oversight

National Forests: Administration of Outfitter and Guide Policies at the Gallatin Forest

Published by the Government Accountability Office on 1990-08-22.

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

                       IYnit,ed   States   General   Accounting   Office

                       Report to t,he Honorable
                       Conrad ISurns, U.S. Senate


-__I.




                       NATIONAL FORESTS
  Au~nst.   I!)90




                       Administration of
                       Outfitter and Guide
                       Policies at the Gallatin
                       Forest

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                    m--Not                to be released outside the
                    General Accounting Office unless specifically
                    approved by the Office of Congressional
                    Relations.
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                   United States
GAO                General Accounting Office
                   Washington, D.C. 20548

                   Denver Regional        Office                                       Suite 800
                                                                                       1244 Speer Boulevard
                   B-239963                                                            Denver, CO 80204-3681


                   August 22,199O

                   The Honorable Conrad Burns
                   United States Senate

                   Dear Senator Burns:

                   In your May 12, 1989, letter, you requested that we review allegations
                   made by a number of outfitters/guides (hereinafter referred to as outfit-
                   ters) operating in Montana national forests, that the Department of
                   Agriculture’s Forest Service has acted in an arbitrary manner in
                   deciding the number of service days outfitters are permitted to use the
                   forests.’ You also requested that we review allegations that the Forest
                   Service has favored some outfitters over others. In further discussions
                   with your office, we agreed to limit our review to the Gallatin National
                   Forest since that is where the allegations primarily occurred.


                   The Forest Service and outfitters operating in the Gallatin have been
Results in Brief   involved in a controversy since 1988 when the Forest Service began
                   requiring outfitters to have permits for day-use operations. (Day use
                   refers to outfitter-guided trips that do not involve overnight stays in the
                   forest.) The Forest Service contends that too many outfitters are oper-
                   ating in the Gallatin during the hunting season and, as a result, outfitter-
                   guided parties are having an adverse impact on other forest recreation
                   visitors (hikers, campers, horseback riders, etc.). Consequently, the
                   Forest Service wants to limit outfitters’ use of the forest. The standard
                   used by the Forest Service to set allowable outfitter service days under
                   the new day-use permit program is historical use levels. The outfitters
                   contend that historical use is not an acceptable standard and that the
                   forest can sustain higher levels of use.

                   The Forest Service does not now know, nor does it have plans to deter-
                   mine, the level of outfitter or other recreation use the forest can sustain.
                   Until such an assessment is completed, any limits to outfitter use
                   imposed by the Forest Service will be subject to challenge and the con-
                   troversy at the Gallatin will, in all likelihood, continue.

                   We believe problems similar to those at the Gallatin could also develop
                   at other forests because historical use has traditionally been the basis


                   ‘Service days are a day or a part of a day for each individual accompanied or provided services by an
                   outfitter; for example, 10 clients on a l-day trip would equal 10 service days.



                   Page 1                     GAO/RCED-90-163     Outfitter   and Guide Policies   at the Gallatin   Forest
             R-239963




             for determining outfitter service-day levels throughout the Forest Ser-
             vice. Should this occur the Forest Service would again lack knowledge of
             the forest’s capability to sustain various levels of recreational use
             because it does not believe such information is necessary to carry out
             federal policy to maximize forest recreation opportunities.

             Regarding alleged favoritism, some outfitters operating in the Gallatin
             believe that other outfitters have received improper favorable treat-
             ment in the forest’s management of the outfitter permitting program.
             Most complaints appear to have originated in one of the Gallatin ranger
             districts where two Forest Service employees had relatives who oper-
             ated as outfitters in the district. The question of whether favoritism has
             actually occurred could not be resolved from information we reviewed.
             However, we did find that Forest Service procedures do not provide ade-
             quate internal safeguards to ensure that such acts, or the appearance of
             such acts, do not occur.


             Forest Service policy requires permits for commercial activities
Background   (including outfitter operations) on national forest lands. Regarding out-
             fitters, before 1984 the Gallatin forest had generally applied the require-
             ment only to outfitter overnight trips. However, in a national policy
             review completed in 1984, the Forest Service re-emphasized that the
             requirement applied to all outfitter trips, whether the duration of the
             trip was a few hours (day use) or several days (overnight). In 1988, fol-
             lowing several delays, day-use permitting was implemented at the Gal-
             latin for the first time.

             Outfitters provide a wide range of guided recreational experiences for
             forest visitors and typically provide all necessary equipment, food, and
             transportation required for a trip. At the Gallatin most outfitter trips
             are to guide hunters. The demand for day-use outfitter hunting permits
             at the Gallatin is higher than at other Montana forests, primarily
             because large elk herds reside in the forest and other herds from the
             Yellowstone National Park annually migrate across the forest. During
             the 1989 fall hunting season, a total of 78 outfitters were authorized
             about 6,770 service days in the Gallatin. This compares to about 10,000
             days authorized in 1988.




             Page 2              GAO/RCED4iO-163   Outfitter   and Guide Policies   at the Gallatin   Forest
                        Limits on outfitter service days in the Gallatin, under the new day-use
Service-Day             permitting program, have generally been set on the basis of historical
Limitations Are Based   use levels. Outfitters have disputed the use of this criterion and main-
on Historical Data      tained that the Forest Service has no valid basis to determine the limits.

                        In January 1988 the Gallatin issued permitting procedures that limited
                        service days allowed for day-use permits to about 4,000 on the basis of
                        1981 data. According to Forest Service representatives, 1981 was
                        selected on the basis of a recommendation from the Montana Outfitters
                        and Guides Association that it represented a year of relatively high out-
                        fitter use and therefore would accommodate most historical users. How-
                        ever, the procedures were appealed by outfitters for various reasons,
                        including the selection of 1981 as a representative year and the method-
                        ology used in calculating the 4,000 service days, The Forest Service
                        stayed action on the appeals in mid-1988, pending the Gallatin’s recon-
                        sideration of its procedures.

                        In the fall of 1988, the Gallatin on a one-time basis authorized outfitters
                        as many service days as they needed to cover the actual number of cli-
                        ents each outfitter had booked. About 10,000 total day-use service days
                        were authorized in 1988.

                        In 1989 the Forest Service rewrote the day-use permit procedures. These
                        new procedures allocated day-use service days to individual outfitters
                        on the basis of the average of their 2 best operating years from 1983
                        through 1987. Authorized fall-hunting day-use service days totalled
                        about 6,770 in 1989. Again, some outfitters considered the new proce-
                        dures to be flawed and appealed the number of service days allocated to
                        them. Generally, those appealing believed the Forest Service had once
                        again applied procedures that were inappropriate and that unnecessa-
                        rily limited forest use.

                        The Forest Service plans to continue using the 1989 procedures until
                        new criteria for determining available service days are established by a
                        task force involving outfitters. However, the task force study, which is
                        to be completed in 1990, will not determine the level of outfitter and
                        other types of recreation activity the forest is capable of sustaining. The
                        Forest Service also plans to form outfitter resource associations that will
                        be authorized to allocate the new day-use service-day level to associa-
                        tion members and to regulate the number of outfitters operating in the
                        associations’ assigned areas. A Forest Service official at the Gallatin
                        estimated that full implementation of the procedures will take about 5
                        years after the new service-day criteria are finalized.


                        Page 8              GAO/RCED90-163   OutfItter   and Guide Policies   at the Gallatin   Forest
                        R-239963




                        The use of historical data as the primary criterion limiting the number
Historical Data Are     of available use days for any forest recreation activity does not provide
Not Adequate to         the Forest Service with an adequate basis to manage the forest in accor-
Establish Service-Day   dance with federal policy. Historical use data tell only what prior use
                        has been, not whether the forest can sustain a higher level of use or
Limits                  whether the historical level should be maintained or reduced to protect
                        resources. Federal policy requires the Forest Service to meet the public
                        demand for recreation opportunities on the forest at a level that realizes
                        the capabilities of the resource. The Forest Service currently provides
                        approximately 40 percent of all recreation days spent on federal lands
                        each year, and the public demand for recreational opportunities on fed-
                        eral lands is increasing.

                        An analogy to needing information to regulate forest use for outfitter-
                        guided visits and other recreational activities would be the Forest Ser-
                        vice’s grazing program. For this program the Forest Service conducts
                        grazing capacity assessments to set use levels2 The capacity assess-
                        ments consider such factors as resource capability and adverse resource
                        impacts, as well as the amount, type, location, and season of use. How-
                        ever, Forest Service officials told us they are not convinced similar
                        assessments of forest capacities for recreational activities, which may
                        be difficult to design and perform, are warranted.


                        Regarding your concern about whether the Forest Service favored some
Allegations of          outfitters over others, a few instances involving possible favoritism
Favoritism              were cited to us. The incidents cited generally pertained to one forest
                        district in the Gallatin and generally concerned two employees whose
                        relatives operated as outfitters in the district. The two employees held
                        positions in the forest district that might have afforded them the oppor-
                        tunity to influence decisions on outfitter permits. The documents we
                        reviewed did not resolve whether favoritism had actually taken place.

                        The Forest Service told us that because employees at the forest and dis-
                        trict levels often live in the local communities for many years, it would
                        not be uncommon for them to have relatives or social acquaintances
                        involved in commercial activities in the forest. Because of this closeness
                        to their communities, Forest Service employees may be particularly vul-
                        nerable to situations wherein they are suspected of awarding preferen-
                        tial treatment in their official duties. The Forest Service also pointed out

                                         ment: More Emphasis Needed on Declining and Overstocked Grazing Allot-
                                         80, June 10,1988).



                        Page 4              GAO/RCED-90-163    Outfitter   and Guide Policies   at the Gallatin   Forest
                    R-239903




                    that the relatively small number of staff assigned to each forest district
                    makes it difficult to realign duties among the staff to avoid potential
                    conflict-of-interest situations.

                    Acts of preferential treatment are specifically.prohibited under the
                    Forest Service’s employee code of conduct, but internal control proce-
                    dures to specifically identify and avoid situations likely to involve or
                    give an appearance of preferential treatment have not been established
                    at either the forest or regional level. We believe that formal internal con-
                    trols need to be established that will (1) clearly define prohibited acts of
                    favoritism, (2) provide criteria for avoiding conflict-of-interest situa-
                    tions, (3) instruct employees to bring possible conflict situations to their
                    supervisor’s attention, and (4) provide procedures for investigation and
                    resolution when acts of favoritism are alleged to have occurred.


                    In order to ensure that the public demand for recreation opportunities in
Recommendationsto   the Gallatin forest, including outfitter-guided visits, is met within the
the Secretary of    forest’s capabilities, we recommend that the Secretary of Agriculture
Agriculture         direct the Chief of the Forest Service to conduct such studies as may be
                    necessary to determine the level of recreational activities the forest can
                    sustain. Further, because the Forest Service has no plan to establish a
                    procedure for assessing forests’ capabilities to sustain recreational
                    activities even though the public demand for those activities is
                    increasing, we recommend that the Secretary direct the Chief to identify
                    those forests where recreational activity is substantial and to conduct
                    any additional studies that may be needed at those forests to adequately
                    determine their recreational capabilities, The Forest Service should then
                    be better prepared to manage recreational use to meet public demand
                    and to avoid lengthy, controversial disputes such as the one now occur-
                    ring at the Gallatin.

                    In order to ensure that acts of preferential treatment, or the appearance
                    of such acts, do not occur in the administration of the outfitter permit-
                    ting program, we recommend that the Secretary of Agriculture direct
                    the Chief of the Forest Service to develop internal control procedures
                    for use at all national forests to routinely identify and remedy possible
                    conflict-of-interest situations at the forest and ranger district levels.


                    In performing this review, we contacted officials at Forest Service head-
                    quarters and regional offices, as well as officials from the Gallatin and
                    Bitterroot forests who have responsibility over the outfitter program.


                    Page 5              GAO/RCED-30-163   Outfitter   and Guide Policies   at the Gallatin   Forest
    R-239963




    We also contacted individual outfitters who both supported and opposed
    the day-use permitting procedures; officers of the Montana Outfitters
    and Guides Association; representatives of the Montana outfitter
    licensing board, the Montana Department of Fish, Wildlife and Parks,
    the Montana Wildlife Federation, and the Public Lands Access Associa-
    tion Our review was conducted from June 1989 through March 1990, in
    accordance with generally accepted government accounting standards.
    Appendix I contains the details of our review. Appendixes II and III pro-
    vide additional information on formal appeals filed by outfitters.

    We discussed the contents of this report with Forest Service headquar-
    ters, regional, and forest officials on April 13 and May 1, 1990. While
    regional and forest officials generally believe that the current proce-
    dures for determining available outfitter service days are adequate,
    headquarters officials said they agree that an improved procedure is
    needed. On the issue of favoritism, headquarters, regional, and forest
    officials generally believe that the individual district ranger in charge at
    each forest district can adequately control potential conflict-of-interest
    situations without formalizing specific new internal controls for the pro-
    gram; therefore, the corrective action recommended is not necessary. We
    continue to believe that these improvements are needed. As requested,
    we did not obtain formal written agency comments on this report.

    Unless you publicly announce its contents earlier, we plan no further
    distribution of this report until 30 days from the date of this letter. At
    that time, we will send copies to the Secretary of Agriculture, the Chief
    of the Forest Service, and other interested parties and make copies
    available to others upon request.

    Major contributors to this report are listed in appendix IV.

    Sincerely yours,
r




    David A. Hanna
    Regional Manager




    Page 6              GAO/RCED-90-163   Outfitter   and Guide Policies   at the Gallatin        Forest




                                                                                             ,.
Y




    Page 7   GAO/WED-99-163   Outfitter   and Guide Policies   at the Gall&n   Forest
Contents



Appendix I
Implementation of         Background
                          Objectives, Scope, and Methodology
Day-Use Permitting        Service-Day Limitations
for Outfitters at the     Favoritism
Gallatin National
Forest
Appendix II                                                                                                       23
Principal Issues Raised
in Four 1988 Outfitter
Appeals of January
1988 Day-Use Permit
Procedures
Appendix III                                                                                                      24
Principal Issues Raised
in 13 Outfitter
Appeals of 1989 Day-
Use Permit Decisions
Appendix IV                                                                                                       25
Major Contributors to
This Report



                          Abbreviations

                          MOGA      Montana Outfitters and Guides Association
                          ORA       outfitter resource area


                          Page 8             GAO/BCED-90463   Outfitter   and Guide Policies at the Gallatin   Forest
Page 9   GAO/RCED-90-163   Outfitter   and Guide Policies   at the Gallatin   Forest




              1.:
Appendix I

Implementation of Day-Use Permitting for                                                                           ’
Outfitters at the Gallatin National Forest

                Forest Service policy has historically required permits for commercial
Background      activities such as outfitting, timber cutting, and grazing on national
                forest lands. The Forest Service has grouped the national forests into
                nine separate Forest Service regions, each managed by a regional for-
                ester. Individual forests, which are managed by a forest supervisor, are
                further subdivided into two or more forest districts, each of which is
                managed by a district ranger. Permits to conduct commercial activities
                in the forest are generally issued by a district ranger.

                While the requirement historically has been that all outfitters have a
                permit to operate on Forest Service lands, before 1984 the Gallatin
                forest had generally applied the requirement only to outfitter overnight
                trips. In a national policy review completed in 1984, the Forest Service
                re-emphasized that the requirement applied to all outfitter trips,
                whether the duration of the trip was a few hours (day use) or several
                days (overnight). In 1988, after several delays, day-use permitting was
                implemented at the Gallatin Forest for the first time.

                Overnight permits are valid for 6 years and are updated annually to
                include the outfitter’s current-year operating plan. Day-use permits are
                renewed annually. Both permit types authorize the outfitters a specific
                number of service days to operate in designated areas of the forest
                during a specific time of the year (e.g., a portion of the authorized days
                may be allocated for use during the spring hunting season and the
                remainder for the fall hunting season). Outfitters obtain their permit
                from the district ranger at the forest district in which they will prima-
                rily operate,’ but the permit can authorize operations in other forest dis-
                tricts as well. Outfitters operating in the Gallatin and in other national
                forests in Montana must also be licensed by the state.

                Outfitters offer a wide range of guided recreational experiences for
                forest visitors, typically providing all necessary equipment, food, and
                transportation required for a trip. At the Gallatin most outfitters’ trips
                are to guide hunters pursuing elk and other big game animals. The
                demand for day-use outfitter permits at the Gallatin is higher than at
                other Montana forests, primarily because of elk hunting. Large herds
                reside in the forest and on adjacent private land. In addition, two elk
                herds from Yellowstone National Park annually migrate across the Gal-
                latin. During the 1989 fall hunting season, 42 outfitters held only day-



                ‘The Gallatin forest is divided into five separate forest districts for management purposes.



                Page 10                    GAO/RCED-90-163      Outfitter   and Guide Policies   at the Gallath   Forest
                        Appendix1
                        J~~~~lemantation   of   Jhby-Uoe Permitting   for
                        Outflttem at the Gallatin NationalForest




                        use hunting permits at the Gallatin, 14 held only overnight hunting per-
                        mits, and 22 held both. During 1989, 12 other outfitters held permits for
                        nonhunting recreational activities.


                        Because of recent problems between outfitters and officials at the Gal-
Objectives, Scope,and   latin National Forest, Senator Conrad Burns of Montana requested that
Methodology             we review recent Forest Service actions affecting outfitters. This report
                        addresses allegations of (1) arbitrary actions by the Forest Service in
                        allocating available service days to outfitters and (2) possible favoritism
                        shown to some outfitters.

                        To aid our review, Senator Burns provided a list of individuals we could
                        contact who represented a cross-section of views on the issues. We con-
                        tacted most of these individuals, who were generally outfitters at the
                        Gallatin, either by telephone or in person. To obtain other relevant
                        views, we also spoke with present and past officers of the Montana Out-
                        fitters and Guides Association (MOGA). In addition, at the requester’s
                        suggestion we contacted two interested local organizations: the Public
                        Land Access Association and the Montana Wildlife Federation.

                        At the Forest Service we spoke with headquarters, regional, forest, and
                        district officials involved in outfitter management. There we obtained
                        detailed information on management policies and procedures and docu-
                        mented historical information about the forest’s capacity to support
                        commercial outfitter activities. We also obtained specific information on
                        outfitter permit administration and reviewed specific outfitter permit
                        and correspondence files to determine if they contained indications of
                        improper Forest Service actions.

                        To obtain background information on state outfitter licensing proce-
                        dures and state records of historical outfitter activity, we spoke with
                        representatives of the State Board of Outfitters and the Montana
                        Department of Fish, Wildlife and Parks. These officials also provided
                        background information on other recreational matters on which they
                        work closely with the Forest Service, including wildlife herd manage-
                        ment and game violations.

                        We found that serious controversies concerning day-use permits existed
                        primarily at the Gallatin. Similar controversies had not occurred at the
                        Bitterroot forest because fewer outfitters operate there, and requests for
                        outfitter day-use permits had generally been accommodated. For this



                        Page 11                       GAO/RCRD-SO-163       Outfitter   and Guide Policies   at the Gallatin   Forest
                                                                                                                              -- .
                             Appendix I
                             Implementation    of Day-Use Permitting for
                             Ontflttem   at the Gallatin National Forest




                             reason our review and report concentrates on disputes associated with
                             day-use permitting at the Gallatin.


                             Much of the controversy that occurred at the Gallatin related to the
Service-Day                  number of operating days outfitters were allocated or the area of the
Limitations                  forest in which they were authorized to operate under the day-use
                             permit requirement implemented in 1988. Generally, outfitters granted
                             permits under this requirement had previously conducted day-use oper-
                             ations in the Gallatin without restriction, in some cases for many years.
                             Under the requirement some outfitters’ business was reduced because
                             they either were authorized fewer operating days or were allotted a
                             smaller area of the forest in which to operate. Some outfitters had to
                             discontinue day-use operations because they did not qualify for a permit
                             under the new procedures. Some outfitters viewed the reduction or elim-
                             ination of their historic day-use activity as inequitable and, in some
                             cases, as causing a significant economic burden for the affected
                             outfitter.

                             The Forest Service does not know how much outfitter day-use activity
                             the Gallatin can actually sustain without adversely affecting the
                             resource, and we believe that uncertainty lies at the heart of the contro-
                             versy. Generally, the Forest Service believes that too many outfitters
                             are operating in the Gallatin for both day-use and overnight hunting
                             activity and, as a result, outfitter-guided parties are having an adverse
                             impact on other recreational visitors. For that reason, Gallatin officials
                             decided that day-use permits would not exceed historic use patterns.
                             Many outfitters, however, hold the view that the Gallatin could actually
                             sustain a significantly higher level of outfitter hunting activity without
                             adverse impact on the forest. They cite low overall public-use levels in
                             certain areas and increasing elk herd sizes in support of their position.
                             These outfitters generally believe that imposing procedures which limit
                             outfitters to the use level of some historical period, without first deter-
                             mining what level of outfitter activity the forest is capable of sustaining,
                             constitutes arbitrary action by the Forest Service.


Initial Steps to Implement   In 1985 the Forest Service took initial steps to begin implementing the
the Day-Use Permit           national policy requirement for outfitter day-use hunting permits at the
                             Gallatin. At that time it was decided, in consultation with representa-
RequirementY
                             tives from the state outfitters’ association, that the permitted day-use
                             activity would initially be implemented at the 1981 outfitter use level.



                             Page 12                   GAO/RCED-90-162     Outfitter   and Guide Policies   at the Gallatin    Forest
                            In~plementatIon    of DayWee Pem&dng      for
                            Outflttun   at the Gallatln National Fomt




                            According to the Forest Service, 1981 was selected on the basis of a rec-
                            ommendation from MGGA that it represented a year of relatively high
                            outfitter use and therefore would accommodate most historical users.

                            In September 1986 the Forest Service initiated a survey to identify out-
                            fitters with day-use operations at the Gallatin. A general news release
                            was published and an inquiry was sent to all area outfitters asking them
                            to provide data on their operations. A total of 95 outfitters responded;
                            37 reported day-use hunting activity in the forest. After reconciling the
                            reported use with outfitter records submitted to the state, the Forest
                            Service concluded that there had been 4,013 service days of outfitter
                            day-use hunting activity in the Gallatin in 1981.2

                            Day-use permitting was not implemented in 1986 because of reduced
                            staffing at the Gallatin caused by a decrease in the forest’s recreation
                            budget. In May 1987 the Gallatin Forest Supervisor contacted all parties
                            who responded to the 1985 survey, existing overnight permittees, and
                            other various interest and user groups to help identify criteria to con-
                            sider in evaluating permit applications and allocating available service
                            days. Later, an ad hoc advisory group, which included outfitters,
                            assisted in the fmvelopment         of implementation procedures and
                            guidelines to be used by district rangers in evaluating day-use applica-
                            tions for permits.


Allocation Procedures for   The initial controversy over outfitter day-use permitting at the Gallatin
the 1988 Season             forest arose when permitting guidelines for the new program were
                            issued on January 29, 1988. Essentially, the guidelines provided that (1)
                            day use would be authorized only in specific forest areas, (2) a max-
                            imum of 4,013 service days would be permitted, (3) applicants would be
                            required to have a qualifying base of operations within a “reasonable”
                            distance of the planned operating area, (4) day use would be considered
                            only in areas of reasonable and uncontested public access to the forest,
                            and (6) applicants had to have a viable business that had been in opera-
                            tion since 1986. The guidelines also established an order of preference
                            for qualified applicants that gave priority to nearby outfitters with eco-
                            nomically sound, year-long business operations.

                            In March 1988 four separate appeals involving a total of 31 outfitters
                            were filed contesting the new guidelines. MOGA filed one of the appeals

                            ?his total 1981 use level was subsequently included in the 1987 Gallatin National Forest Plan as the
                            limit on days available for day-use hunting permits in the forest.



                            Page 18                    GAO/RCEINO-163       Outfitt.er   and Guide Policies   at the Gallatin   Forest
                               Appendix   I
                               Implement&Ionof Day-UsePennWingfor
                               Ootflttere at the Gallath National Forest




                               on behalf of 22 of its members; 7 other outfitters filed a second group
                               appeal; and individual outfitters filed the remaining two appeals, each
                               on his own behalf. Overall, the four appeals addressed a range of issues
                               that are summarized in appendix II. Generally the appellants challenged
                               the need for a day-use permit system, the overall limit set on outfitter
                               service days, public access requirements in the permit guidelines, and
                               protested the anticipated adverse economic impact the permit require-
                               ment would have on affected outfitters.

                               In a May 2, 1988, decision, the Regional Forester dismissed the appeals
                               on the basis that the guidelines did not constitute formalized Forest Ser-
                               vice policy and, as such, could not be appealed. The Regional Forester
                               ruled that the outfitters would still have the opportunity to appeal any
                               later decision related to their individual applications for a permit. The
                               decision to dismiss was subsequently appealed, and that appeal was
                               later placed on hold to give the Forest Service and the outfitters an
                               opportunity to work out a settlement.

                               Since permit issuance guidelines for day-use hunting were still incom-
                               plete at the time of the 1988 fall hunting season, the State Board of Out-
                               fitters asked the Forest Service at the Gallatin to honor all firm outfitter
                               client bookings for 1988 by issuing permits with sufficient outfitter days
                               to cover those bookings. Permitting at that level was requested on a one-
                               time only basis to allow a phase-in of the permitting requirement. The
                               Gallatin Forest Supervisor granted the request. Under this arrangement
                               67 outfitters applied for and received a total of about 10,000 permitted
                               day-use service days for that 1 year, of which about 9,200 were for fall
                               hunting. Actual use data for the full year were not available but,
                               according to the Gallatin’s recreation staff officer, the outfitters actually
                               used about 7,000 of the permitted fall-hunting days, This use level is
                               about 76 percent above the 4,013 historical use-day demand the Forest
                               Service calculated on the basis of 1981 data. In our opinion, the signifi-
                               cant difference in use days between what the Forest Service proposed to
                               allocate and the outfitters’ client bookings provides insight into why the
                               Forest Service’s proposal was controversial and unacceptable to some
                               outfitters.


Allocatinn   P1
          ____
             _ rocedures for   In June 1989 agreement was reached with MOGA on revised procedures
bllt; XKJ~Season
CL,   1nc                      for awarding permits and allocating service days available for day-use
                               outfitting. In a final step prior to Forest Service implementation, the
                               State Board of Outfitters asked 86 outfitters in the Gallatin area to vote
                               on the acceptability of the new procedures. According to MOGA the 86


                               Page 14                  GAO/RCED-SO-163    Outfitter   and Guide PolSciea at the Gallatin   Forest
    Implementation     of D8yJJee Permitting for
    (Mflttern   at the Galhtln National    Forest




    outfitters surveyed were those believed most likely to be affected by the
    new procedures. MOGA informed the Forest Service that the surveyed
    outfitters had approved the procedures 37 to 16 (1 abstained, 1 was
    ruled invalid, and 31 did not respond). Following MOGA'S notification of
    approval, the Forest Service issued the new procedures effective for the
    fall 1989 hunting season. Once implemented, the new procedures had
    the effect of closing out any further action on the stayed 1988 appeal
    cases.

    The new procedures provided for a two-phased approach to day-use
    permitting. Phase one involved interim procedures that were used to
    issue permits in 1989 and that will continue in effect until phase two is
    implemented. Phase two will provide permanent day-use permit
    procedures.

    Under the interim phase-one procedures, only the following applicants
    are eligible for Gallatin day-use permits:

. Those who had previously applied by the March 11, 1988, application
  deadline set under the original January 1988 procedures.
l Those who, as of March 11,1988, held, and currently hold, an active
  state outfitter license and who provided evidence of historic Gallatin use
  prior to March 11, 1988.
9 Those who have a qualifying base of operation within a 50-mile distance
  of their operating area in the Gallatin and who have adequate
  equipment.

    During phase one the authorized use level is based on the average of the
    individual outfitter’s actual highest use days during 2 of 5 years from
    1983 to 1987 as determined from state outfitter records. Authorizations
    are for the specific area of predominant historical use, and outfitters
    with different seasons or types of use (e.g., spring bear hunting and fall
    elk hunting) can be assigned to more than one use area. Seventy-eight
    outfitters received day-use permits totaling about 6,770 authorized fall-
    hunting service days in 1989.3

    A second round of controversy arose following the issuance of 1989 per-
    mits. Again some outfitters considered the methodology and implemen-
    tation flawed as it applied to their particular situations and appealed

    “The Forest Service could not provide data on the total spring-hunting service days the 1989 permits
    authorized. In 1988, however, fall-hunting service days represented 91.6 percent of the annual total
    permitted that year.



    Page 16                    GAO/lUXIM@tf33       OutfItter   and Guide Policies   at the Gallath   Forest
                                Appendix I
                                Implementation    of Day4Jee Permitting for
                                Outflttem~ at the Gallatln Natlonal Forest




                                the number of service days allocated to them. In all, 13 appeals were
                                filed with the Forest Service, and those appeals were still unresolved at
                                the time our field work was completed in March 1990. (The specific
                                issues addressed in the 1989 appeals are summarized in app. III.) Gener-
                                ally, the appellants challenged individual reductions in their authorized
                                service days or geographic operating area and objected to the negative
                                economic impact of those reductions on their businesses.


Current Status of Day-Use       The Forest Service plans to use the interim phase-one permit procedures
Implementation                  until the permanent phase-two procedures are completed and installed.
                                In phase two outfitters will be assigned to separate outfitter resource
                                areas (ORAS)within the Gallatin. Outfitters in each ORAwill form an out-
                                fitter’s association for their particular area and each association will
                                design the rules of operation for managing use levels and outfitter num-
                                bers in its area. Once established, each individual outfitter association
                                would determine for its own members the method or methods for

                            l allocating increases and decreases in use among association members,
                            l managing temporary use allocated to the association, and
                            . managing an increase or decrease in the number of outfitters in the ORA.

                                Service days will be transferrable to other association members under
                                certain conditions, and reassignment of unused service days among
                                members would be permissible without compensation.

                                In preparing for phase two the Forest Service established a cross-section
                                task force to design and recommend criteria to the Forest Service for use
                                in establishing available outfitter service days at the Gallatin. That task
                                force met initially in February and is scheduled to complete its work in
                                1990. The task force, chaired by the Forest Service, consists of one out-
                                fitter from the state licensing board, two outfitters from the state outfit-
                                ters association, one representative from the State Department of Fish,
                                Wildlife and Parks, one representative from each of two public interest
                                groups, and one member of the public at large.

                                Some outfitters we spoke with were skeptical about the workability of
                                the phase-two procedures, which the Forest Service does not expect to
                                be fully implemented for about 5 years. Others we spoke with were cau-
                                tiously optimistic that the new procedures would represent an improved
                                system for allocating available service days and would provide a mecha-
                                nism for outfitter businesses to grow over time. A Forest Service official



                                Page 16                   GAO/RCJZD-fiO-163   Outfitter   and Guide Policies   at the Gallatin   Forest
                   Appendix I
                   Implementation     of Day&e   Permitting for
                   Outfitters  at the Gallatin National Forest




                   told us he expects that the new phase-two criteria for determining avail-
                   able service days will probably maintain available outfitter day-use ser-
                   vice days at about the 1989 permitted level of 6,770.


Recreational Use   The controversy surrounding the implementation of outfitter day-use
                   permits for the Gallatin has primarily centered on outfitters’ attempts to
                   maintain their proportional share of historical use under the new permit
                   requirement; however, we believe that the controversy actually reflects
                   an even larger problem, That is, the Gallatin has not determined the
                   overall capability of the forest to support recreational visitors, including
                   those that are outfitter-guided,4 Further, the Forest Service generally
                   has not conducted assessments of forests’ recreational capabilities any-
                   where in the national forest system.

                   The nation relies heavily on the Forest Service to accommodate the
                   national demand for recreational opportunities on federal lands. The
                   Forest Service currently provides approximately 40 percent of all recre-
                   ational days spent on federal lands each year, most of which is spent in
                   undeveloped forest areas. Further, the public demand for recreational
                   opportunities on federal lands is increasing. Outfitters offer guided rec-
                   reational experiences in undeveloped areas to members of the public
                   who choose not to go there unguided. In this sense, outfitters play an
                   important role in making recreational opportunities on national forests
                   available to that segment of the public.

                   The Forest Service contends there are too many outfitters and wants to
                   limit their forest use. Outfitter-guided visitors comprise about 5 percent
                   of recreational use in the Gallatin. No effort is being made to limit the
                   other 95 percent of recreational use that comes from unguided forest
                   visitors. The Forest Service cites the opinions of some outfitters, and
                   several recent incidents of disputes in the Gallatin involving outfitters,
                   as support for its view that too many outfitters already operate in the
                   Gallatin. The Forest Service, however, has no other analysis or data to
                   demonstrate that outfitter overuse actually is occurring.

                   While the Forest Service is attempting to limit outfitter use of the Gal-
                   latin, some outfitters want to expand usage either to increase the size of
                   their businesses or just to remain economically viable. Also, a number of
                   outfitters told us that they are unable to meet their client demand with

                   +lBe Forest Service at the Gallatin defines the forest capacity for recreation-related activity as the
                   amount of recreational use an area can sustain without deterioration of site quality.



                   Page 17                     GAO/RCED@O-ltX3      Outfitter   and Guide Policies   at the GaJlatin   Forest
Appendix I
Implementation     of Day-Use Pen&king    for
Ont!lttms   at the Gallatln National Forest




the service days they currently have available. Regional and forest offi-
cials generally agree that if additional outfitter hunting service days
were made available in the Gallatin, they would be applied for both by
the outfitters currently holding permits and by others not now
permitted.

Overall, current outfitter-permitting procedures at the Gallatin have the
effect of preventing an increase in the public’s use of outfitter-guided
trips in the forest, without first determining if an increase could be
accommodated. In our view this approach fails to satisfy current federal
policy for management of recreation on the national forest lands. Fed-
eral policy requires the Forest Service to meet the public demand for
recreational opportunities in the forest at a level that realizes the capa-
bilities of the resource. We believe that before the Forest Service can
comply with this policy requirement at the Gallatin, it must first deter-
mine the level of recreational activity the forest can sustain.

We also believe problems similar to those at the Gallatin could develop
at other national forests. Forest Service policy has traditionally based
outfitter service-day levels at national forests on historical use without
systematically determining either the level of outfitter and other recrea-
tional activity that can be sustained or if there is an unmet demand for
outfitter service days. A regional Forest Service official told us that
comprehensive assessments of forest capabilities to support higher
levels of recreational use, including those visitors who are outfitter-
guided, have not been performed for any of the forests in the region and
none are planned. Further, headquarters officials stated they did not
know of any such assessments of overall recreational capabilities having
been performed for forests in other regions.

The Forest Service also told us it is not convinced that assessments for
outfitter and other recreational activities are warranted at the national
forests, since no forests other than the Gallatin have experienced signifi-
cant outfitter-related problems. They told us that assessment studies
have historically been used only in their grazing program where use
determinations are less complex.” They believe that it would be much
more difficult to develop a methodology for measuring a forest’s capa-
bility to sustain all types of recreational use, including commercial out-
fitter activity. For example, any method for assessing outfitter use
would have to consider factors beyond just sustaining the resource base;

“The capacity for grazing at the Gallatin is generally defiied as the maximum stocking rate possible
without damaging the vegetation or related resources.



Page 18                    GAO/RCED-90-163      Outfitter   and Guide Policies   at the Gallatin   Forest
     .



             Implementation     of Day-Use Perndttlng for
             Outflttere  at the Gallatln National Forest




             social factors, such as the frequency of contact with other forest visi-
             tors, may prove to be equally important. While regional and forest offi-
             cials generally believe that current program procedures are adequate for
             managing the outfitter program, headquarters officials told us that they
             agree that an improved procedure for determining available outfitter
             service days is needed.

             We also believe that until such information is developed, and available
             outfitter service days are adjusted to reflect that resource capability,
             any limitations the Forest Service sets on outfitter service days will be
             subject to charges of being arbitrary.


             Several of the outfitters we spoke with believed that favoritism had
Favoritism   been shown to other outfitters who had relatives employed at one
             ranger district in the Gallatin forest. Specific incidents of alleged favor-
             itism involved administration of the outfitter permitting program gener-
             ally and included, but were not limited to, day-use activities. We found
             that the activities alleged, if they occurred, were prohibited under the
             Forest Service’s employee code of conduct, but the accuracy of the alle-
             gations were neither proven nor disproven by information we reviewed.
             We believe, however, that Forest Service procedures do not provide ade-
             quate internal safeguards to ensure that such acts of favoritism do not
             occur. We were told that except for the code of conduct prohibition
             against granting favoritism, no other formal Forest Service policies or
             procedures have been established to routinely identify and avoid poten-
             tial conflict-of-interest situations,

             The allegations we received generally involved outfitter permit adminis-
             tration in the Gardiner District of the Gallatin forest, where two Forest
             Service employees were related to outfitters who operated in the dis-
             trict.” Both employees held positions that normally would involve peri-
             odically reporting on, or evaluating, the performance of outfitters.
             Unsatisfactory performance evaluations can result in administrative
             action being taken against the outfitter’s permit, including probation or
             revocation.

             It was also alleged that the employees might have been able to influence
             other decisions affecting outfitters. For example, in one case we were
             told that an outfitter related to a Forest Service employee was not cited

             “One of the two employees retired from the Forest Service in July 1989. The other employee still was
             assigned to the Gardiner District as of March 1990.



             Page 19                    GAO/RCED-99-163     Outfitter   and Guide Policies   at the Gallatin   Forest
                                                                                                 --
Appendix I
Implementation     of Day-&e Pemdtting for
Out.fltte~% at the Gallatin National Forest




for violating the closure of one forest area during a fire, while another
outfitter was cited for the same violation. The outfitter cited was placed
on probation, but no action was taken against the related outfitter.
Forest Service records we reviewed did not resolve whether the related
outfitter had in fact violated the closure, nor did they contain any other
indication of favoritism having occurred.

Another report we received was that certain Forest Service contracts
that are available to outfitters from time to time to provide services,
such as trail maintenance or packing-in supplies to a fire area, were
being awarded disproportionately to the outfitters related to Forest Ser-
vice employees. Information the Gardiner District provided to us on its
contract awards from 1986 to 1988, however, did not support that this
was occurring.

While we found no evidence that these and the other specific incidents
had actually involved favoritism, many outfitters we spoke with believe
that favoritism does occur in the administration of outfitter permits. In
addition to cases involving relatives of Forest Service employees, there
are concerns that certain other outfitters not related to Forest Service
employees may also be receiving improper favorable treatment. For
example, some outfitters we spoke to told us they believed that a partic-
ular outfitter was awarded more service days than he was entitled to.
Again, however, we found no evidence to support that this was
occurring.

The Forest Service told us that because employees at the forest and dis-
trict levels often live in the local communities for many years, it would
not be uncommon for them to have relatives or social acquaintances
involved in commercial activities in the forest. Because of this closeness
to their communities, Forest Service employees may be particularly vul-
nerable to situations wherein they are suspected of awarding preferen-
tial treatment in their official duties. We believe it is also likely that the
Gallatin’s general no-growth policy on available outfitter service days
leads to an increased sensitivity among outfitters to possible Forest Ser-
vice acts of favoritism.

We believe that better internal controls are needed to ensure that out-
fitter program decisions are made in a fair and impartial manner and to
avoid public perceptions that certain outfitters may be receiving
improper favorable treatment. The Forest Service code of conduct
clearly requires employees to avoid any action that might create the
appearance of giving preferential treatment, and employees certify


Page 20                   GAO/RCED-9@162      Outfitter   and Guide Policies   at the Gallatin    Forest
Appemllx I
Implementation     of Day-Use Permitting for
Ontflttem   at the Gallatin National Forest




annually that they are familiar with all code of conduct requirements.
No other formal management controls have been established, however,
to prevent acts of favoritism from occurring.

Forest Service officials at both the Gallatin forest and regional head-
quarters told us that no specific, formal procedures have been estab-
lished to ensure that employees are not involved in program
administration matters involving their relatives or to protect against
other possible preferential treatment situations. Forest Service head-
quarters officials we spoke with generally believe that the individual
district ranger in charge at each forest district can adequately control
potential conflict-of-interest situations without formalizing specific new
internal controls for that purpose. They also point out that the rela-
tively small number of staff assigned to each forest district makes it
difficult to realign duties among the staff to avoid a potential conflict-
of-interest situation. We believe however, that the frequent perception
of favoritism that we found among outfitters and the controversy sur-
rounding day-use permits provide strong evidence that improved
internal controls are needed to avoid even the appearance of a conflict-
of-interest on the part of Forest Service employees.

At the Gardiner District we were told that the informal policy there for
more than 10 years has been to separate duties in such a way that
employees do not deal directly with their relatives on program matters.
In our opinion the existence of such an informal policy is helpful, but we
found that the district had not documented what action, if any, it had
taken in response to the informal policy. We believe the lack of docu-
mentation is largely attributable to the fact that the district’s policy is
not adequately detailed and has not been formalized. The lack of docu-
mentation that any district action was taken to avoid the conflicts of
interest that have been alleged, however, demonstrates the need for
improved management controls. If the current policy were more detailed
in its guidance, and if it had been formalized and made a part of stan-
dard written operating procedures for the district, we believe it is more
likely that any district actions taken to avoid a conflict-of-interest would
have been documented. Further, with documentation the district could
have better demonstrated to parties concerned about favoritism that its
policy was followed. We do not believe that further defining and formal-
izing the existing informal policy, and documenting actions to implement
the policy, would make forest district operations significantly more
difficult.




Page 21                    GAO/RCED-90-102     Outfitter   and Guide Policies   at the Gallatin   Forest
Appendix I
Implementation     of Day-Use Permitting for
Outflttms   at the Gallatin National Forest




We believe the Forest Service itself, however, is the best qualified to
identify and consider the range of specific internal controls that could
be established, and to select those most appropriate to forest agency
operations. At a minimum, however, we believe that the procedures
finally selected should (1) clearly define what constitutes a prohibited
act of favoritism, (2) establish criteria and procedures for identifying
and avoiding potential conflict-of-interest situations before they occur,
(3) instruct employees to bring possible conflict situations to their
supervisor’s attention, and (4) provide for followup investigation and
resolution of the facts and appropriate documentation when allegations
are raised that favoritism has occurred. We further believe that the
internal controls should be standardized agency-wide as formal written
operating procedures to avoid future situations of perceived favoritism,
such as the one that currently exists at the Gallatin’s Gardiner district.




Page 22                    GAO/RCED-90-163     Outfitter   and Guide Policies   at the Gallatin   Forest
Appendix II

Principal IssuesRaked in Four 1988 Outfitter
Appeals of January 1988 Day-Use
Permit Procedures
                                                      Appeal #I          Appeal #2        Appeal #3          Appeal #4
                Issue appealed                        (22 parties)       (7 parties)      (1 PaW             (1 pafiy)
                Permit policy too vaaue               X                  X
                Outfitter policy linked to public     X                                   X
                access issue
                Impact of policy on future sale       X
                value of outfitter’s business
                Restrictive limit on available        X                                                      X
                service davs
                Conflicts with various laws           X
                and regulations
                Inadequate public notice and          X
                comment
                Lack of environmental                 X
                assessment
                Economic impact on outfitters         X
                and community
                Permit requirement                                       X                X                  X
                inappropriate if just crossing
                forest land
                Need for day-use permits not          -                                   X
                demonstrated
                Inadequate outfitter                                     X
                involvement in policy
                develooment
                Opposition to base-of-                -                  -                                   X
                operations requirement
                Other eligibility criteria            -                                                      X
                Outfitter not granted tenure          -                                                      X
                status for dav-use permit9
                aPermits are issued for a 5-year period rather than a l-year period if tenure status is granted. Also, with
                tenure status, rights to the days permitted may usually be transferred to a new owner if the outfitter
                business is sold during the permit period.




                Page 23                      GAO/RCED-99-163       Outfitter   and Guide Policies   at the Gallatin   Forest
Appendix III                                                                                                         ‘C

Principal IssuesRaised in 13 Outfitter Appeals1
of 1989 Day-Use Permit Decisions

                                                                                                              Number of
                                                                                                               outfitters
                Iarue aDDoIled                                                                                apDealina
                The number of service days authorized for operation by the 1989 permit was
                fewer than the outfitters’ historical annual operating days                                                   6
                The area of the Gallatin in which day-use operation was authorized by the
                1989 permit was smaller than the outfitters’ historical operating area                                        4
                Ruling that the outfitter did not have a qualifying base of operation                                         3
                The number of service days authorized were not sufficient for economic
                operation                                                                                                     2
                Validity of Gallatin permit procedures
                Denial of a day-use operation permit based on no qualifying historic use
                Whether day-use implementation procedures discriminate against outfitters
                and the guided public
                %everal of the outfitter appeals raised more than one issue.




                Page 24                     GAO/RCED-SO-163      Outf’itter   and Guide Policies   at the Gallatin   Forest
           ?

Appe-ndix IV

Major Contributors to This Report


              -
Resources,              Charles S. Cotton, .4ssistant Director-in-Charge
Community, and          James R. Hunt, Assistant Director
Economic
Development Division,
Washington, D.C.
                        Sue Ellen Naiberk, Regional Management Representative
Denver Regional         Bennet E. Severson, Evaluator-in-Charge
Office                  Donald T. Beltz, Senior Evaluator




(14072B)                Page 25              GAO/RCED90-152   Outfitter   and Guide Policies   at the Gallatin   Forest
‘I   :i.
r          ---~-_I.-.-F_...--.“_--~-.



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