Public Forest$: Do We Get What We Pay For?

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Public Lands, Part II: Special Report on Management of National Forests

(Editor’s Note: In this issue we conclude a special two-part series devoted to the report, Forests: Do We Get What We Pay For? Because of the importance of this report, TimberLine will reprint it nearly in its entirety; it has been edited for space limitations. It is the second in a series of Public Land reports by Holly Lippke Fretwell, a research associate with the Political Economy Research Center (PERC), that examines how the federal government manages the nation’s wealth of natural resources. The first report, The Price We Pay, compared the fiscal accountability of federal land management agencies with that of state agencies. Copies of the reports may be obtained by contacting PERC at (406) 586-9591), or

Giant trees crash to the forest floor, crumbling beneath their own weight. A once magnificent forest is reduced to a jumble of dead timber. Each lost tree thins the overstory, which reduces the closed canopy. As a result, the Forest Service is losing the wildlife habitat it is attempting to preserve. Known as the “Valley of Death,” this region of the Shasta-Trinity National Forest of Northern California was designated a late successional reserve under President Clinton’s Pacific Northwest Forest Plan. These reserves were intended to serve as habitat for late successional and old-growth species including the northern spotted owl. A single pair of owls remains nested in the vicinity, but in the future it is unlikely that other species requiring mature forest habitat will find a home in this reserve. Opportunities for preserving late successional habitat are better on private lands less prone to catastrophic loss, says a forester with the Shasta-Trinity National Forest.

Under the president’s forest plan, the thinning and salvage harvesting that would normally take place are not permitted. The result is higher mortality from disease and insects as well as greater risk of catastrophic loss due to fire. In the McCloud region of the Shasta-Trinity National Forest, root disease and bark beetles have reached epidemic proportions, resulting in tree mortality as high as 80% in heavily infested areas. The consequences include severe fire hazard and the elimination of the very habitat for which the area was preserved.

How to save what is left of the forest has been the subject of ongoing discussions for 10 years. A late successional reserve assessment, required by the forest plan, is under way. Upon its completion, a federal impact analysis threatens to further postpone action as the controversy boils again. Frustrated by the maze of regulation, forest managers predict that it will be at least several more years before any treatment to halt the infestation takes place. Meanwhile, the area of tree mortality continues to expand, destroying approximately 300 additional acres each year. Future plans for restoration must now include the high cost of removing the fuel buildup of dead trees, rather than the revenue that could have been generated from a thinning or salvage operation to improve forest health.

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Intermixed with the national forest land are private lands. Like the national forest, the land was originally logged at the turn of the century and has since grown into a forest providing late successional habitat. The private forests, however, have been thinned and salvage timber has been harvested, promoting optimum growth and forest health. These forests support habitat for northern spotted owls and carry low fuel loads, thus reducing the risk of catastrophic wildfires. The landowners’ primary objective is to grow and harvest forest products while still providing a variety of other forest values, such as wildlife habitat, clean water, and recreation. Active management is the only way to ensure these values today and into the future.

One Spark from Disaster

As the road dropped out of the Sierras into the Lake Tahoe basin below, the scenery made an abrupt change from healthy, green forests to dead and dying stands of timber. The congressmen on their way to the June 1997 Presidential Summit on the problems facing the lake and surrounding basin were taken aback by what they saw. Later, during a session on forest health, U.S. Senator Richard Bryan of Nevada exclaimed, “This forest looks like hell!” It appeared as if someone had drawn an imaginary line across the landscape and then nurtured the trees on one side, while destroying those on the other.

The Tahoe Basin was once forested with well-spaced Jeffrey and ponderosa pines. Moderate intensity wildfires burned thousands of acres each year, preventing shade-tolerant fir from taking hold in the soils of the basin. In a tragedy of the commons, early settlers and silver miners razed most of the pines. Ensuing years of fire suppression and restricted harvest enabled fire-prone fir to grow in dense stands, replacing the earlier pines. The Forest Service estimates that basin forests are 82% denser today than in 1928. Now, after eight years of drought, bark beetles and disease have ravaged overstocked stands, killing more than 80% of the trees.

In jeopardy is Lake Tahoe, known as one of the clearest, deepest lakes in the world. Its beauty has drawn 60,000 residents to the basin area and attracts 3.5 million visitors every year. Deteriorating air quality is a growing concern, and the pristine quality of the lake is being threatened by erosion and pollution. Studies show it is losing nearly a foot in clarity each year. Ironically, forest management practices on surrounding federal lands have put at risk the very qualities they were supposed to preserve: the integrity of the forest and the clarity of the lake below. Environmental regulations have delayed some management actions and restricted timber harvests and forest treatments.

Meanwhile, the forest has changed dramatically, resulting in high tree mortality. This tinderbox of dead and dying trees is at grave risk to wildfire that could threaten the basin with even greater erosion and air quality degradation, while destroying homes and vacation getaways sprinkled throughout the forest. The potential for loss of property and life to wildfire is higher than nearly anywhere else in California.

To prevent increased erosion from wildfire, the Forest Service has estimated that 10,000 acres need to be treated annually — far more than the 200 acres now treated each year. As trees sicken and die, the once green forest is turning to shades of brown. A single spark could destroy the recreational opportunities and economic stability of the Lake Tahoe basin. Only through selective thinning and prescribed burn can the risk of conflagration be reduced.

On adjacent lands just above the national forest, the trees remain vigorous and healthy. With a similar history of early forest clearing followed by fire suppression, these stands have escaped the bug infestation and high mortality. These privately owned timberlands are intensively managed to ensure vigor and high productivity. Unlike federal forest managers, private timberland managers responding to the bottom line have protected their forest assets over time.

The Profit Motive

Summer camp-outs, fall hunting trips, and year-round rambles in fragrant pine forests were a treasured part of life for thousands of residents of Arkansas, Louisiana, and Texas. Without free access to large areas of public lands such as in the West, these outdoor enthusiasts relied on the generosity of the International Paper Company (IP) to provide them with free use of its 1.2 million acres of private timberlands in the mid-South. Despite this heavy recreational use, the company managed its lands with one goal in mind — timber production, the main source of its revenue.

By the early 1980s, however, the steadily increasing demand for recreation convinced company executives that charging fees for recreation made sense. Through the sale of daily use permits, seasonal family permits, and multi-year leases to hunting clubs, the company generated significant revenues. From zero in 1980, revenues grew to $2 million in 1986, representing 25% of the company’s total profits in that region. By 1999, the earnings from non-timber sources were $5 million. As the profits grew, so did the incentive to manage the forests for recreation as well as timber.

To enhance wildlife production, corridors of trees were maintained between harvest areas for wildlife movement. In areas that previously would have been clear-cut, clumps of trees were left standing to provide greater age diversity. The overall size of the timber cuts was reduced and the perimeters made irregular, thus more attractive to a greater variety of wildlife. Riparian areas were protected by restricting harvests along streams. Long-term contracts with hunting clubs provided an incentive for the club members to act as stewards of their leased land and work cooperatively with IP managers.

These efforts have paid big dividends to wildlife and stockholders. Game surveys in 1996 showed that populations of whitetail deer increased five-fold and turkey ten-fold, along with substantial increases in fox, quail, ducks, and nongame populations. The incentive for IP to change its land management came from the revenues generated by fee-based recreation programs and the growing interest in sustainable forest management.

Until recently, most of the fees collected on federal lands were returned to the treasury. Visitor demands for more recreational opportunities or increased wildlife were not addressed. Forest managers had no incentive to spend the money appropriated by Congress on visitors who made no direct financial contribution.

The good news is federal officials are beginning to recognize the importance of revenues from recreation. The bad news is, they have yet to learn what IP has discovered: Integrating timber production and wildlife conservation can be beneficial.

A Tale of Two Forests

As darkness fell over the weary hunters returning to camp, the grins on their faces told the tale of a successful hunt — five trophy-sized elk harvested in five days. The largest bull scored 404 points, easily surpassing the 375 points required for entry into the Boone and Crockett record book. Because of today’s crowded hunting conditions, this would be considered an extraordinary hunt in most parts the country, but it was typical for the Fort Apache Reservation in Arizona. Prior to 1977, the Arizona Game and Fish Department had managed hunting on the reservation. Its goal was to maximize hunter days, which translated into 700 annual elk permits at $150 each. When the White Mountain Apache tribe took control of hunting on the reservation, it made some drastic changes. In its first year of operation, the tribe issued just 12 permits, but the price was $750 each. Today, through careful management of wildlife habitat, the tribe has arguably the best elk herd in North America. Only 70 permits are now issued each year for trophy bull elk and they cost upwards of $24,000 each. The waiting list for a permit is five years.

To improve the quality of the herd, the tribe not only reduced hunting pressure, but it hired biologists to assist with land management. Open meadows that provide abundant forage were protected, livestock grazing was reduced, and logging was restricted in the high country, riparian zones, and mountain meadows. But timber is still a top-revenue producer at $7 million a year.

By combining market incentives with a tradition of land stewardship, the White Mountain Apache tribe has developed a flourishing wildlife community, recreational activities, and 700,000 acres of productive forest land in east central Arizona. Through careful management, the tribe has further enhanced its already substantial income from natural resources.

In contrast, elk are disappearing from the Clearwater National Forest in Idaho, once considered a mecca for wildlife. Much of the Clearwater basin burned in the great fires of 1910 that were the impetus for the fire suppression policies adopted by the Forest Service. Since then, the forest has been managed in the absence of fire, resulting in an even-aged stand of dense fir. Without the openings and meadows historically created by fire, the elk have nowhere to graze. The dense thicket of undergrowth blocks the sunlight and prevents the growth of essential forage. Over time, elk and other wildlife have virtually disappeared from the forest ecosystem. Only recently has public dissatisfaction prompted federal managers to act. A working group composed of local citizens, the Forest Service, and the U.S. Fish and Wildlife Service has formed to create solutions and lure the elk back into the Clearwater.

Forest Service Roads

September is a month of stunning beauty at the Snow Bank Recreation Area in southwestern Montana’s Gallatin National Forest. The vibrant yellows and oranges of the aspens and cottonwoods mix with the deep greens of pine and spruce to create an arresting tapestry. Thousands of recreationists are drawn into the forest for a weekend drive or an end-of-season camp-out. Cars, trucks, RVs, ATVs, and mountain bikes crowd the road, sending plumes of dust into the air. This Forest Service road and many more like it are thoroughfares, providing millions of Americans with easy access to the nation’s forests.

In fact, there are 380,000 miles of Forest Service roads, a distance eight times longer than our interstate highway system. And like our interstates, they are built to carry heavy traffic and remain in perpetuity. These high-quality roads are expensive projects; in 1997, the average cost for one mile of Forest Service road was $64,000. Although originally built for timber removal and paid for with congressional appropriations for the timber harvesting program, 98% of their use is for recreation. Yet recreational users pay nothing for these roads — neither for their construction nor their maintenance.

Congressional appropriations for road building create an incentive to build more and more roads in the national forests. The projects provide work for Forest Service engineers, planners, and other staff, expanding the size of the agency. Furthermore, forest managers must add roads for recreational use in order to meet their annual goals; the more roads, the higher their performance rating.

The excessive number of roads running through the forests are beginning to take their toll on the environment. During the first half of the century, roads were built to much lower standards. Many of these roads are now deteriorating, causing hillside erosion, water quality degradation, and other environmental problems. Congress continues to appropriate money for road building but little for maintenance. As a result, there is now a maintenance backlog of $10 billion.

Recreation fees could help maintain roads and also ration visitors in congested areas. Without these fees or a bottom line where operating costs are funded from revenues, federal forest managers have no incentive to reduce road building, make repairs, or obliterate timber roads. In fact they have the incentive to do just the opposite.

Alternatively, state timber roads cost less and are less damaging to the environment. Building specifications are much lower than federal standards because of the planned short-term use. For example, in Montana a state timber road costs about $5,000 per mile and is built solely for the purpose of timber removal and reforestation. The fact that state managers must adhere to a bottom line prevents overinvestment in roads. Furthermore, state forests are required to generate a positive return for public schools. Thus, many roads are routinely obliterated, eliminating the threat of environmental damage or the need for maintenance. Some are retained as foot trails for recreational use and in some states, such as Arizona, Montana, and New Mexico, a small fee is charged for recreation on state lands.


Americans are not getting what they pay for. Although hundreds of millions of dollars are spent on our federal forest lands every year to ensure ecological health, productivity, and biodiversity, the photographs and stories in this report show forests that exhibit almost none of these values. Instead, they are inhospitable to both wildlife and recreational visitors and at risk of devastation from disease, insects, and catastrophic wildfire.

Our federal land management system is clearly dysfunctional and harmful to the health of our national forests. Forest managers must respond to a multitude of demands that are contrary to their goal of healthy forest ecosystems: political interests, short-term bureaucratic goals, perverse incentives, and stultifying layers of regulations that reflect neither local nor regional differences. Yet other timber lands exhibit healthy, vigorous forest ecosystems. Private land owners who grow trees for commercial harvest have a long-term commitment to the value of the timber and a strong incentive to manage for a productive forest. In recent years, the growing market in outdoor recreation has created additional incentives for private owners to manage their lands for wildlife, recreational opportunities, and other environmental amenities. Similarly, the managers of state trust lands have shown that with less political interference and clear mandates to generate revenues for public schools, public timberlands can be managed to benefit both forest health and the state residents.

The solution proposed by environmentalists and being rapidly embraced by the Forest Service is to stop logging and focus on recreation. But this report and the recent Government Accounting Office report show that logging should be part of the ecological and economic solution. Federal forest managers could restore our public forests to health and productivity if only Congress would remove the barriers and provide positive incentives for sound scientific management. Toward that end, we recommend several policy changes:

• Require federal forest managers to pay costs from revenues earned. Managers would be responsible for setting recreational fees, planning harvests, and creating other revenue opportunities compatible with forest health. When these revenues are retained by managers, they create a positive incentive to respond to visitor demands and protect the resources, while also insulating the managers from political pressures.

• Decentralize forest management by allowing local and regional concerns to guide management decisions. Applying the same set of principles to forests in widely differing regions can prove more harmful than beneficial.

• Encourage competitive bidding for forest uses. Managers could accept fees for retaining timber stands or harvesting them. The relative value of forest uses — recreation, environmental protection, or commodity production — helps managers determine the resource’s best use and eliminates gridlock.

• Devolve some federal forest lands to state or private management. Private property owners and state agencies manage their lands for the greatest productivity, including both commodities and environmental amenities.