From the start of fiscal year 1990 through the end of fiscal year 1993, the Salvage Sale Fund’s balance more than doubled, from $111 million to a high of $247 million (see table 1). Declines through fiscal year 1996 lowered the balance to $186 million, a drop of 25 percent. Several Management Practices Affect How the Fund Is Replenished

Several management practices that affect the flow of salvage sale receipts into the fund need to be improved to ensure more consistency in the salvage sale program. Specifically, these practices include how regions and forests (1) establish priorities for distributing salvage sale receipts, (2) establish estimates of costs to be recovered, (3) review salvage sale plans for completeness and accuracy, and (4) satisfactorily correct deficiencies. The Forest Service said that the report accurately and fairly presented the information about the fund’s balance and the management practices affecting the replenishment of the fund. To obtain information on the current status of the Salvage Sale Fund’s balance, we requested information on fiscal year 1996 receipts, expenditures, and the fund’s ending balance and reviewed the Forest Service’s fiscal year 1997 projections for salvage sale deposits and obligations.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the status of the Salvage Sale Fund's balance and the management practices affecting the replenishment of the fund.

What GAO Found

GAO noted that: (1) after reaching a high of $247 million at the end of fiscal year (FY) 1993, the Salvage Sale Fund's balance declined 25 percent to $186 million at the end of FY 1996; (2) the decline occurred for a variety of reasons, and the fund's balance appears to be stabilizing in FY 1997; (3) if the Forest Service's estimates are correct, the Salvage Sale Fund's balance will total about $182 million at the end of FY 1997, a balance the Forest Service believes is sufficient to meet the estimated obligations for FY 1998; (4) several management practices that affect the flow of salvage sale receipts into the Salvage Sale Fund need to be improved; and (5) specifically, these practices include how regions and forests: (a) establish priorities for distributing salvage timber sale receipts; (b) establish estimates of the costs to recovered; (c) review salvage sale plans for completeness and accuracy; and (d) satisfactorily correct deficiencies.