What’s Up With?: Forest Service Budget Modernization

So far, I’ve heard about the Forest Service Budget Modernization Effort from a few people and a discussion with cooperators put on by Sustainable Northwest today.
If I recall correctly from the SN discussion:

It’s in response to Congress’s (continuing) displeasure at the FS lack of transparency in the budget.
R-6 is doing it differently than other regions.
In R-6 they’re going to run fixed costs out of the RO.

I’ve asked contacts for something already written about this, but have received nothing so far. There’s a description around page 138 of the 2021 budget justification, but I’m wondering how it’s playing out and if is a description out there somewhere at a generic level for fellow FS aficionados.

Note from Region 5 Regional Forester on Covid, Fire, Recreation and Great American Outdoors Act $$$$$

R-5’s recreation site status map

Thanks to NAFSR for posting this link.

Many interesting things but I liked the recreation status map:

Recreating responsibly will help ensure that expanded access to recreational facilities, services, and opportunities continue. We ask for your help to continue getting this word out. This
summer, we launched a Geographic Information System (GIS) map that provides the public with updated information on the status of campgrounds, day-use sites, picnic areas, and other designated recreation sites on national forests throughout California…before they travel. You can view the GIS map at https://www.fs.fed.us/r5/webmaps/RecreationSiteStatus/.

I was also very pleased with the signing of the Great American Outdoors Act, which will enable federal land managers to take aggressive steps to address deferred maintenance and other infrastructure projects on national forests and grasslands. It will allow us to deliver higher quality customer service, enhance the visitor experience, and serve as a major catalyst for rural
economic development and employment opportunities through the projects funded and the resulting increase in tourism and recreation activity.

The Forest Service anticipates up to $285 million nationally, and up to $60 million regionally, on an annual basis over the next 5 years from the National Parks and Public Land Legacy
Restoration Fund. The bill also provides $900 million annually to the USDA and DOI through the Land and Water Conservation Fund, which will improve access to public lands, further
strengthening the recreation economy based on national forests and grasslands. Recreation on national forest lands in California contributes over 2 billion dollars to the California economy.
The agency is diligently working to provide priority lists to the Department regarding federal land acquisition and deferred maintenance projects on national forests and grasslands.

I guess I hadn’t realized the scale of $ of GAOA at the Regional level. Of course, he says “up to 60 mill on an annual basis” for the Region, and I don’t know what factors would influence the “up to”. Anyone have more info on this?

Collaborating on national forest exploitation – an oxymoron?

“Attendees engaged in fruitful conversations during the Green Mountain and Finger Lakes National Forests hosted Environmental Analysis and Decision Making collaboration summit. USDA Forest Service photo.”

“Before retiring, James Burchfield worked as a field forester for the Forest Service and served as dean of the W.A. Franke College of Forestry and Conservation at the University of Montana.”  Where our careers overlapped, he was known for his support of and expertise in collaboration in national forest management.  We have argued on this blog about the proper role of collaboration (it flared up again in the Rim Fire recent example), but in this Missoulian column he points out what I think most would agree is an improper role (on his way to making another point about adequately funding the Forest Service).

In 2002, former Chief Dale Bosworth, who now resides in Missoula, reminded the agency of the concept of stewardship, where the focus is not what we take from the land but what we leave on the land. I fear we may be forgetting these vital lessons.

The June 12 visit to Missoula by Agriculture Secretary Sonny Perdue to announce his Secretarial Memorandum on new agency priorities reminds us how easily we may be lured in the wrong direction. His mandate to “increase America’s energy dominance” and “reduce regulatory burdens” comes on the heels of a June 4 Presidential Executive Order that orders federal agencies to set aside environmental impact requirements because of the economic downturn caused by the COVID-19 pandemic. Certainly, the nation must take assertive measures to restore the economy, but a command to exploit complex ecological systems without appropriate environmental reviews, guaranteed by the National Environmental Policy Act (NEPA), abandons the sound principle of “look before you leap.” Further, forcing the Forest Service to meet production targets on a narrow range of resource benefits — those that can be commodified in the marketplace — discounts other critical resource values such as clean water, wildlife habitat and recreation opportunities that are well-recognized as central to Montana’s economic vitality.

Moreover, the Forest Service has learned its best outcomes emerge only after ongoing deliberations among partners and local residents to apply their nuanced knowledge and experience. This process actually happens in Montana via the decades of efforts by the 20-plus voluntary groups known as forest collaboratives that regularly engage with agency staff to improve project design, build understanding, and help get work done. These collaborative groups do not enter their deliberations with presupposed notions of resource exploitation. They want the best for the land.  

(My emphasis.)  I was always skeptical that including those with strictly monetary interests in collaborative efforts comported with this principle.  I assumed that there would have to be collaborative agreement with the desired outcome as step 1.  (This is also where forest plans should make an important contribution by defining the desired condition of the land.)  After Perdue’s announcement, it’s hard to see how any truly collaborative effort today could get past that step.

 

 

Oil and Gas Revenue, LWCF and the Great American Outdoors Act

 

Unfortunately, finding info on the internet does not always lead to info on the year and pub

Thanks to Shawn Regan of PERC for sending in these two pieces relating to funding for LWCF and the Great American Outdoors Act, related to my previous post here that dealt with the impacts of a possible Biden policy of “no new oil and gas leases” on LWCF.

The first is by Jack Smith, titled  “How Will We Pay For the Land and Water Conservation Fund?

How much federal revenue could offshore wind generate? The technical energy potential of winds off the U.S. coast is titanic—about 2,000 GW, or nearly double the amount of energy the entire country uses today. But the latest projections suggest that it will take a long time to realize offshore wind’s potential, so funding for the LWCF will probably depend on oil and gas revenue through at least 2050.

To see why, it’s important to understand the different fees energy developers pay the federal government to develop offshore energy resources. These are the revenues that currently sustain the LWCF and a myriad of other funds and programs.

First, developers bid for leases to tracts of property in auctions held by a federal land agency—in the offshore context, the Bureau of Ocean Energy Management. Whichever company wins each auction pays the winning bid—called a “bonus bid”—and then begins paying rent on the number of acres in their lease. Once a developer begins to produce and sell a resource from their lease, they pay the federal government a cut of every unit they produce, called a royalty.

Of these three revenue streams that fund the LWCF, royalties are by far the largest. In 2019, offshore fossil fuel energy royalties totaled $5.0 billion, 84 percent of the total $5.9 billion in offshore energy revenue. Bonus bids and rental payments together provided the other 16 percent.

Offshore wind royalties so far have generated zero dollars, since no project is far enough along to generate energy. But in theory, such projects could generate huge returns in the long run. At the current royalty rate of $5,010 per MW, harnessing all 2,000 GW of technically recoverable offshore wind energy would generate more than $10 billion per year in royalties. Building that much wind capacity is far beyond America’s foreseeable needs, grids’ load-balancing capabilities, and any realistic time horizon. But in the long run, it sets an upper bound for royalty revenue.

So it looks like wind energy probably won’t single-handedly fund the LWCF for at least 30 years, which means that the Great American Outdoors Act will continue to rely in large part on oil and gas revenue.

As a result, it’s clear that fully funding the LWCF permanently will present challenges. Fossil fuel development is increasingly under attack due to concerns about climate change. As policymakers seek permanent funding for conservation and recreation, the challenge will be to find other, more dependable funding sources to sustain outdoor recreation and conservation…

Historically, federal programs and obligations have consumed about half of federal energy revenues, leaving a large chunk in the U.S. Treasury for general use. In fiscal year 2019, that chunk was worth $5.0 billion—a level that would easily fill the maintenance fund’s annual $1.9 billion limit. But so far this fiscal year, federal energy revenues are down $1.7 billion. Unless federal energy revenues increase, it looks like there may not be enough funding this year to fully fund the public land maintenance-portion of the new legislation.

That’s important because a primary goal of the Great American Outdoors Act is to pay for billions of dollars’ worth of unmet maintenance needs in national parks and other public lands across the country—but without enough federal energy revenues to go around, those needs could go unmet even if the bill passes.

This potential shortfall highlights the risk of tethering public lands funding to federal energy revenues, which have become increasingly exposed to volatile oil prices. In the past 15 years, oil revenue has come to dominate the federal energy revenue stream; by 2019, federal oil revenue was $6.6 billion, more than half of total federal energy revenues. That means that an oil price crash has an outsized impact and potentially limits all programs that rely on federal energy revenues.

What’s Up With: Biden “No New Leases” and Funding LWCF?

From Idaho LWCF summary.

Colorado Senator Gardner (R) and Senator Manchin of WVA (D) were responsible for shepherding the recent LWCF bill through Congress and getting it signed by the President.  Their efforts were greatly supported by the conservation community in general.

Here’s a link to the Forest Service LWCF page. I couldn’t get the map to work, and I’d be interested in whether others can.

Currently the push from organizations like the Land and Water Conservation Fund Coalition is to get Congress to use all the funds (you can sign on to a letter).

It was a simple idea: use revenues from the depletion of one natural resource – offshore oil and gas – to support the conservation of another precious resource – our land and water. Every year, $900 million in royalties paid by energy companies drilling for oil and gas on the Outer Continental Shelf (OCS) are put into this fund. The money is intended to protect national parks, areas around rivers and lakes, national forests, and national wildlife refuges from development, and to provide matching grants for state and local parks and recreation projects.  Over the years, LWCF has also grown and evolved to include grants to protect working forests, wildlife habitat, critical drinking water supplies and disappearing battlefields, as well as increased use of easements.

Yet, nearly every year, Congress breaks its own promise to the American people and diverts much of this funding to uses other than conserving our most important lands and waters.

Now as part of Senator Biden’s campaign, he pledged to “ban new oil and gas permitting on public lands and waters” (from the WaPo compendium of positions). I wasn’t sure (1) that the OCS counts as public lands or waters or (2) perhaps the OCS is all leased anyway. Of course, I’m also not sure that “public” is the right word, as I’m not sure the Prez can legally dictate what happens on the land of other government entities.

I couldn’t find any info on this anywhere, and finally a kindly E&E reporter gave me this link to a story by E&E News reporter Kellie Lunney. I hope you can read the whole thing, but I’m not sure about the E&E paywall. Some excerpts:

It’s not an entirely new argument. Members of Congress from energy-producing states, including Louisiana, have pointed out over the years that oil and gas drilling revenues pay for a wide range of conservation and coastal restoration projects, including LWCF.

But it’s an argument that could end up gaining more traction than some more gimmicky attempts — such as that the Green New Deal will eliminate hamburgers and milkshakes — that opponents have used to mock the framework as unrealistic and foolish (E&E Daily, Feb. 28).

“Yeah, I think it’s a Catch-22,” said House Natural Resources Chairman Raúl Grijalva (D-Ariz.) about the dependence of programs like LWCF on oil and gas revenues.

“The more we become dependent on that, the more the push is going to be to expand that, and I think we need to mitigate that.”

Grijalva helped craft the public lands package and push permanent LWCF reauthorization along with the panel’s top Republican, Rep. Rob Bishop of Utah.

The chairman said that other than straight-up appropriations for LWCF, there are “not too many” other funding mechanisms he could envision for the program if the offshore drilling revenue stream were to dry up.

But that’s why it’s important now to allocate more money to the fund than it has traditionally received, to “maximize its use” and start making the transition from offshore revenue-dependent funding, Grijalva said.

The authorized funding level for LWCF is $900 million, but it has hardly ever been funded at that level; its annual appropriations in recent years have typically been about half that.

There’s also GOMESA

The 2006 Gulf of Mexico Energy Security Act (GOMESA), passed shortly after Hurricane Katrina, allows four Gulf Coast states — Alabama, Louisiana, Mississippi and Texas — to share 37.5 percent of oil and gas revenues produced in federal waters off their coasts to assist them with coastal restoration and storm protection.

It’s a critical program for the area, and one the region’s lawmakers fiercely defend.

Louisiana Rep. Garret Graves (R) has referred to the state’s coastal region as being the “goose laying the golden egg” for the federal government when it comes to LWCF, and possibly a trust fund of unallocated revenues to pay for the massive public lands and national parks maintenance backlog (E&E Daily, Nov. 13, 2018).

A portion of GOMESA revenues also helps fund LWCF. Alabama, Louisiana, Mississippi and Texas generated $200 billion in offshore oil and gas revenue last year for the federal government.

What I got from all this is (1) in the short run, with Biden’s promise (and assuming Congress goes along with it) money will keep flowing in from current leases, (2) in the medium term, that funding would dry up and need to be replaced by another source of funding (renewable energy on federal land?) or to the general taxpayers (but that requires budget battles that they may not win). So perhaps we ought to think about replacement in terms of payments to the feds (and the state portion) for future wind and solar leases on federal land. It’s probably not too soon to start thinking about it.

(2) folks in Congress are actually working across the aisle (even possibly unlikely ones like Grijalva and Bishop!)

Environmental investors fund fuel reduction projects

Here’s how it works: Investors buy into the bond, and the money is drawn as needed for forest restoration work. This includes thinning, strategic backfires and other rehabilitation. In this first case, it was a $4 million bond with money from CSAA Insurance, Maryland-based investment firm Calvert Impact Capital, The Rockefeller Foundation, and the Gordon and Betty Moore Foundation.

The investors are paid back over five years, with 4% interest, by those who benefit from the work and have contracted with Blue Forest, like the U.S. Forest Service and state agencies. In this case, payments will come from the Yuba Water Agency, whose reservoirs receive water from the forest and the California Department of Forestry and Fire Protection.

And the bond couldn’t come at a better time in the investor community, as an increasingly popular trend of socially conscious investing is taking off. It’s called ESG, which stands for environmental, social and corporate governance. It focuses on investing for the greater good; in this case, buying into the health of the forest but still making money.

It is exactly the kind of investment Jennifer Pryce, CEO of Calvert Impact Capital, says her clients want.

“Our investors are looking for an impact and a financial return, and this is off the charts when you look at what it’s giving back,” said Pryce, who polls investors each year to see how they want to align their capital with their values. “Fighting climate change is No. 1.”

She admits this one was a difficult sell because it is designed to prevent fires, rather than fight them. Still, once the possibilities and savings were made clear, the investors were in.

It’s not exactly “fighting climate change” either.  I wonder what else might get lost in translation, and would the “environmental” investors necessarily like the “other rehabilitation” that the Forest Service decides to fund with their money, and whether there are any restrictions on what an agency could use the funds for.  An interesting concept though …

The effects (NEPA) of bake-sale (timber-sale) funding of restoration

I  said here: “NEPA documents have started saying that cutting down trees is beneficial for the environment because it produces funding to replace culverts and the like. That may not be a defensible effects analysis.”

Sharon asked: “I don’t see why people need to say that at all in NEPA docs. Do you have examples?”

I do.  I’ll provide two here that I have encountered with forest plan revisions.

The Flathead revision FEIS provided very little useful information about aquatic effects, but it revealed this as part of their logic (p. 131, but their point seems to be that it doesn’t matter):

Although alternative D proposes more timber harvest and the potential to generate more Knutsen-Vandenberg revenue for restoration actions such as best management practices, road decommissioning, and culvert replacements that would benefit aquatics, it is anticipated that money would still be available from partnerships and appropriated watershed dollars to implement restoration projects regardless of how much money is generated from timber sales.

The Helena-Lewis and Clark was more to the point that it DOES matter in their revision DEIS (p. 71):

Alternative E would result in the highest volume of timber production and therefore have the potential to generate more money from timber receipts for restoration projects for watershed and fisheries. If more money is available from alternative E then there would be more short-term impacts from restoration projects but there would be more long-term gains

I think I have seen other better examples for projects that have stated that the proposed action is better for the environment than no action because the timber sale revenues will be used for restoration activities.  Maybe I’ll run across more examples, but I wanted to post this now so that others could contribute examples they are aware of.

So no, I don’t think they should include this in NEPA documents.  The problem is that effects disclosed in an EIS must be reasonably foreseeable.  If the funding process works in a way that makes money available but does not commit it to a specific use, then any effects are not reasonably foreseeable.  This is more obvious in the forest planning context because restoration is only a “potential” (to quote both examples above).  The result of including this kind of poorly substantiated assumption in an effects analysis is to distort the comparison of alternatives and to provide less meaningful information for the decision-maker and the public.  This tends to subvert the core purpose of NEPA.

What’s In the 2018 Budget for the Forest Service?

I was hoping that since some Appropriations Bill has been passed, that our friendly “people who are paid to analyze things” would share with us what was in this bill for the Forest Service. As helpful readers have pointed out, all I could easily get was the President’s budget, not what ultimately passed. I see that it’s been assailed as a “budget-buster” but that’s not necessarily for the topics we’re interested in. Links to what’s in the bill would also be appreciated.

Good Neighbor Authority

This isn’t something that has been discussed here, but in the last couple of days I’ve seen two stories that make it sound like the greatest thing since tab tops.

The Chequamegon-Nicolet National Forest may sell 123 million board feet of timber by the end of fiscal 2017, WJFW-TV reported. That would mark the fifth annual increase in a row for the forest, which is nearing its maximum yield.  Forest Supervisor Paul Strong said this year’s expected yield is “absolutely great news.” The forest’s management plan aims to sell 131 million board feet annually. Strong said the timber program has grown thanks to the National Forest Services’ increased authority under the 2014 U.S. Farm Bill and policies allowing organizations to remove small trees and keep the timber.  He also cited the federal Good Neighbor Authority policy, which has allowed the Wisconsin Department of Natural Resources to manage the sale of about 25 million board feet of timber in the national forest annually.

Idaho has been seeing success with using the “Good Neighbor Authority” it was granted under the 2014 federal Farm Bill to partner with the U.S. Forest Service and increase active management and timber harvests on national forests in the state – and it’s poised to ramp the program up.  Under GNA, the state Department of Lands can offer its expertise and help to the Forest Service where the service’s staffing is short, for everything from administering contracts for timber sales to jointly designing projects that are backed by local collaboratives.   Because Idaho had numerous forest collaboratives already in place – which bring together sportsmen, conservationists, industry, local government and more to help design projects to improve forests in their area – it was able to spring into action.  Schultz said the piece Idaho’s been able to include that earlier states didn’t is actual timber sales – which add the jobs and economic impact piece, along with fund the program itself.  Jonathan Oppenheimer, government relations director for the Idaho Conservation League, attended the Land Board meeting. “We’ve been involved in a lot of these collaboratives,” he said afterward. “We are cautiously supportive of the program. We see it as a good way to get work done.” He called GNA “a good tool, but one that we’re certainly watching closely.”

Here’s what the Forest Service says about it:

The Good Neighbor Authority allows the Forest Service to enter into cooperative agreements or contracts with States and Puerto Rico to allow the States to perform watershed restoration and forest management services on National Forest System (NFS) lands. Congress passed two laws expanding Good Neighbor Authority (GNA): the FY 2014 Appropriations Act and the 2014 Farm Bill. Each law contains slightly different versions.

  • The Farm Bill permanently authorizes the Good Neighbor Authority for both the Forest Service and the Bureau of Land Management (BLM) extending it to all 50 States and Puerto Rico. It excludes construction, reconstruction, repair, or restoration of paved or permanent roads or parking areas and construction, alteration, repair, or replacement of public buildings or works; as well as projects in wilderness areas, wilderness study areas, and lands where removal of vegetation is prohibited or restricted.

  • The Fiscal Year (FY) 2014 Appropriations Act included a five-year authorization for the use of GNA in all states with NFS lands to perform watershed restoration and protection services on NFS and BLM lands when similar and complementary services are performed by the state on adjacent state or private lands. Other than the adjacency requirement, there were no exclusions as to type or location of work.

Is there more here than meets the eye (good or bad)?  It does help with the financing.  Focusing on national forest lands that are “adjacent” to state or private lands seems like it would minimize controversy.  No mention of a collaboration requirement, but that seems to figure into it somehow.  If this is working so well, does the FS need more legislation?