Stewardship Contracting and the USDA Forest Service

Stewardship contract is a relatively new authority in the “toolkit” of restoration and community forestry. After several years of implementation, perspectives vary about its successes and challenges. It was officially authorized by Congress in 2003-04 following five years of pilot testing of the concept. For some, this authority creates innovative opportunity for gaining access to timber on national forest land, as well as a new method and incentive to improve the relationship communities have with forests.

The Forest Service and BLM historically have contracted for services, such as road maintenance and forest thinning. They also contract to sell forest resources such as timber or firewood. Traditionally, these contracts have been carried out separately—service contracts have generally been funded from the agencies’ budget, while timber was sold through private purchasers. The Omnibus Consolidated and Emergency Supplemental Appropriations Act of 1999 authorized the Forest Service to combine these contracting mechanisms by entering into “stewardship end results contracts.” This allows the agency to use the value of forest products sold to offset the cost of contracted services. Under such “goods-for-services” contracts, the Forest Service may pay for thinning operations by using the proceeds from any commercial timber removed as part of the project (GAO 1999). The full list of authorities follows:

• Goods for services allows the agency to use the value of commercial products, such as timber, to offset the cost of services received, such as thinning, stream improvement, and other activities.
• Designation by description or prescription allows the agency to conduct a timber harvest by providing the contractor with a description of the desired end result of the harvest. For example, the Forest Service might require that all ponderosa pine less than 10 inches in diameter be harvested. Ordinarily, cutting any standing tree before the Forest Service employee has marked or otherwise designated it for cutting is prohibited.
• Multiyear contracting allows the agency to enter into stewardship contracts of up to 10 years in length.
• Retention of receipts allows the agency to retain receipts generated from the sale of commercial products removed through stewardship (GAO 1999, p5).

It was reported during spring of 2004 that 68 of 77 Forest Service pilot projects were operating, generally focusing on removing vegetation. Forest Service staff reported that as of September 2003, nine pilot projects had been completed; i.e., all contracts associated with these projects were completed (GAO 2004, p9). About 13,800 acres had been treated and it was expected about 172,000 more would be treated.

The smallest project was 3.6 acres and the largest 20,000. The mean project size was 2,600 acres. Slightly more than half involved fewer than 1,000 acres, and about 10 percent exceeded 10,000 acres (GAO 2004, p19).
The cited GAO report says that many agency officials believe collaboration enhances project effectiveness and provides other benefits. Project managers cited a variety of benefits from community involvement, including improved project design and implementation, better lines of communication with the public, and enhanced public trust in the agencies. Several said they valued the project monitoring teams’ expertise and input, and some noted improvements to their project as a result of team and other community input (GAO 2004, p39).

As many involved people know, stewardship contracting is more than removing a percentage of large timber, or “saw logs,” to make it profitable enough to remove the less-valuable, more problematic small-diameter as a service to restoration objectives. It is also more than simply making a supply of timber available to private contractors as a tool to work towards those objectives and the economic objectives of businesses and rural communities. The contracting part, while being difficult to develop in ways that the Forest Service is comfortable with, is where many within the agency seem to feel most comfortable in developing. However, the “stewardship” component is the concept more difficult to innovate. The good thing is that there is a trend towards understanding how stewardship could be shaped, based primarily on the hands-on learning taking place through community-based efforts to evolve a new practice of stewardship of forests and communities.

Eight of the original 28 stewardship contracting pilot projects granted to the U.S. Forest Service (USFS) in 1999 are located throughout the Four Corners states. New contracting authorities that the USFS was asked to test include:

• The exchange of good for services
• The retention of receipts
• The awarding of contracts based on a “best value” basis
• The designation of timber for cutting by prescription or description
• Multi-year contracts

The expressed intent of the stewardship contracting pilot program was: 1) to help achieve land management goals on the national forests, and 2) to help meet the needs of local and rural communities. As such, communities and forest partnerships throughout the Four Corners have optimistically watched and often participated with the evolution of both the respective pilot projects and stewardship contracting program as a whole.