Corporate Welfare in the U.S. Forest Service

[Janice Shields <jshields@essential.org>]

                  TIMBER SALE PROGRAM LOSSES ON FEDERAL LANDS
  
  
  *    The Forest Service assigns timber sales to one of three
       categories, based on the goals of the sale: (1) the timber
       commodity component, which includes sales that are supposed to
       help meet the needs of U.S. citizens for wood products; (2)
       the stewardship component (salvage), which includes sales that
       are intended to help achieve desired ecological conditions and
       non-timber objectives outlined in forest plans; and, (3) the
       personal use component, which includes sales of forest
       products such as firewood and Christmas trees to individuals
       for personal use.
  
  *    All but one [Chippewa (MN)] of the 121 Forest Service forests
       generated negative net revenues in at least one of the three
       components during fiscal year 1994, the most recent year for
       which public data are available.  Seventy-four of the 121 (61
       percent) forests generated negative net revenues in at least
       two components and 35 (29 percent) generated negative net
       revenues in all three components. 
  
  *    Fifty of the 121 forests (41 percent) generated negative net
       revenues in the timber component in 1994; 43 of these 50
       forests also generated negative net revenues in the timber
       component in 1993.  The 1994 timber commodity negative net
       revenues from these 50 forests totalled $20,694,000.
  
  *    Sixty-three of the 121 forests (52 percent) generated negative
       net revenues in the salvage component in 1994.  The 1994
       negative net revenues of these 63 forests totalled
       $19,306,000; negative net revenues in the salvage component in
       1993 totalled $18,385,000.  When the stewardship component's
       share of Washington and regional costs is allocated to forests
       based on harvest volume, 1994 losses from salvage sales in
       negative net revenue forests jump to $28,687,000.  
  
  *    Increased salvage sales won't reduce the federal deficit. 
       Fifty percent of revenue from salvage sales is added to the
       Salvage Sales Fund to cover costs to prepare and administer
       future salvage sales and for associated roads, 25 percent goes
       to the Knutson-Vandenberg Fund and is used primarily for
       reforestation activities, and 25 percent is distributed to the
       states and benefits the public schools and public roads in
       counties within the national forests.
  
  *    The 1994 total negative net revenues generated by forests
       whose revenues were less than costs in the commercial timber
       and salvage components was $40 million [$20,694,000 timber +
       $19,306,000 salvage].  The negative net revenues understate
       the total dollar amount of below-cost sales because: (1)
       profitable sales are combined with below-cost sales in
       negative net revenue forests*; (2) below-cost sales in
       positive net revenue forests are excluded; and, (3) allocable
       regional and Washington office costs of $90,492,000 are
       excluded.  *[For example, a sale that generates a profit of
       $80 is added to a sale that incurs a loss of $100, resulting
       in a net loss of $20.  However, losses on below-cost sales
       total $100.]
  
  *    The impact of logging on non-timber resources, including
       recreation, wildlife, fish, grazing and water, is reported for
       each forest as the present net value of the net benefits
       (positive minus negative effects) less costs.  Seventeen
       forests reported negative present net values in 1994; the
       total negative present net value for these forests was
       $16,073,000.
  
  -----
  Janice Shields
  Center for Study of Responsive Law
  P.O. Box 19367, Washington, DC  20036
  202-387-8030			|   Internet:	jshields@essential.org