authorizing legislation to maintain fee
Accounts for Its Fee          revenues in separate Treasury accounts and to account for fee
Demonstration                 expenditures separately from other appropriated funds. Consistent with
                              this requirement, the Forest Service accounts for its fee revenues and
Program Revenues and          expenditures separately from other appropriated funds, even when using
Expenditures                  fee demonstration revenues along with other appropriated funds. The
Separately from Other         National Park Service also tracks its fee demonstration funds apart from its
                              other appropriated funds as required by law. Although the Forest Service
Funds but Does Not            generally tracks its fee revenues and expenditures separately from other
Accurately Account for        appropriated funds, it does not accurately account for some fee collection
Some Fee Collection           costs.

Costs

The Forest Service            The authorizing legislation for the fee demonstration program requires the
Separately Accounts for Its   participating federal agencies to maintain fee revenues in separate
                              Treasury accounts and to account for fee expenditures separately from
Fee Demonstration
                              other appropriated fund expenditures. The Forest Service is required to
Revenues and Expenditures     maintain its fee revenues in two separate Treasury accounts—80 percent of
                              its fee revenues are maintained in an account for expenditure without
                              further appropriation at the site where the fees were collected and
                              20 percent of its fee revenues in another account for expenditure on an
                              agencywide basis without further appropriation. The Forest Service
                              appropriately maintains its fee revenues in separate Treasury accounts and
                              tracks expenditures separately from other appropriated funds. The Forest
                              Service officials generally follow the same recording and spending
                              procedures for its fee demonstration funds that they use for other
                              appropriated funds. In particular, agency officials ensure they have proper
                              authority before spending the fee revenues and that they do not spend over
                              the amount of resources available.16


                              16
                                 The Anti-Deficiency Act prohibits expenditures and obligations that exceed the amounts
                              available in the related appropriation or fund accounts.




                              Page 24                                                       GAO-03-470 Recreation Fees
                            While the Forest Service accounts for fee revenue and expenditures
                            separate from other appropriated funds, it can and does use fee revenues
                            along with other appropriated funds to complete projects. For example,
                            officials at the Gifford Pinchot National Forest used a combination of fee
                            demonstration revenues and other appropriated funds to replace a bridge
                            on the Pacific Crest National Scenic Trail in 2001. For this project, agency
                            officials separately accounted for revenues and expenditures from the fee
                            demonstration program from the other appropriated funding sources.

                            The National Park Service, like the Forest Service, also accounts for fee
                            demonstration funds separately from its other appropriated funds. Park
                            Service officials stated that the funds in the fee demonstration program
                            accounts are also deposited with the U.S. Treasury and are separately
                            accounted for when used with other appropriated funds to complete
                            projects.



Forest Service Does Not     In the Pacific Southwest and the Pacific Northwest regions, the Forest
Accurately Account for      Service uses vendors to help sell some forest passes directly to the public.
                            The Forest Service uses vendors in order to increase convenience for the
Some Fee Collection Costs   visiting public and to save agency administration costs. As payment for a
                            vendor’s services, the Forest Service allows the vendor to retain a certain
                            percentage of the value of the pass, which the Forest Service refers to as a
                            discount.17 These vendor discounts are one part of the total fee collection
                            costs for the Forest Service. The Forest Service may use up to 15 percent
                            of the current year fee collections to cover fee collection costs in that fiscal
                            year.

                            Forest Service officials in the Pacific Southwest and Pacific Northwest
                            regions did not record the vendor discount and did not count vendor
                            discounts as part of their fee collection costs. Although the Forest Services
                            accounting system should capture all revenues and expenses, program
                            officials were not aware at the time the system was developed that vendor
                            discounts should have been captured. Forest officials at the locations
                            where this was occurring could not tell us the total amount of vendor
                            discounts that the agency has permitted. Excluding vendor discounts from
                            the cost of collection is also inconsistent with federal financial accounting



                            17
                               These discounts are incentives or commissions to vendors for handling and selling the
                            passes.




                            Page 25                                                        GAO-03-470 Recreation Fees
standards and the U.S. Department of Agriculture financial manual.18
These standards require that total revenues and expenses be reported.

The Forest Service practice of allowing vendor discounts results in
inaccurate fee revenue and expenditure reporting. Because the vendor
retains the discount rather than the Forest Service first collecting all fee
revenues and then paying the vendor out of these revenues, the amount of
fee revenues that the forest receives is reduced. In addition, the vendor
discounts are not included as part of fee collection costs. Thus, both fee
revenues and fee collection costs are underreported. Because of
inaccurate reporting of fee revenues and collection costs, the Forest
Service has no assurance that it is in compliance with the recreational fee
demonstration legislation requirement only allowing 15 percent of fee
revenues to be used for fee collection costs.

For example, at the San Bernardino and Angeles National Forests, private
vendors receive a handling fee of $1.00 for every $5.00 daily pass sold. For
illustration purposes, consider the following scenario. If these two forests
sell 1,000 daily $5 passes in 1 year they should have $5,000 in reported fee
revenues. If they pay the vendor $1 for each $5 pass, they should have fee
collection costs associated with the vendor’s services of $1,000. In
contrast, the Forest Service’s practice of not reporting vendor discounts
would result in only $4,000 in reported fee revenues and no reported fee
collection costs associated with the vendor’s services. For the two forests
in our example, both of which are in the Enterprise Forest project, nearly
20 percent of fee revenues were used to cover fee collection costs in fiscal
year 2001. If this occurs at multiple recreation sites, there is a risk that the
Forest Service would exceed the statutory limitation that not more than
15 percent of total revenues be used for fee collection costs. The practice
of not reporting vendor discounts as part of fee collection costs makes it
difficult to determine compliance with the statutory limitation.

The Forest Service agrees that vendor discount expenses are not fully
disclosed and as a result collections are understated. According to the
Forest Service, however, its use of vendors is limited and thus represents a
relatively small portion of expenditures.


18
  Statement of Federal Financial Accounting Standards No. 4 (Managerial Cost Accounting
Concepts and Standards for the Federal Government) and No. 7 (Accounting for Revenue
and Other Financing Sources) and the USDA Financial and Accounting Standards Manual,
March 17, 2000; section 12.51.1.9.




Page 26                                                     GAO-03-470 Recreation Fees
                  In commenting on a draft of this report, the Forest Service stated that it is
                  preparing accounting instructions for the field, and it plans to implement a
                  new procedure in the immediate future to record the revenue deposited
                  into the U.S. Treasury and use an accounting mechanism that would
                  indicate the foregone revenue and “cost of collection” associated with the
                  discount.



Agency Comments   We provided the U.S. Department of Agriculture and the Department of the
                  Interior copies of a draft of this report. The U.S. Department of Agriculture
                  generally agreed with the contents in the report. Interior did not offer
                  overall comments on the report. Both departments provided us with
                  clarifying and technical comments that we incorporated into the report as
                  appropriate. Comments from the U.S. Department of Agriculture are
                  included in appendix III and comments from the Department of the Interior
                  are included in appendix IV.


                  As arranged with your office, unless you publicly announce its contents
                  earlier, we plan no further distribution of this report until 30 days after the
                  date of this letter. At that time, we will send copies to the Secretary of
                  Agriculture; the Secretary of the Interior; the Chief of the Forest Service;
                  Director, National Park Service; the Director, Office of Management and
                  Budget; and other interested parties. We will make copies available to
                  others upon request. This report will also be available on GAO’s home page
                  at http://www.gao.gov.




                  Page 27                                               GAO-03-470 Recreation Fees
If you or your staff have any questions about this report, please contact me
at (202) 512-3841. Key contributors to this report were Cliff Fowler, Frank
Kovalak, Patricia Rennie, Jason Venner, Amy Webbink, and Arvin Wu.

Sincerely yours,




Barry T. Hill
Director, Natural Resources
 and Environment




Page 28                                             GAO-03-470 Recreation Fees
Appendix I

Answers to Additional Subcommittee                                                         Appendx
                                                                                                 ies




Questions                                                                                   Appendx
                                                                                                  Ii




              Subsequent to completing our fieldwork during this review, the
              Subcommittee on Forests and Forest Health asked us additional questions
              about specific aspects of the Recreational Fee Demonstration Program. To
              address these additional questions, we requested the Forest Service fee
              demonstration program manager to respond to the specific questions and
              to provide relevant supporting documentation. We reviewed the supporting
              documentation to determine if it was consistent with our knowledge of the
              program and it supported agency statements made in response to the
              issues being questioned. A summary of the Forest Service’s responses
              follows.


              Question 1: Since the implementation of the Recreational Fee
              Demonstration Program in fiscal year 1996, how much money was
              transferred from the Forest Service recreation program, including
              the fee demonstration program, to fund wildfire suppression and
              emergency rehabilitation activities?

              Since fiscal year 1996, the Forest Service has transferred $38 million from
              its recreation program to fund wildfire suppression and emergency
              rehabilitation activities. All of the recreation program funds transferred
              occurred in fiscal year 2002. In that year, the agency transferred over
              $900 million from a variety of Forest Service appropriation accounts. The
              $38 million dollars transferred from the recreation program was a portion
              of the total amount transferred. More specifically, the agency transferred
              $24 million from its recreation appropriation and $14 million from the
              Recreational Fee Demonstration Program. The $24 million came from two
              recreation accounts--$9 million from an account called Recreation,
              Heritage, and Wilderness Resources, and $15 million from an account for
              capital improvements and maintenance for trials. The remaining
              $14 million that was transferred from the fee demonstration program came
              from an unobligated balance of about $34 million that existed at the end of
              fiscal year 2002. According to the fee demonstration program manager, the
              fee revenues were the last tier of funds to be transferred for 2002 fire
              suppression activities. All funds transferred from the fee demonstration
              program were replenished when the Congress enacted the fiscal year 2003
              appropriations for the Forest Service.


              Question 2(a): Have congressional appropriations for the Forest
              Service recreation programs been reduced since the
              implementation of the Recreational Fee Demonstration Program?


              Page 29                                             GAO-03-470 Recreation Fees
                                               Appendix I
                                               Answers to Additional Subcommittee
                                               Questions




                                               Congressional appropriations for the Forest Service recreation programs
                                               have not declined since the start of the Recreational Fee Demonstration
                                               Program in 1996. The following table shows the general increase in
                                               recreation appropriations and fee demonstration program revenues since
                                               1996.



Table 3: Amount of Forest Service Recreation Programs’ Appropriations and Its Recreational Fee Demonstration Program
Revenues, Fiscal Years 1996-2002

Dollars in millions
                                                                                              Fiscal Year
                                                         1996          1997           1998           1999           2000           2001           2002
                                      a
Recreation appropriations                                $267          $281           $277           $293           $301           $363           $390
Fee demonstration revenues                                  0b             9             21             27             32             35                38
Source: GAO analysis of Forest Service data.
                                               a
                                                Includes appropriations for the Forest Service trails and facilities maintenance, reconstruction, and
                                               capital improvements; recreation, heritage, and wilderness program. Excludes recreation fee
                                               collections and fee demonstration revenue.
                                               b
                                               The Forest Service implemented the Recreational Fee Demonstration Program in fiscal year 1996
                                               with four demonstration sites that generated $43,000 during the year.




                                               Question 2(b): Has the agency itself reduced the operating budgets
                                               of recreation programs since the implementation of the fee
                                               demonstration program?

                                               The implementation of the Recreational Fee Demonstration Program does
                                               not appear to be a factor in deciding the amount of recreation program
                                               funds that the Forest Service allocates to its regional offices. In order to
                                               determine whether the Forest Service offset recreation appropriations with
                                               fee demonstration revenues, we reviewed whether the recreation
                                               appropriation allocations to its regional offices decreased as fee
                                               demonstration revenues increased. We reviewed the regional allocations
                                               for each year since the fee demonstration program began. As shown in the
                                               following table, regional allocations have generally increased since the fee
                                               program began. As a result, it appears that the fee demonstration revenues
                                               were used to supplement rather than supplant recreation program funds.




                                               Page 30                                                                 GAO-03-470 Recreation Fees
                                                            Appendix I
                                                            Answers to Additional Subcommittee
                                                            Questions




Table 4: Comparison of Forest Service Recreation Appropriations’ Allocations to Its Regional Offices to Fee Demonstration
Revenues

Dollars in millions
                                                                                                 Fiscal year
                                                     1996               1997             1998             1999           2000              2001             2002
Region 1 (Northern
Rockies)                                              $22                $21              $21               $23            $25              $27               $30
Region 2 (Rocky Mountain)                             27                   29               28                 29           27                35               36
Region 3 (Southwest)                                  23                   26               24                 28           26                31               34
Region 4 (Intermountain)                              27                   31               32                 35           32                40               41
Region 5 (Pacific
Southwest)                                            40                   40               42                 43           45                52               57
Region 6 (Pacific
Northwest)                                            40                   38               38                 37           39                44               46
Region 8 (Southern)                                   32                   31               31                 34           33                41               46
Region 9 (Eastern)                                    28                   26               27                 26           27                31               36
Region 10 (Alaska)                                    13                   17               16                 18           16                20               22
Total regional allocationa                           $252               $259             $258             $273           $271              $321             $347
Otherb                                                16                   22               19                 20           30                42               42
Total a recreation
appropriationsc                                      $267               $281             $277             $293           $301              $363             $390
Fee demonstration
                                                        d
revenues                                                                   $9             $21               $27            $32              $35               $38
Source: GAO analysis based on Forest Service data.
                                                            a
                                                                Some totals do not add correctly due to rounding.
                                                            b
                                                             Other includes funds for headquarters administration and program operations, research stations, and
                                                            program reserves that have not been allocated to each region.
                                                            c
                                                             Total recreation funds exclude fee demonstration revenues and fee collections. Fee collections were
                                                            deleted because the regions directly request appropriation budget authority based on 15 percent of fee
                                                            collections. Thus, the headquarters do not allocate fee collections to its regional offices.
                                                            d
                                                                The fee demonstrated program generated $43,000 in fiscal year 1996 when the program began.




                                                            Question 3(a): What is the amount of appropriated dollars the
                                                            Forest Service spent in fiscal year 2001 for administrative overhead
                                                            to manage and operate the Recreational Fee Demonstration
                                                            Program?

                                                            The Forest Service accounting system does not specifically track
                                                            administrative overhead costs for the Recreational Fee Demonstration



                                                            Page 31                                                               GAO-03-470 Recreation Fees
Appendix I
Answers to Additional Subcommittee
Questions




Program or any other individual program within the agency. Forest Service
officials estimate that in 2001 the agency spent about $10 million of
appropriated funds to support the fee demonstration program. The agency
estimates that $1 million is specifically for fee collection activities and
about $9 million is for support costs for the program such as the salary and
benefits for staff involved in general management, program planning,
legislative and public communications, business services, as well as
common service costs such as rents and utilities, and certain personnel
costs like worker’s compensation and unemployment insurance.


Question 3(b): What is the amount of recreation fee demonstration
dollars that the Forest Service spent in fiscal year 2001 for
administrative overhead to manage and operate the Recreational
Fee Demonstration Program?

As noted in the answer to 3(a), the Forest Service accounting system does
not track administrative overhead costs for the Recreational Fee
Demonstration Program or any other individual program within the agency.
As a result the agency cannot determine these costs. Fee program
expenses that could be considered administrative overhead are comprised
of the cost of collecting fees and expenditures for routine program
operations provided at the fee demonstration sites—such as on-site
management support, site operation and maintenance planning activities,
and conducting on-site visitor surveys. In fiscal year 2001, the Forest
Service spent approximately $5.1 million in fee revenues for fee collection.
In addition, the national fee program manager estimates that a small
percentage of the $8.6 million spent for fee program operations in fiscal
year 2001 could also be considered administrative overhead.


Question 3(c): How does the Forest Service account for
Recreational Fee Demonstration Program expenses such as
periodic agencywide meetings on the fee demonstration program?

The Forest Service pays for its annual national meeting of fee
demonstration program managers and staff using other recreation
appropriated funds although agency officials told us that some attendees
may use fee demonstration program funds if it is part of their training
program. According to the fee demonstration program manager, this
practice allows more fee demonstration funds to be used for on-the-ground
demonstration site activities.


Page 32                                             GAO-03-470 Recreation Fees
Appendix II

Scope and Methodology                                                                                                Appendx
                                                                                                                           iI




              To address each of the objectives, we reviewed the relevant Forest Service
              policies and procedures at the agency’s headquarters, three regional
              offices, and nine demonstration sites. We selected three Forest Service
              regions to contact because they represented: (1) the three largest fee
              demonstration program revenue generating regions during fiscal year 2001;
              (2) geographical diversity; and (3) diversity in the types of recreational use
              (concentrated use in smaller areas versus more dispersed use in large
              areas.) At each of these regions, we selected and obtained information on
              how fee demonstration projects were prioritized, and how the revenues
              were used and accounted for at selected demonstration sites. Within each
              region, we selected the sites that generated the largest fee demonstration
              revenues in fiscal year 2001, the lowest fee revenues, and of the remaining
              sites in each region, the one that had the least fee revenue per visitor. We
              selected this methodology to determine whether capital development
              projects were being funded at the high-revenue sites while some basic
              health or safety or other high-priority needs were not being addressed at
              other sites because of the lack of fee demonstration revenues. Table 5
              identifies the demonstration sites that we visited.



              Table 5: Demonstration Sites GAO Visited

              Region/sites visiteda                                      State
              5—Pacific Southwest
              • Enterprise Forest Projectb                               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.
              a
               We did not make an on-site visit to the Kisatchie National Forest site because the site was closed
              because of 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.
              b
              The Enterprise Forest project covers four national forests in Southern California. These include the
              Angeles, Cleveland, Los Padres, and San Bernardino Forests. We visited the Angeles and San
              Bernadino National Forests.




              Page 33                                                                 GAO-03-470 Recreation Fees
Appendix II
Scope and Methodology




In additon to collecting and reviewing this general information, we
addressed each of the four objectives as follows. To determine how
spending priorities are determined for the revenues generated by the
Recreational Fee Demonstration Program, we interviewed Forest Service
fee demonstration program officials at headquarters, the three regional
offices, and the nine sampled sites; reviewed the applicable program
guidance; and reviewed on-site records at each of the nine sites we visited
to determine how spending priorities were actually being set.

To determine how the Forest Service spent its fee demonstration program
revenues, we obtained information on total fee demonstration
expenditures for fiscal year 2001 and program expenditures for the nine
demonstration sites we visited in the three regions selected. We also
obtained information on the types of projects being funded and the amount
of expenditures for each site. In addition, we determined whether the
types of expenditures made by each of the fee demonstration sites we
visited were made in accordance with the legislative authority provided for
the program and with the agency’s program priorities.

To determine what, if anything, the Forest Service is doing to measure the
impact of recreation fee revenues on reducing the agency’s deferred
maintenance backlog, we interviewed local site managers to determine the
types of projects being funded and the extent of fee revenues spent to
address the deferred maintenance backlog. We also obtained information
on whether the Forest Service has a reliable estimate of its deferred
maintenance needs and identified whether the agency has a process to
measure the impact of fee demonstration revenues on deferred
maintenance. We obtained this information from interviews with
headquarters and on-site program officials and a review of Forest Service
and other agency reports on the deferred maintenance issues within the
agency.

To determine how the Forest Service accounts for its fee demonstration
program revenues and expenditures, we interviewed the headquarters fee
demonstration program manager and site managers on how the agency
accounts for fee demonstration revenues and expenditures compared to
other appropriated funds and how it accounts for its fee collection costs.

While our analysis focused on the Forest Service, we also collected some
information on how the National Park Service was handling its activities in
each of the four areas covered by the objectives. We selected the Park
Service to provide perspective and comparative information to that of the



Page 34                                             GAO-03-470 Recreation Fees
Appendix II
Scope and Methodology




Forest Service because these two agencies generate most of the fee
revenues under the Recreational Fee Demonstration Program. We limited
our work at the Park Service to obtaining and reviewing the relevant
documentation for each of the four objectives and interviewing appropriate
agency officials to get a complete understanding of the documents. We did
not conduct any on-site visits to verify the practices being followed by local
park managers. Because our analysis focused on the Forest Service,
specifically on a detailed review of nine Forest Service fee demonstration
sites, the information reported should not be generalized in making any
conclusions with respect to the National Park Service.

Finally, to address the three additional questions about specific aspects of
the recreational fee demonstration program (see app. I), we requested the
Forest Service fee demonstration program manager at headquarters to
response to the specific questions and to provide supporting
documentation. We reviewed this documentation and asked appropriate
follow-up questions, as necessary, to make sure the information was
consistent with our understanding of the program.

We conducted our work from August 2002 through January 2003 in
accordance with generally accepted government auditing standards.




Page 35                                               GAO-03-470 Recreation Fees
Appendix III

Comments from the U.S. Department of
Agriculture                                                 Appendx
                                                                  Ii




Note: GAO comments
supplementing those in
the report text appear
at the end of this
appendix.




                         Page 36   GAO-03-470 Recreation Fees
                       Appendix III
                       Comments from the U.S. Department of
                       Agriculture




See comment 1.
Now on p. 10.
Now on p. 16.


Now on pp. 16-17.



Now on p. 17.



Now on p. 13.
See comment 2.



Now on pp. 19 and 8.



Now on p. 22.
See comment 3.

Now on pp. 25-26.
See comment 4.




                       Page 37                                GAO-03-470 Recreation Fees
                Appendix III
                Comments from the U.S. Department of
                Agriculture




Now on p. 26.




                Page 38                                GAO-03-470 Recreation Fees
                 Appendix III
                 Comments from the U.S. Department of
                 Agriculture




                 The following are GAO’s comments on the U.S. Department of Agriculture’s
                 letter dated April 9, 2003.



GAO’s Comments   1. We agree and acknowledged their comments on page 17 of the report.

                 2. We agree and acknowledged their comments on page 19 of the report.

                 3. We agree and revised the sentence on page 22 of the report.

                 4. We agree and acknowledged their comments on page 27 of the report.




                 Page 39                                           GAO-03-470 Recreation Fees
Appendix IV

Comments from the Department of the
Interior                                                    Appendx
                                                                  IV
                                                                   i




Note: GAO comments
supplementing those in
the report text appear
at the end of this
appendix.




                         Page 40   GAO-03-470 Recreation Fees
                  Appendix IV
                  Comments from the Department of the
                  Interior




See comment 1.




Now on p. 3.
Now on p. 18.
Now on p. 23.

See comment 2.



Now on pp. 7-8.
See comment 3.




See comment 4.




                  Page 41                               GAO-03-470 Recreation Fees
                 Appendix IV
                 Comments from the Department of the
                 Interior




                 The following are GAO’s comments on the Department of the Interior’s
                 letter dated April 11, 2003.



GAO’s Comments   1. The National Park Service expressed the concern that we used
                    “maintenance” as one of the expenditure categories rather than “health
                    and safety maintenance” and by doing so the expenditure category is
                    misinterpretated to represent deferred maintenance. We did not
                    change the report to “health and safety maintenance” as requested by
                    the Park Service. In table 1 of our report, we describe that the
                    maintenance expenditure category includes projects related to health
                    and safety and backlogged maintenance and we note that backlogged
                    or deferred maintenance expenditures may also be categorized under
                    categories other than maintenance. We added a note stating that we
                    refer to the Park Service’s “health and safety maintenance”
                    expenditures as “maintenance.”

                 2. We revised the report to say that local managers focus on addressing
                    deferred maintenance and critical resource protection needs.

                 3. We changed the language to say that the National Park Service uses a
                    larger portion of fee demonstration “expenditures” rather than
                    “revenues” on collecting fees and addressing its maintenance needs and
                    less for visitor services.

                 4. We added the following statement in the scope and methodology.
                    Because our analysis focused on the Forest Service, specifically on a
                    detailed review of nine Forest Service fee demonstration sites, the
                    information reported should not be generalized in making any
                    conclusions with respect to the National Park Service.




(360247)         Page 42                                            GAO-03-470 Recreation Fees
GAO’s Mission            The General Accounting Office, the audit, evaluation and investigative arm of
                         Congress, exists to support Congress in meeting its constitutional responsibilities
                         and to help improve the performance and accountability of the federal government
                         for the American people. GAO examines the use of public funds; evaluates federal
                         programs and policies; and provides analyses, recommendations, and other
                         assistance to help Congress make informed oversight, policy, and funding
                         decisions. GAO’s commitment to good government is reflected in its core values of
                         accountability, integrity, and reliability.


Obtaining Copies of      The fastest and easiest way to obtain copies of GAO documents at no cost is
                         through the Internet. GAO’s Web site (www.gao.gov) contains abstracts and full-
GAO Reports and          text files of current reports and testimony and an expanding archive of older
                         products. The Web site features a search engine to help you locate documents
Testimony                using key words and phrases. You can print these documents in their entirety,
                         including charts and other graphics.
                         Each day, GAO issues a list of newly released reports, testimony, and
                         correspondence. GAO posts this list, known as “Today’s Reports,” on its Web site
                         daily. The list contains links to the full-text document files. To have GAO e-mail this
                         list to you every afternoon, go to www.gao.gov and select “Subscribe to GAO
                         Mailing Lists” under “Order GAO Products” heading.


Order by Mail or Phone   The first copy of each printed report is free. Additional copies are $2 each. A check
                         or money order should be made out to the Superintendent of Documents. GAO
                         also accepts VISA and Mastercard. Orders for 100 or more copies mailed to a single
                         address are discounted 25 percent. Orders should be sent to:
                         U.S. General Accounting Office
                         441 G Street NW, Room LM
                         Washington, D.C. 20548
                         To order by Phone:     Voice: (202) 512-6000
                                                TDD: (202) 512-2537
                                                Fax: (202) 512-6061


To Report Fraud,         Contact:
                         Web site: www.gao.gov/fraudnet/fraudnet.htm
Waste, and Abuse in      E-mail: fraudnet@gao.gov
Federal Programs         Automated answering system: (800) 424-5454 or (202) 512-7470



Public Affairs           Jeff Nelligan, Managing Director, NelliganJ@gao.gov (202) 512-4800
                         U.S. General Accounting Office, 441 G Street NW, Room 7149
                         Washington, D.C. 20548
United States                  Presorted Standard
General Accounting Office      Postage & Fees Paid
Washington, D.C. 20548-0001           GAO
                                 Permit No. GI00
Official Business
Penalty for Private Use $300

Address Service Requested