Financial Management Practices at the Flathead National Forest

An investigation was made of four allegations concerning certain financial management practices at Flathead National Forest in Hungry Horse, Montana. It was alleged that (1) the brush disposal fund supported personnel positions within the Forest Service which were not related to brush disposal; (2) the overhead assessment rate applied to direct brush disposal costs increased from 7 percent in 1960 to 45 percent in 1979; (3) the salaries of three employees in one of the Forest's districts were being incorrectly financed from general administration funds; and (4) the Forest's Supervisor's office retained 49 percent of the money it received to manage the Bob Marshall Wilderness.

Legislation provides that national forest timber purchasers may be required to deposit the estimated cost to the United States of disposing of brush and other debris resulting from their cutting operations in a special fund which is appropriated and remains available until expended. "Estimated cost" has been interpreted to mean all necessary costs, including costs of personnel and activities not directly related to specific programs or projects. No indication was found that the brush disposal program was being disproportionately assessed for its share of general administration expenses. A comparison of the actual forest level brush disposal overhead costs in 13 Northern Region forests between 1975 and 1978 showed that these costs at Flathead Forest were generally less than at other forests. Direct, exacting comparisons between 1966 data and current data were not practical, because the method of tracking overhead has been changed significantly since 1966. No evidence was found indicating that the salaries of the three employees were systematically or routinely being financed from general administration funds. Wilderness activities are funded as part of the total recreation program; funds are not specifically designated for the Bob Marshall Wilderness. Although it was not a question of wilderness funds being diverted to some unrelated purpose, it was true that 49 percent of the recreation monies received during fiscal year 1980 did not get down to the district level.