In acting on the Forest Service appropriations for fiscal year 1995, the House and Senate Appropriations Committees (1) consolidated line items in the agency’s budget for which specific amounts of funds are allocated, (2) expanded the agency’s authority to reprogram funds without requesting the Committees’ approval, and (3) restructured the agency’s budget so that all funding to carry out a project—including the funding for services provided by others—is consolidated in the program that will benefit most from the project. As agreed with their offices, this report discusses (1) the Forest Service’s implementation of the fiscal year 1995 reforms and (2) the progress that the agency has made toward becoming more accountable for its results. The Budget Reforms Have Resulted in Little Change in Managing the National Forests

The Forest Service’s management of the National Forest System has not appreciably changed as a result of the increased flexibility offered by the fiscal year 1995 budget reforms. However, the agency has seldom requested such approval either before or after the reforms. Thus, the reforms have not had a noticeable impact on the number of reprogrammings requested from the Appropriations Committees. This practice circumvents the requirements established by the Appropriations Committees and the agency to move funds between line items and understates a project’s costs. On the basis of information provided by the Forest Service, the agency submitted one or two requests a year for the Appropriations Committees’ approval to reprogram funds among line items for the National Forest System in fiscal years 1994 through 1997. In addition, the Forest Service has developed agencywide criteria to allocate appropriated funds to its regions and forests. However, (1) the Forest Service’s budget allocation criteria are often not linked to the agency’s strategic goals and objectives; (2) its performance measures do not, in many instances, adequately reflect its accomplishments or progress toward achieving its goals and objectives; and (3) the management cost and performance reporting system that the agency was, and is still, developing uses the performance measures as input. The broad discretion that the Forest Service has given its field and program managers has resulted in, among other things, (1) some forest and district offices continuing to distribute and track funds as if the reforms had not occurred, (2) some field managers redistributing work charged to other activities after the fact in order to achieve or maintain specific levels of funding within activities, and (3) programs without the funds needed to pay for a project’s support services requiring other programs that are providing the support to absorb the costs of the services rather than seeking to meet their needs by moving funds between line items or by requesting a reprogramming of funds by the Chief of the Forest Service or the House and Senate Appropriations Committees. Although the Appropriations Committees gave the agency increased flexibility over its budget, the Forest Service has not provided the Committees with the improved accountability that they requested. As a result, the Forest Service, the Congress, and other interested parties do not have an adequate measure of the agency’s funding needs or its progress toward achieving its goals and objectives.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the Forest Service's implementation of fiscal year (FY) 1995 budget reforms, focusing on the progress that the agency has made toward becoming more accountable for its results.

What GAO Found

GAO noted that: (1) the Forest Service's management of the National Forest System has not appreciably changed as a result of the increased flexibility offered by the FY 1995 budget reforms; (2) consolidating the line items was intended to provide field managers with greater discretion in deciding where to spend funds to better achieve the agency's goals and objectives; (3) however: (a) some field offices have continued to distribute and track funds as if the consolidation had not occurred; and (b) the budget is still structured primarily by individual resource-specific programs; (4) the reforms expanded the Forest Service's authority to move funds between line items without the appropriations committees' approval; (5) the agency has seldom requested such approval either before or after the reforms; (6) the agency submitted one or two requests a year for the Appropriations committees' approval to move funds among line items for the National Forest System in fiscal years 1994 through 1997; (7) the reforms have not had a noticeable impact on the number of times that the Forest Service has made such requests of the committees; (8) the reforms restructured the agency's budget so that all the funding for a project is consolidated in the program that will benefit most from the project; (9) however, a benefitting program may not have the funds needed to implement a project; (10) it may require other programs that are providing support services to absorb the costs of those services; (11) this practice circumvents the requirements established by the appropriations committees and the agency to move funds between line items and understates a project's costs; (12) the Forest Service has not provided Congress with the improved accountability that the appropriations committees requested when they gave the agency increased flexibility over its budget; (13) GAO found that: (a) the agencywide criteria developed by the Forest Service to allocate appropriated funds to its regions and forests are often not linked to its strategic goals and objectives; (b) the agency's performance measures do not adequately reflect its accomplishments or progress toward achieving the goals and objectives; and (c) the management cost and performance reporting system that the agency has been developing for over 10 years uses the inadequate performance measures as input; and (14) the Forest Service, Congress, and others do not have an adequate measure of the agency's funding needs or its progress toward achieving its goals and objectives.