Prominent among the stewardship contracting  authorities is the ability to (1) trade goods—timber, for example—for  contract services, such as thinning of small trees and brush, and (2)  retain for use in future stewardship projects any revenue generated  through selling forest products such as timber, rather than returning  the revenue to the Department of the Treasury, as is required for  traditional timber sales. These timber sales are funded by the Management of  Lands and Resources appropriation, which was $10.4 million in fiscal year  2006. The Forest Service’s Aggregation of Obligation and Expenditure Data Hinders Field-Level Project Management

The Forest Service tracks obligation and expenditure data at the program  and forest levels through its accounting system—the Department of  Agriculture’s Foundation Financial Information System (FFIS). To  compensate for the lack of detailed information, field managers have spent  considerable time and effort to develop and maintain a variety of “cuff  records,” such as spreadsheets, that contain the data they need to manage  their projects, including timber sales. These obligations include costs for personnel, vehicles, and  supplies and equipment. Lacking the System Data They Need, Many Field Managers Rely on Cuff Records

Although several Forest Service officials contend that information on  district- and project-level obligations and expenditures is not needed,  managers we talked to at various levels of the Service’s field organization  said they rely on cuff records, such as spreadsheets, to track this  information and help manage their projects. As a result, these  managers have created cuff records to monitor projects as they proceed. Forest Service headquarters  officials told us that the agency has not attempted to determine the  amount of time currently spent by field managers tracking this information  or the associated costs of doing so. Both Agencies Have Systems That Track Revenue by Timber Sale

The Timber Sale Accounting system maintains the Forest Service’s timber  sales revenue data, while two systems—the Timber Sale Information  System and the Collections and Billing System—maintain BLM’s timber  sales revenue data. The system tracks the volume, type, and  value of timber harvested by individual timber sale; automatically  generates bills to timber purchasers; and tracks payments against these  bills. TSA tracks revenue from sales conducted with appropriated monies  as well as those conducted with monies from the salvage sale and pipeline  funds. TSA maintains timber sales revenue data by individual timber sale contract  or permit. The  reporting system in CBS allows staff to track revenue in various ways,  such as by sale, purchaser, type of timber, or fund. BLM developed a separate system for recording revenue from timber sales  conducted under stewardship contracting authority, the Stewardship  Contracting Information Database (SCID). Recommendation for Executive Action

To ensure that field managers responsible for carrying out Forest Service  operations have the data they need to manage effectively, and to provide  the Congress and the public with useful cost data to assess the fiscal  accountability of Service operations, we recommend that the Secretary of  Agriculture direct the Chief of the Forest Service to systematically  determine the information needs of the field managers on whom the  Service relies to carry out its operations, and, based on the results of this  analysis, take appropriate action to provide data that meet those  information needs. In addition, given  that the Department of the Interior’s Bureau of Land Management (BLM)  also conducts timber sales, we included that agency in our review. Specifically, our objectives were to determine the extent to which (1) the  Forest Service tracks timber sales-related obligations and expenditures,  including the extent to which the Service uses this information in making  management decisions; (2) BLM tracks timber sales-related obligations  and expenditures, and how BLM’s methods for doing so compare to those  of the Forest Service; and (3) the Forest Service and BLM account for their  timber sales-related revenue.
Why GAO Did This Study

For years, GAO has raised concerns about the ability of the Department of Agriculture's Forest Service (Service) to track the amounts it obligates for and spends on timber sales and to use this information in managing the sales. Timber sales are generally carried out by ranger districts (the lowest level of the Service's decentralized organizational structure), which are overseen by national forest offices. The Bureau of Land Management (BLM) within the Department of the Interior also conducts timber sales. This report examines the extent to which (1) the Forest Service tracks timber sales-related obligations and expenditures, including the extent to which the Service uses this information in making management decisions; (2) BLM tracks timber sales-related obligations and expenditures; and (3) both agencies track their timber sales-related revenue.

What GAO Found

The Forest Service tracks the funds it spends to conduct timber sales--such as funds for personnel and equipment--in a way that does not provide the detailed data many field managers, such as district rangers and forest supervisors, told us they need in order to properly manage these sales. The Service's accounting system aggregates obligation and expenditure data by the programs that fund the sales--such as the Forest Products Program and the Salvage Sale Program--and by national forest, rather than by individual timber sale or by ranger district. Forest Service headquarters officials told us that field managers do not need sale-by-sale or district-level data. However, many field managers told us that such data are crucial to their management of timber sales. For example, without such data to monitor the progress and cost of individual sales, field managers have difficulty both knowing when to redirect resources among sales and assessing the cost-effectiveness of individual sales. Without detailed data in the Service's accounting system, many field managers have developed manual "cuff records," such as spreadsheets, to maintain obligation and expenditure data at the individual sale or ranger district level. However, maintaining these cuff records can be time consuming, according to field managers, and can thus take time away from conducting "on the ground" activities such as overseeing timber harvests. Although headquarters officials said that aggregating data has reduced the cost of managing the accounting system data, the resources field managers are expending to compensate for the lack of detailed system data may partially offset those savings. However, the Service does not know the cost of maintaining cuff records, and it has not systematically identified field managers' information needs. BLM, in contrast to the Forest Service, tracks many timber sales obligations and expenditures by individual sale. BLM has chosen to maintain detailed data in order to allow its field managers to use these data in managing timber sales--by, for example, monitoring the progress and cost of sales. As a result of BLM's approach, field managers have access to detailed data without relying on cuff records. Overall, the Forest Service and BLM have systems that track revenue data by timber sale. These systems track the volume, type, and value of timber harvested; generate bills to timber purchasers; and track payments against those bills. Both agencies have struggled with, but are resolving, the challenge of tracking revenue from sales conducted under their stewardship contracting authority. Stewardship contracts generally involve the exchange of goods, such as timber, for contract services, such as thinning of brush. The Forest Service recently added a module to its accounting system to track revenue from stewardship contracting projects, while BLM has developed a database for this purpose.