[Senate Hearing 106-785]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 106-785

                        THE U.S. FOREST SERVICE:
                  TAKING A CHAIN SAW TO SMALL BUSINESS

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                            OCTOBER 4, 2000
                                     

                                     

              Printed for the Committee on Small Business

                                 ______

                   U.S. GOVERNMENT PRINTING OFFICE
68-240                     WASHINGTON : 2001

_______________________________________________________________________
   For sale by the Superintendent of Documents, Congressional Office
         U.S. Government Printing Office, Washington, DC 20402


                      COMMITTEE ON SMALL BUSINESS

        .........................................................

                       ONE HUNDRED SIXTH CONGRESS

                              ----------                              

                CHRISTOPHER S. BOND, Missouri, Chairman
CONRAD BURNS, Montana                JOHN F. KERRY, Massachusetts
ROBERT F. BENNETT, Utah              CARL LEVIN, Michigan
OLYMPIA J. SNOWE, Maine              TOM HARKIN, Iowa
MICHAEL ENZI, Wyoming                JOSEPH I. LIEBERMAN, Connecticut
PETER G. FITZGERALD, Illinois        PAUL D. WELLSTONE, Minnesota
MIKE CRAPO, Idaho                    MAX CLELAND, Georgia
GEORGE V. VOINOVICH, Ohio            MARY LANDRIEU, Louisiana
SPENCER ABRAHAM, Michigan            JOHN EDWARDS, North Carolina
VACANCY
                     Emilia DiSanto, Staff Director
                      Paul Cooksey, Chief Counsel
    Patricia R. Forbes, Democratic Staff Director and Chief Counsel


                            C O N T E N T S

                              ----------                              

                           Opening Statements

                                                                   Page

Enzi, The Honorable Michael B., a United States Senator from 
  Wyoming........................................................     1
Crapo, The Honorable Michael D., a United States Senator from 
  Idaho..........................................................     9
Burns, The Honorable Conrad, a United States Senator from Montana    20

                           Witness Testimony

Thomas, The Honorable Craig, a United States Senator from Wyoming    24
Craig, The Honorable Larry, a United States Senator from Idaho...    26
Hurst, Jim, President, Owens & Hurst Lumber, Co., Inc., Eureka, 
  Montana........................................................    28
Bousman, Joel E., Cattle Rancher, Boulder, Wyoming, and Regional 
  Vice President, Wyoming Stockgrowers Association, Casper, 
  Wyoming........................................................    36
Tinsley, Del, Owner/Publisher, Wyoming Livestock Roundup, Casper, 
  Wyoming, and Member, Advisory Board, University of Wyoming 
  College of Agriculture, Laramie, Wyoming.......................    48
Bukowsky, Al, Owner/Operator, Solitude River Trips, Salmon, Idaho   159
Van Tassell, Larry W., Professor and Head, Department of 
  Agricultural Economics and Rural Sociology, University of 
  Idaho, Moscow, Idaho...........................................   182
McKillop, William, Professor Emeritus, College of Natural 
  Resources, University of California-Berkeley, Berkeley, 
  California.....................................................   190
Furnish, James R., Deputy Chief, National Forest System, Forest 
  Service, U.S. Department of Agriculture, Washington, D.C.......   201

          Alphabetical Listing and Appendix Material Submitted

Bousman, Joel E.
    Testimony....................................................    36
    Prepared statement...........................................    38
Bukowsky, Al
    Testimony....................................................   159
    Prepared statement...........................................   165
Burns, The Honorable Conrad
    Opening statement............................................    20
    Prepared statement...........................................    22
Craig, The Honorable Larry
    Testimony....................................................    26
Crapo, The Honorable Michael D.
    Opening statement............................................     9
    Prepared statement and attachment............................    11
    Post-hearing questions posed to Mr. Furnish..................   212
Enzi, The Honorable Michael B.
    Opening statement............................................     1
    Prepared statement...........................................     4
    Post-hearing questions posed to Mr. Dombeck..................   210
Furnish, James R.
    Testimony....................................................   201
    Prepared statement...........................................   203
Hurst, Jim
    Testimony....................................................     8
    Subsequent submission for the record.........................    35
McKillop, William
    Testimony....................................................   190
    Prepared statement...........................................   197
Thomas, The Honorable Craig
    Testimony....................................................    24
Tinsley, Del
    Testimony....................................................    48
    Prepared statement and attachment............................    54
Van Tassell, Larry W.
    Testimony....................................................   182
    Prepared statement...........................................   185

                        Comments for the Record

Cook, Adena, Public Lands Director, Blue Ribbon Coalition Inc., 
  Idaho Falls, Idaho, letter.....................................   216
Eaton, The Honorable Craig D., Mayor, Town of Eureka, Montana, 
  letter.........................................................   220
Finch, Wayne, Rexford, Montana, letter...........................   222
Johnson, Shirley May, Fortine, Montana, letter...................   224
Kvenild, J.R., Broker, Western Land Service, Casper, Wyoming, 
  letter.........................................................   229
Marvel, The Honorable Bill F., Mayor, Town of Rexford, Montana, 
  letter.........................................................   230
Panek, Jerry, Owner, Predator 4WD, LLC, Colorado Springs, 
  Colorado, statement............................................   231
Radish, Danny, Eureka, Montana, letter...........................   236
Thoman, Mary E., Thoman Ranch--Southwestern Wyoming Ranchers, 
  Kemmerer, Wyoming, statement...................................   237
Safari Club International, Herndon, Virginia, statement..........   238
Taylor, David T., and Roger H. Coupal, Cooperative Extension 
  Service, College of Agriculture, Department of Agricultural and 
  Applied Economics, University of Wyoming, Laramie, Wyoming, 
  statement and attachment.......................................   242
West, Rosetta, Eureka, Montana, letter...........................   250

 
                       THE U.S. FOREST SERVICE: 
                  TAKING A CHAIN SAW TO SMALL BUSINESS

                              ----------                              


                       WEDNESDAY, OCTOBER 4, 2000

                              United States Senate,
                               Committee on Small Business,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 9:35 a.m., in 
room SR-428A, Russell Senate Office Building, the Honorable 
Michael Enzi presiding.
    Present: Senators Burns, Enzi, and Crapo.

 OPENING STATEMENT OF THE HONORABLE MICHAEL B. ENZI, A UNITED 
                  STATES SENATOR FROM WYOMING

    Senator Enzi. I will call to order this meeting of the 
United States Senate Committee on Small Business. The topic 
today is the U.S. Forest Service: Taking a Chain Saw to Small 
Business. I would like to thank Chairman Bond and his staff for 
their tremendous help in making this hearing possible. Through 
his Committee's leadership we hopefully will be able to shed 
new light on the workings of the U.S. Forest Service and will 
be able to begin the necessary steps to increase the agency's 
accountability to American small businesses.
    I am looking forward to hearing what the participants will 
have to say today. I feel they have important stories that for 
far too long have been pushed aside in the rush by many 
national organizations to dominate public policy on Federal 
Public Lands.
    As a former small business owner myself, I can personally 
attest to the huge impact the Forest Service can have on the 
economies of Wyoming and on other western communities--on our 
homes, our schools, the communities that are built in and 
around the forest. Our income often depends on being able to 
access these lands in order to harvest trees, minerals, natural 
gas, and other important resources. We use the forests to heat 
our homes, to graze our sheep and cattle, and for visitors.
    At the same time, one of our Nation's best resources for 
restoring forest health, the private small business sector, has 
been effectively shut out and denied access to their own public 
lands. Over the last decade Federal timber harvests nationwide 
have decreased by 75 percent.
    Now I hear the statistics about how much money comes in 
from recreation and how much less the money is that comes in 
from timber. We used to do both of those. We used to get the 
revenue from both of those, but there has been a 75-percent 
decrease in one of them. Because most of the larger, more 
successful forest products companies rely on their own private 
source of timber, the decrease in timber sales has directly 
impacted small, family-owned and operated companies. And while 
this important source of timber has consistently dwindled, the 
demand for wood in the United States has continued to increase.
    The near elimination of Federal timber harvest in the West 
has created a void in the market that has been filled by two 
main sources: timber harvested on private lands in the 
Southeast United States and lumber imported from Canada and 
other foreign countries. We are probably eliminating some 
important animals in other countries.
    As a result of this trend, private landowners in the 
Southeast are now overharvesting in order to meet the current 
demand for wood products, and imports from Canada now exceed 35 
percent of our domestic lumber supply. Once again it is the 
small logging, hauling and sawing companies that have not been 
able to involve themselves in these new market sources.
    The same effect can be felt in other industries as the 
Forest Service continues to substitute paperwork for land 
management. Ranchers who lose vital grazing leases find 
themselves with no remaining recourse but to subdivide and sell 
their third-generation ranches to developers so that urban 
sprawl has taken the place of elk and antelope.
    Other witnesses will discuss the impact on recreation and 
how the Forest Service is shutting down outfitters and guides. 
We will even hear how this agency has impacted the publishing 
industry by forcing the price of paper to jump dramatically in 
just the past year.
    Could all of these threats have been avoided? No. There are 
always risks in any business, but while most businesses have 
control over at least some of the elements of their success or 
failure, those small businesses that are forced to work with 
the U.S. Forest Service too often have found themselves on the 
outside of any planning process that could affect their future.
    One prime example that I believe demonstrates the Forest 
Service's serious neglect of small business involvement can be 
found in the way the agency has painfully avoided complying 
with the Regulatory Flexibility Act, or RFA, in the development 
of its Proposed National Forest System Land and Resources 
Management Plan, the Forest Transportation System 
Administration, and in Roadless Area Conservation regulations.
    Over the past several years the General Accounting Office 
and the Forest Service have worked to assess the Forest 
Service's inefficiencies and lack of accountability as it 
manages our National Forests. Together, these agencies have 
identified a weak decisionmaking process and failure by the 
Forest Service to develop the strategic long-term goals.
    One would think that an agency, struggling like the Forest 
Service is to develop an adequate planning process and to 
increase its accountability and performance, would embrace a 
statute like the Regulatory Flexibility Act. The RFA clearly 
lays out an analytical process for determining how to best 
achieve public policy objectives without unduly burdening small 
businesses.
    The Forest Service, however, has gone out of its way and 
has performed all sorts of regulatory gymnastics to keep small 
businesses out of its decisionmaking process. I believe the 
Forest Service has attempted to twist the law and to abdicate 
its responsibilities under RFA by dividing or bifurcating its 
rulemaking process so that its rules fall within two allowable 
exceptions to completing a Regulatory Flexibility Analysis.
    It was not the intention of Congress to allow Federal 
agencies to use bureaucratic rulemaking equivocation to 
circumvent its duties to small business. When Congress 
established the RFA, it did so with the goal that small 
businesses have a voice in the rulemaking process so that those 
who could least afford the layer upon layer of regulatory 
burdens could help find a less onerous method of accomplishing 
the agency's goals.
    I will not place all of the blame for this situation on 
this agency, but must state that if the agency is operating 
within its legal bounds to twist the process so that it can 
ignore its small business constituents, then I believe Congress 
should step forward to amend the RFA to close any loophole that 
may exist. It was not our intention for the Forest Service to 
be unaccountable and we must ensure that this situation is 
corrected.
    I would argue, however, that the U.S. Forest Service is 
accountable and that the agency is failing in its statutory 
duties under the RFA to consult with small businesses in the 
development of its rules and regulations, and that the Forest 
Service has failed to further comply with the statute by 
failing to develop less onerous alternatives that do not 
sacrifice economic stability. You may be assured I will 
investigate this issue further.
    In closing, I must state that I do not believe a healthy 
forest and a healthy economy are mutually exclusive. In fact, I 
would go so far as to say that healthy forests and healthy 
economies are interdependent and that without a strong local 
economy, the U.S. Forest Service will find itself unable to 
meet the demands that will be placed on the agency in the next 
century.
    [The prepared statement of Senator Enzi follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.001
    
    [GRAPHIC] [TIFF OMITTED] T8240.002
    
    [GRAPHIC] [TIFF OMITTED] T8240.003
    
    [GRAPHIC] [TIFF OMITTED] T8240.004
    
    [GRAPHIC] [TIFF OMITTED] T8240.005
    
    Senator Enzi. I defer to Senator Crapo.

 OPENING STATEMENT OF THE HONORABLE MICHAEL D. CRAPO, A UNITED 
                   STATES SENATOR FROM IDAHO

    Senator Crapo. Thank you very much, Chairman Enzi, and I 
have a full statement which I will submit for the record and I 
will try to make my remarks brief.
    I thank the Small Business Committee and Chairman Bond for 
allowing this important issue to be addressed before this 
Committee. It may be unusual for many people to see the Small 
Business Committee examining forest policies but as you will 
see today, there is a very direct impact and a critical issue 
that is now very evident.
    We know that, in the past, the Forest Service policies have 
had a negative impact on small businesses throughout the 
Nation. It is my hope that, through efforts such as this 
hearing and others, the Forest Service can be made accountable 
for fulfilling its mission while allowing interested 
stakeholders to effectively participate in the policymaking 
process.
    In Idaho we have more than 20-million acres of National 
Forest land, which is 10 percent of the National Forest System. 
Everytime that the Forest Service issues and carries out a 
proposal, businesses in Idaho will be affected. There is no way 
around that.
    But what we can strive for is a process whereby the Forest 
Service actively engages those people who are affected by its 
land 
management policies in order to foster active environmental 
stewardship of our public lands and resources without harming 
the economy.
    Today that type of cooperation between the Forest Service 
and the small businesses is absent. As stated in the Small 
Business Administration's Office of Advocacy statement on July 
17, 2000, to the Forest Service which, Mr. Chairman, I would 
like to submit for the record:

    The public has an interest in knowing the potential 
economic impact of a particular proposed regulation. . . . 
Providing the public with a complete economic analysis that 
fully discloses the potential impact of the action and 
considers less burdensome alternatives not only complies with 
the requirements of the RFA, it also complies with the basic 
tenets of sound public policy that balance conflicting 
interests.

    The Federal Regulatory Flexibility Act, the RFA, of 1980 
which was later strengthened by the passage of the Small 
Business Regulatory Enforcement Fairness Act of 1996, directs 
government agencies to conduct a series of analyses describing 
the impact of a 
proposed rule if it will have a significant economic impact on 
a substantial number of small entities.
    As a result, agencies must determine whether a rule is 
expected to have a significant economic impact on small 
businesses. It is apparent that the Forest Service has 
repeatedly acted in a manner that contradicts the law of the 
land. It has failed to adequately and accurately account for 
the direct or indirect financial or other effects that a 
proposed action would have on small businesses.
    For example, on May 10, 2000, the Forest Service published 
a proposed rule on Roadless Area Conservation. Unbelievably, 
the Forest Service has argued that this proposed rulemaking 
would not have a significant economic impact on a substantial 
number of small businesses and therefore that it is not 
required to comply with the requirements of the Small Business 
Regulatory Enforcement Fairness Act.
    Again citing the Office of Advocacy's letter to the Forest 
Service, ``case law and the facts support a finding that the 
impact of the proposal is indeed direct, not indirect,'' as the 
Forest Service argued. Therefore, the RFA necessitates total 
compliance by the Forest Service.
    In this example, the Forest Service's Initial Regulatory 
Flexibility Analysis did not adequately address the issue of 
economic impact. A full, detailed economic analysis of the 
impact of the Forest Service's policies should be completed 
prior to the finalizing of any such proposals.
    This roadless proposal reaches far and wide, but other 
policies pursued by the Forest Service challenge the resolve of 
small businesses on a daily basis. Among many others, the 
recreation, timber, logging, ranching and mining industries 
have been imposed upon with the onerous burden of defending 
themselves against these rules.
    From national policies such as the roadless rule, draft 
transportation plan, strategic plan, and the cost recovery 
rule, to regional and local plans, the Forest Service is 
showing a disregard for the impact of its policies on small 
businesses. The Federal Government has an obligation to ensure 
that its policies will not have an unwarranted effect on 
individuals. The Forest Service is not meeting that obligation.
    Although the Forest Service may contend that many of its 
policies are a result of other environmental laws like the 
Endangered Species Act or the Clean Water Act, I disagree. 
Closing access may be the easiest way to comply with outside 
factors, but it is not the right way to do it. It may take more 
effort but the Forest Service should and can work together with 
interested parties to address both environmental and economic 
concerns.
    I want to thank the witnesses for your participation in 
this hearing and look forward to your testimony. Your input 
based on your personal experiences will be particularly helpful 
as we further investigate this issue.
    I also want to thank Senator Craig and Senator Thomas for 
their participation in this hearing. As chairman of Senate 
Subcommittees, which have jurisdiction over these issues, I 
look forward to their insight on these issues. Thank you, Mr. 
Chairman.
    [The prepared statement and attachment of Senator Crapo 
follow:]

[GRAPHIC] [TIFF OMITTED] T8240.006

[GRAPHIC] [TIFF OMITTED] T8240.007

[GRAPHIC] [TIFF OMITTED] T8240.008

[GRAPHIC] [TIFF OMITTED] T8240.009

[GRAPHIC] [TIFF OMITTED] T8240.010

[GRAPHIC] [TIFF OMITTED] T8240.011

[GRAPHIC] [TIFF OMITTED] T8240.012

[GRAPHIC] [TIFF OMITTED] T8240.013

[GRAPHIC] [TIFF OMITTED] T8240.014

    Senator Enzi. Senator Burns.

   OPENING STATEMENT OF THE HONORABLE CONRAD BURNS, A UNITED 
                  STATES SENATOR FROM MONTANA

    Senator Burns. Thank you very much, Mr. Chairman. I want to 
thank Senator Thomas and Senator Craig for coming this morning. 
We sit together on the Energy and Natural Resource Committee 
and of course our dialog with the Forest Service is ongoing 
about every time we have a Committee hearing.
    Just to give you an idea on how the relationship between 
Congress and the Forest Service and also the local people that 
live in communities in and around our National Forests has 
deteriorated, yesterday in Interior Appropriations we 
eliminated the funds for the second time for the assistant 
secretary of agriculture that is in charge of the Forest 
Service, and for good reason. It is just an indication of the 
erosion in the communications between the Forest Service that 
is here in this town and the foresters on the ground in our 
different communities.
    I believe it is vitally important that we focus 
specifically on how these policies that are set by the Forest 
Service are hurting our businesses in and around our forests.
    Whenever there is a change proposed for the use of public 
land, we always have to do an EIS, an environmental impact 
statement. Well, we can turn environmental into economic and 
that is going to have to be done, too, in order to give an 
overall view of the effects these decisions have on this 
country.
    People are being put out of work and today we are going to 
see real people with real faces that have real concerns about 
their businesses and the people who work in those businesses.
    We are small businesses in Montana. Ninety-nine percent of 
our businesses in Montana are 100 employees or less. So we know 
what it is like. New rules have reduced the amount of timber 
harvested from our public lands by over 90 percent in the last 
10 years. New rules have blocked new roads from being built. 
New rules have reduced grazing allotments on public lands. The 
current rules have punished our outfitters and guides and left 
them with virtually no economic stability.
    I want to give you an example and it is sitting right here. 
This is from a tree that lies 50 feet off the road. It is dead. 
It died of pine bark beetle and there are thousands and 
thousands of board feet available within a rope's throw of a 
road that can be harvested to keep our mills alive and lumber 
flowing for our consumers.
    There have been no plans, none at all, no effort made by 
the Forest Service in order to deal with this situation. And 
this log, this piece, comes from just a few miles from where 
American Timber shut down their mill this last year. It went 
out of business early this year and now we have another mill 
that is not very far away from it that is cutting back on their 
employees.
    This is letting a natural resource just go to waste. Not 
only do we not have access to the resource but also our 
infrastructure and the base of employees has also eroded and 
pretty soon those folks will be gone.
    So I will submit my full statement, Mr. Chairman. I am glad 
that Jim Hurst is here today from up in Eureka country. I 
promised him one thing, that we would have him out of here so 
he would be home to watch his son play football on Friday 
night, and we are going to do that.
    I thank you for having this hearing and my congratulations 
to Senator Bond for facilitating it.
    [The prepared statement of Senator Burns follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.015
    
    [GRAPHIC] [TIFF OMITTED] T8240.016
    
    Senator Crapo. So this hearing is going to go till Friday 
afternoon?
    Senator Burns. Yes, we are going to be here until we get it 
all ironed out. Did you bring a lunch?
    Senator Enzi. I want to thank everybody who is 
participating today. I particularly want to thank this first 
panel, our distinguished colleagues from the committee of 
jurisdiction. We are handling a very small part of the issue, 
the small business issue. Of course, in each of your States 
small businesses actually, by Federal definition, would 
probably be about 98 percent of the businesses, so it is not 
that small a part of the economy. We have a lot of discussions 
in this Committee here about what small business is and 500 
employees seems pretty big to us in Wyoming.
    It is my pleasure to welcome the Senior Senator from 
Wyoming, Senator Thomas, and the Senior Senator from Idaho, 
Senator Craig. Senator Thomas, would you like to begin?

   STATEMENT OF THE HONORABLE CRAIG THOMAS, A UNITED STATES 
                      SENATOR FROM WYOMING

    Senator Thomas. All right, Mr. Chairman. Thank you.
    First of all, I want to thank you for having this hearing. 
I appreciate it very much. All of us are concerned, of course, 
about these issues and the impacts that Forest Service policy 
has on small business and indeed on all we do in our States.
    Both Senator Enzi and Senator Craig and I were in Billings, 
Montana, with Senator Burns recently and heard these kinds of 
things very directly as they related to the fire damages, and 
so on, so I think it is great to do this.
    Obviously all of us are concerned about this issue. The 
preservation of the resource is, of course, very high on all of 
our agendas. I grew up right outside the Shoshone National 
Forest in Cody, Wyoming, and I am very glad the forest is there 
and I want to work to protect it the best that I can. Certainly 
the first purpose is to do that but the second is to allow the 
owners of that forest to participate in it, to enjoy it, to 
have access to it, and I think that is really what we are 
talking about here.
    This administration has moved steadily toward cutting off 
access. Whether it is the EPA, whether it is the White House 
Council on Environmental Quality, whether it is the Department 
of the Interior, whether in this case it is the Department of 
Agriculture, I think clearly there has been an overt movement 
to reduce access to these lands.
    All of us here this morning, of course, understand the 
importance of public land access. In our State 50 percent of 
the State belongs to the Federal Government. It is higher than 
that in some of your States. So it has a great deal of impact 
on all of us and what we do and on our economy, of course.
    We recognize that these lands are in different Federal 
ownership categories. I happen to be chairman of the National 
Parks Subcommittee. Park lands are operated differently. We 
have wilderness areas that are operated differently. But the 
point I want to make is that many national forest lands are 
multiple use lands and that is what they were designed to be 
and indeed can be if they, I think, if they are managed 
properly. I am talking about hunting, hiking, visiting.
    You know, it was interesting when the roadless proposal 
came up, the kinds of people that you heard from. You would 
think first of all it might be those who had direct economic 
interest, and so on. Not so. For example, we had veterans 
associations concerned about how people with handicaps were 
going to be able to visit their forests and those kinds of 
things. So I think the impact is very broad and it is very 
important to consider how best to manage these resources.
    I think the policies from the Forest Service certainly need 
some review. We have sought to do that. Since 1998 the agency 
has proposed a number of management regulatory changes. Just to 
name a few, the National Forest System Road Management and 
Transportation System Policy--that is all one title. Forest 
planning regulations, roadless area reviews, Strategic Plan for 
Government Performance and Results Act, final interim rule on 
roadless areas, fuel reduction policy, draft environmental 
impact statement for Interior Columbia Basin, ecosystem 
management project, cost recovery for special use applications, 
unified Federal policy for insuring a watershed approach to 
Federal lands, to name a few. And I think one of the 
difficulties is that these have not always been related to one 
another and worked in a cooperative kind of way but have sort 
of been thrown out there.
    I was particularly, I guess, impressed and negatively 
impressed with the roadless proposal. This policy came from 
Washington in kind of an announcement to apply to all lands. At 
the same time, each of the forests has their own forest study, 
which they do periodically for their own forest plan, which 
would have been the logical way to take a look at roadless 
areas but, instead, that was declared from here. We went to the 
meetings. I went to some of the meetings that people were 
interested in. There were really no detail available to the 
people who came to a so-called hearing and they had no chance 
to really react.
    So these are the kinds of things that I think ought to be 
changed. I believe these policies have been largely implemented 
and run by the assistant secretary over in the Department of 
Agriculture--not by the professional foresters--and that is too 
bad. Small businesses are involved, of course, in recreation, 
in tourism, in guiding and hunting and ranching and forestry, 
mineral exploration, all these kinds of things, which are very 
important to our economy.
    So Mr. Chairman, I do think all of us need to take a look 
at how we can better implement Forest Service policies, how we 
can take some of the regulatory burden off small business, how 
we can provide more access to these public lands for the 
various kinds of uses and, at the same time, protect the 
resources.
    I appreciate what you are doing and thank you for the 
opportunity to be here.
    Senator Enzi. Thank you.
    Senator Craig.

STATEMENT OF THE HONORABLE LARRY CRAIG, A UNITED STATES SENATOR 
                           FROM IDAHO

    Senator Craig. Chairman Enzi, thank you very much. Let me 
also thank Senator Crapo and Senator Burns.
    I also want to commend Chairman Bond for allowing the Small 
Business Committee to hold these hearings on the role of the 
U.S. Forest Service in dealing with small business. I am 
especially pleased to be joined here at the table this morning 
with Senator Craig Thomas, who has played an active role with 
me, as has Senator Burns, on a variety of committees that have 
jurisdiction over the U.S. Forest Service.
    Since 1995, I have chaired the Subcommittee on Forest and 
Public Land Management of the Committee on Energy and Natural 
Resources, Mr. Chairman. That Subcommittee has primary 
jurisdiction over the programs and operations of the U.S. 
Forest Service. During the 104th Congress and in the current 
Congress, I also chair the Subcommittee on Forestry, 
Conservation, and Rural Revitalization of the Committee on 
Agriculture, Nutrition, and Forestry. So I have had the 
opportunity, as chairman of those two Subcommittees, to look at 
the broad jurisdiction and also the narrow focus that we have 
given to the U.S. Forest Service.
    During those chairmanships I and many of you have joined 
with me, have held over 100 oversight hearings on the programs 
and polices of the U.S. Forest Service. As it relates to the 
interests of this Committee and the subject of this hearing, 
our oversight record suggests two fundamental conclusions.
    First, the U.S. Forest Service is likely the single most 
important agency affecting small businesses in the rural areas 
of my State and all of your States and most of the western 
States of the United States. The Forest Service's programs and 
policies essentially determine the success or failure of 
logging, road maintenance and other land management service 
contractors. The Forest Service basically controls the 
marketplace for recreation outfitters, hunting and fishing 
guides, visitor concessionaires and resort owners dependent 
upon the use of the national forests. The economic health of 
small service establishments in public lands dependent 
communities is inextricably tied to the national forests and 
the surrounding area.
    In short, while other Federal agencies like the Small 
Business Administration have programs to help these businesses, 
the Forest Service determines the future of these businesses.
    My second conclusion is that there is not an agency in the 
Federal Government that is less sensitive to the needs of small 
business. The Forest Service operates in a milieu of constant 
conflict among powerful, national interest groups over resource 
management direction and priorities. Small business entities 
are poorly organized, diverse in their views, and generally are 
ignored in the ongoing debate.
    Worse, the Forest Service has moved actively to minimize 
and, in some cases, even eliminate the limited opportunities 
and considerations that other Federal agencies routinely afford 
small business interests to access and influence their 
programs.
    For example, the agency has taken the position that its 
land and resource management plans are not agency rules subject 
to the requirements of the Small Business Regulatory 
Enforcement Fairness Act. The Forest Service persists with this 
unlawful and exclusionary position notwithstanding clear case 
law to the contrary. Clearly, the agency is of the view that it 
is up to small business to petition the court to force the 
Forest Service to meet its obligations under the law.
    Further, to say that the Small Business Impact and 
Regulatory Flexibility Act analyses accompanying Forest Service 
rulemakings are cursory would be to award the agency an 
unintended compliment. These analyses are typically 
nonexistent. I have not reviewed a single Forest Service rule 
over the past 5 years which contained an analysis of this sort 
which could withstand judicial scrutiny. But here again, the 
agency is depending on the limited means of small business to 
seek judicial intervention to correct a constant pattern of 
lawlessness.
    Any reasonable effort to complete these analyses would 
easily highlight problems created for small business. For 
example, in the case of recreational outfitters, the Forest 
Service has regulations which severely constrain the ability of 
these small businesses to operate in a reasonable business 
environment. Many visitors to the public lands would not be 
able to enjoy them without the assistance of outfitters and 
guides. The outfitters who provide important guide services to 
visitors to our National Forests are required to have a permit 
and to pay a share of their revenues to the Federal Government. 
But these small businesses are not offered permits on a 
reasonable, long-term basis. Rather, they must expend the time 
and energy to secure their permit on an annual basis, subject 
to revocation at any time. You can imagine the impact such 
regulations have on outfitters and guides when they try to get 
a loan to buy new equipment or to sell their small businesses.
    Perhaps most troubling have been the reports that, through 
programs like the Recreation Fee Demonstration Program, the 
Forest Service has attempted to supplant small businesses with 
government enterprises. The Recreation Fee Demonstration 
Program is a pilot effort which allows the Forest Service to 
charge recreation user fees for some sites and retain those 
fees for agency purposes. We have received a number of 
complaints from concessionaires that the Forest Service is 
using this authority to drive their businesses away from the 
most popular Forest Service recreational sites so that they can 
be managed for the agency's financial gain instead of the 
concessionaire or the local business person. As a result of 
these complaints, we have so far refused to make this fee 
collection authority permanent, pending further oversight.
    Lastly, unlike other Federal agencies--for instance, the 
Environmental Protection Agency--that manage large programs 
that impact small businesses, the Forest Service has neither 
appointed a small business liaison within the agency, nor 
assigned this responsibility to any office within the agency. 
Indeed, I believe your hearing will uncover evidence that there 
is very little sensitivity to, or understanding of, the needs 
of small businesses anywhere in the U.S. Forest Service.
    As one outcome of the hearing, I would like to work with 
this Committee to assure that we are successful in creating an 
independent Office of Small Business Advocacy within the Forest 
Service itself. That office should be given the opportunity and 
the responsibility to approve both Small Business Impact and 
Regulatory Flexibility Act analyses before any final regulation 
leaves that agency.
    Again, Mr. Chairman, those are my views based on the 
experience we have had in examining this agency upside down and 
inside out for the last good number of years. So I hope that 
once again your effort and this Committee's efforts will expose 
what some of us have known and what we hope the country can 
understand--an agency now that pays little attention to the 
responsibility it has had and has within the law to the small 
communities that surround it.
    It is tragic to me that somehow in the mix of what has 
happened over the last decade the word commercial value is of 
disdain on the lips of the U.S. Forest Service. But it is today 
and as a result of that the biases that I think are reflected 
in the actions they have taken are clearly anti-business, anti-
small business, and therefore anti-West and anti-rural America. 
Thank you very much, Mr. Chairman.
    Senator Enzi. Thank you very much. I thank each of you for 
your testimony this morning. I particularly thank you for the 
leadership that you demonstrate on this issue every day. I want 
to again thank you for taking time out of your busy day to 
testify and also your agreement to take the results from this 
hearing and use them for your work on this issue. Thank you 
very much.
    Now while the second panel is taking their place at the 
table I will do a brief introduction, but I have to mention 
that the three of us that are here today are in our home States 
almost every weekend traveling a different part of the State, 
talking to people that are actually dealing with the problems. 
This is a delightful panel because these are the people that we 
talk to when we are in our respective home States. They give us 
some good, common-sense ideas for things we can do; which we 
bring back here. The usual reaction is ``That is too simple; it 
will not work.'' But we manage to complicate them. We have some 
people here that will give some of those on-the-ground 
opinions.
    We have Jim Hurst, who is the president of Owens & Hurst 
Lumber Company of Eureka, Montana. We have Joel Bousman, who is 
a cattle rancher from Boulder, Wyoming, and the regional vice 
president of the Wyoming Stockgrowers Association. We have Del 
Tinsley, who is the owner and publisher of the Wyoming 
Livestock Roundup in Casper, Wyoming. Mr. Tinsley is also a 
member of the Advisory Board for the University of Wyoming 
College of Agriculture in Laramie, Wyoming. And we have Al 
Bukowsky, who is the owner/operator of Solitude River Trips in 
Salmon, Idaho.
    Mr. Hurst.

 STATEMENT OF JIM HURST, PRESIDENT, OWENS & HURST LUMBER CO., 
                     INC., EUREKA, MONTANA

    Mr. Hurst. Senators, thank you for inviting me. My name is 
Jim Hurst. I own and operate a small mill in Eureka, Montana, 
where I have been a life-long resident.
    To get directly to the point, the impact of current and 
proposed U.S. Forest Service policies and regulations are and 
will continue to be devastating to small timber-related 
companies and the rural communities where they are located 
unless changes are made soon.
    Please note that I speak not only for my company but for my 
employees and a significant number of the residents of Eureka 
and Lincoln County, Montana. We offer a dire picture of what 
the Forest Service is doing to small businesses and families in 
our community.
    Last Thursday I was forced to lay off approximately 60 
percent of my workforce. A copy of my lay-off notice stands 
before you.
    [The notice follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.017
    
    Mr. Hurst. The names not on this list represent 60 jobs in 
a small community where my firm was the largest employer. 
Forest Service policies in conjunction with the likes of NEPA, 
the Endangered Species Act, road obliteration mandates, etc., 
are primarily responsible. As these anti-harvest measures 
intensified, coupled with an onslaught of appeals by the 
environmental industry, our forest, the Kootenai, has sold only 
25 percent of historic levels. In short, Federal dictates are 
literally sucking the blood out of rural, timber-dependent 
communities in Montana.
    We are a small independent mill. Our adversaries are big 
government, big environmental organizations and big business, 
which present us with a bit of a challenge to merely stay in 
business. As I mentioned, harvest volumes from the forest have 
greatly decreased.
    My instincts tell me that the system works like this. The 
big environmental groups influence big government to promote a 
zero or reduced harvest. Big timber companies that have their 
own private forests do not intervene because closing the 
National Forests to timber removal increases the value of their 
own holdings. The result is the extermination of the small 
firms who have deep roots in their communities.
    An example of this is the closure of the American Timber 
Company. I attended its auction 2 weeks ago. That notice is 
here before you.
    [The notice follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.018
    
    Mr. Hurst. When that family-owned small business closed 
after 54 years, 145 people lost their jobs. The auction sold 
what was left for 2 cents on the dollar. Another independent 
company gone forever and for no good reason, as we have clean 
air, clean water, abundant wildlife and literally millions of 
acres of dead, down and disease-infected timber that needs 
treatment--a resource that could be processed into lumber for 
our Nation instead of providing citizens with the annual 
Montana firestorm event.
    Driving us out of business only enhances the opportunities 
for big business to buy what U.S. Forest Service timber is 
offered at bargain basement prices because of a lack of 
competition and would provide big government an opportunity to 
ride in on a white horse and offer to relocate us or retrain 
us. Problem is, many of us do not want to leave. Many will stay 
and live in poverty rather than leave their homes. I realize 
this may be a simplistic view but I believe it hits the mark.
    I have a Native American friend who, when referring to the 
Federal Government's treatment of rural Westerners, said, ``You 
are the new Indians. First they take away your land and your 
way of life. Then they say, `Trust us.' '' The fact is we do 
not trust our national government anymore and it is quite 
evident our government does not trust us.
    As far as we are concerned, the Federal Government has 
turned its back on rural resource-dependent communities. It 
ignores the locals who live, work, recreate in, care for and 
understand our 
forests. Instead, the ``Wizards of Washington'' know what is 
best for us. They allow massive build-ups of fuel in our 
forests, yet removing this fuel is currently not an option. 
Local, on-the-ground decisionmaking would not allow this to 
happen.
    Are Forest Service policies negatively affecting small 
business in rural communities? You be the judge. The Montana 
Hunger Coalition fact sheet states 14 percent of Lincoln County 
residents are living in poverty; 28 percent are poor and at 
risk for hunger. And that was before my lay-off.
    Statewide, since 1994, Montana has led all 50 States in the 
rate of increase in poverty. While poverty has been on the 
increase, the rate of unemployment has been low. This is 
ludicrous in a State with an abundance of natural resources and 
with a population willing to work.
    The report states that while Montanans are working harder 
than ever, they nevertheless lead the Nation in the rate of 
increase in poverty mainly because of a deterioration in wages 
in agriculture and the extractive industries and an increase in 
low-wage sector jobs.
    I have brought with me letters from the mayors of Rexford 
and Eureka, Montana, further describing the negative impact of 
Forest Service policies on their towns. I hope you will include 
these letters in the record of this hearing.
    In Eureka, Montana, the U.S. Forest Service has an 
opportunity to prove its worth. It can care for the land and 
serve the people by immediately selling the estimated 150-
million board feet of timber that have been burned within 15 
miles of our town. Harvest the trees while they have value and 
in the process, grind the limbs and tops into the ground to 
stabilize the soil and also stabilize our way of life for 
another 3 to 4 years. A momentary stay of execution until we 
can determine if sound science, reasonable decisions and common 
sense will once again be the trademark of the U.S. Forest 
Service. If no stay is forthcoming, I would personally prefer 
lethal injection.
    If nothing else, I would hope the Forest Service and the 
Federal Government would look at small business with the 
realization that some of their oversights and the intended and 
unintended consequences of their actions are destroying us one 
by one. If nothing is done to advance our cause, it should be 
noted that some day this country will desperately need us, but 
we will not be here. Thank you.
    Senator Enzi. Thank you very much.
    [A subsequent submission for the record from Mr. Hurst 
follows:]

[GRAPHIC] [TIFF OMITTED] T8240.019

    Mr. Enzi. Mr. Bousman.

STATEMENT OF JOEL E. BOUSMAN, CATTLE RANCHER, BOULDER, WYOMING, 
AND REGIONAL VICE PRESIDENT, WYOMING STOCKGROWERS ASSOCIATION, 
                        CASPER, WYOMING

    Mr. Bousman. Mr. Chairman, Members of this Committee, my 
name is Joel Bousman and I am a cattle rancher and regional 
vice president of the Wyoming Stockgrowers Association. My 
wife, Susan, and I, along with our son, Jim, and his wife and 
daughter, and our son, Cotton, operate a cattle ranch in 
western Wyoming. My sons are the fifth generation of our family 
in the ranching business in Sublette County. Our cattle ranch 
is an independently owned and operated small family business.
    After college I returned home to Boulder, Wyoming, and I 
bought 1,600 acres and the Federal grazing permits from my 
father. My wife and I did the work and we started to build both 
our family and our family ranch. In the summers we packed up 
the kids, the tent and the lunch cooler and we all headed to 
work in the hayfields for the day. To make ends meet, we worked 
the ranch together as a family.
    My children recognize that our family ranch is a real 
business opportunity with high-stake risks. The Federal 
Government could put us out of business with nothing more than 
the stroke of a pen.
    Grazing on Forest Service land is critical to my operation. 
If you will refer to the map up here, please, that is a map of 
Sublette County in western Wyoming. (See Page 40.) Jackson Hole 
is just to the northwest. Sublette County is about the size of 
the State of Connecticut. Both shades of the green on the map 
are Forest Service land. Yellow is administered by the Bureau 
of Land Management, blue, the State of Wyoming, and the small 
amount of white you see in the river corridors is the private 
land in Sublette County.
    Sublette County is only 20-percent private property. 
Livestock are on the private land during the winter and the 
spring until the new grass begins to grow. The ranchers, with 
BLM permits, pasture their cattle on the BLM land through June. 
Meanwhile, on all the privately-owned land, the irrigated hay 
land, the crops are being grown for the hay that is to be 
needed to get through the next winter.
    When the Forest Service range is ready for grazing in July, 
livestock are then herded into the higher mountain pastures 
until early fall. Two hundred and thirty-eight head of our 350 
mother cows graze a common Forest Service allotment from July 1 
till September 15.
    If our ranch loses our forest permit we would have the 
option to downsize our ranch or try to find other grazing land. 
If we downsize our small business, we would not be economically 
feasible and my sons would be unable to join me in my business. 
Purchasing private pasture in this case is not a realistic 
option because if you can see on the map, there is so little 
private land available in the county where I live.
    Another option would be for me to sell out to the highest 
bidder, likely a subdivision developer. Our land is at the foot 
of the Rocky Mountains and some of my neighbors have already 
chosen this option. I could sell and try to move elsewhere to 
ranch or just retire. I would have to give up my home in 
Boulder and the family business I have created, and I would 
sacrifice my hope and my dream to pass my family ranch on to my 
children.
    The threat to my grazing permit is not due to negative 
range conditions. I use scientific range monitoring. These 
lands are in good condition. Rather, the threat is from Federal 
regulations. The Forest Service often ignores the mandates from 
Congress to manage for balanced multiple use. Some of the 
nongrazing regulations that are harmful to our business include 
the endangered species regulations, the roadless initiative and 
Forest Service road policy and the Forest Service planning 
process itself.
    For example, 3 years ago on our ranch's grazing allotment 
the Wyoming Game and Fish and the Forest Service tried to 
restrict grazing. Their plan was to reduce livestock grazing 
while placing Colorado cutthroat trout in an intermittent 
stream. We were forced to spend a great deal of time and effort 
with scientific experts and fish biologists. Since the stream 
was intermittent, it had no water in it part of the year. The 
scientific experts finally convinced the fish biologists that 
fish cannot live without water. Can you imagine that?
    The time, energy and expense required to stay informed and 
respond to so many regulations and proposals hurts my ability 
to improve my operation. In the last year I estimate I have 
spent 15 working days and $1,700 responding to regulations.
    What difference does it make if increased regulations force 
me out of business? Critics of Federal lands livestock grazing 
fail to mention how important private lands are for wildlife. 
Like livestock, the majority of wildlife survive the winter on 
private lands. Ranchers provide winter forage, water and 
shelter for wildlife. Almost 100 percent of Wyoming moose make 
their winter home on private land. When a ranch is forced out 
of business there is a public cost, a public loss.
    For discussion purposes, let us look at a conservation 
easement that mandates no development. In Sublette County, a 
conservation easement attached to a ranch will reduce the 
market value by 40 to 50 percent. The open space and the 
wildlife habitat--in other words, the public value--would then 
be contained in the remaining 50 to 60 percent of the value of 
the ranch.
    Six years ago my son Cotton, then 14 years old, came here 
to Washington, D.C., to participate in a town meeting with 
President Clinton. Cotton talked about the importance of 
Federal grazing lands and the increasing costs imposed by 
government regulations and specifically the nonfee costs.
    Now, 6 years later, I am here testifying before this 
Committee about the impact of Forest Service regulations that 
still are threatening to take away both his dream and my hopes. 
Members of this Committee, I can assure you this situation has 
not improved in the last 6 years. Thank you.
    [The prepared statement of Mr. Bousman follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.020
    
    [GRAPHIC] [TIFF OMITTED] T8240.021
    
    [GRAPHIC] [TIFF OMITTED] T8240.022
    
    [GRAPHIC] [TIFF OMITTED] T8240.023
    
    [GRAPHIC] [TIFF OMITTED] T8240.024
    
    [GRAPHIC] [TIFF OMITTED] T8240.025
    
    [GRAPHIC] [TIFF OMITTED] T8240.026
    
    [GRAPHIC] [TIFF OMITTED] T8240.027
    
    [GRAPHIC] [TIFF OMITTED] T8240.028
    
    [GRAPHIC] [TIFF OMITTED] T8240.029
    
    Senator Enzi. Thank you.
    Our next person to testify is Mr. Tinsley.

 STATEMENT OF DEL TINSLEY, OWNER/PUBLISHER, WYOMING LIVESTOCK 
     ROUNDUP, CASPER, WYOMING, AND MEMBER, ADVISORY BOARD, 
 UNIVERSITY OF WYOMING COLLEGE OF AGRICULTURE, LARAMIE, WYOMING

    Mr. Tinsley. Good morning. I want to thank this Committee 
for the opportunity to testify and represent the great State of 
Wyoming. I am a Wyoming small businessman. Wyoming is where I 
raised my three children and where I have been self-employed 
for the past 25 years. I am a publisher of the Wyoming 
Livestock Roundup located in Casper. Our subscription base is 
85 percent of the people engaged in agriculture in Wyoming.
    The message I need to communicate to this Committee today 
is simple: The State of Wyoming is under attack by the Federal 
Government. This heavy-handed, regulations-laden government is 
distorting our wildlife habitat, our open spaces, threatening 
our culture and forcing our second-, third-, and fourth-
generation ranchers out of business.
    Virtually all of Wyoming is small business, including 
ranches. This is why it is so important to tell our story to 
this Committee.
    The Federal Government owns more than 50 percent of the 
State of Wyoming, as you can see on the map.
    [The map follows:]
    [GRAPHIC] [TIFF OMITTED] T8240.030
    
    Mr. Tinsley. Notice the different colors. The colors 
indicate the land ownership, including the Federal Government, 
State and private individually-owned land. The purple 
represents the National Parks, Yellowstone and Teton, and so 
forth. The green represents the National Forest. As you can 
see, we have five National Forests, I believe, in the State of 
Wyoming. The yellow represents the BLM, and the blue represents 
the State of Wyoming-owned land, like our school sections and 
we have a land trust in Wyoming. Orange represents the Wind 
River Indian Reservation, and the white represents deeded 
private property. If you look at the map closely you can see 
that the western part of the State, in my estimation, is more 
than 85 percent federally-owned.
    Well, let me explain the ownership of Wyoming and why it 
became the way it is. Back in the late 1800s and early 1900s 
during the Homestead Act, virtually everything on this map that 
is designated white and yellow was available for homesteading. 
Homesteaders could claim up to 640 acres. It started at 120 and 
moved up to 360 and now it is 640 acres because it is getting 
more arid the further west we go in our development of this 
great country.
    They had to live on the 640 acres for 1 year. One of the 
conditions was they had to have a wooden floor in their cabin 
to what they call ``prove-up'' or to get legal title to the 
property. But as arid as it is and with water as precious as 
gold, homesteaders chose to prove-up on lands with live water. 
If you can imagine bringing your family out West and as arid as 
Wyoming is, if you look at the drainages in Wyoming you can see 
that our deeded land is virtually our river bottoms and our 
creek flows and that sort of thing.
    In later years ranchers started accumulating these 
homesteads and assembling ranches. During that same period the 
Forest Service started issuing grazing permits on the forest, 
making these units balanced. They summered on the forest; they 
wintered on their deeded land.
    Today these second-, third-, and fourth-generation ranchers 
and families are being forced to reduce the number of livestock 
they can graze on the forests. That, coupled with the high cost 
of operation, is forcing these stewards of the land out of 
business. This, in turn, is leaving the deeded base ranch on 
the river bottoms vulnerable--which is very, very good wildlife 
habitat--vulnerable to subdivisions. As I mentioned earlier, 
these are prime wildlife habitat lands. These base operations 
are also very attractive to the developers because of the 
beautiful scenery, abundance of wildlife along the creek 
bottoms, and access to the National Forest.
    As a result of these developments, critical habitat is 
being lost and destroyed forever. The destruction is the exact 
opposite of what the Forest Service say they are accomplishing 
by putting ranchers out of business.
    The poster to my left depicts what used to be a ranch.
    [The poster follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.031
    
    Mr. Tinsley. The Lathrop Ranch featured about 10,000 acres 
of open space and critical wildlife habitat. This is the deeded 
land on this ranch. You can see the mountains in the 
background. That is where the cattle used to summer. This is 
critical wildlife habitat that once served as home to wintering 
cattle, elk, deer, antelope and other wildlife. It is now a 
subdivision. The people living in the subdivision are now 
complaining that the displaced wildlife is eating their 
shrubbery and there are problems. My wife and I go out and walk 
early in the mornings and we see deer on people's lawns chewing 
up their vegetation. Well, this was their winter home. The 
people displaced the wildlife.
    The people of Wyoming lose a way of life, a culture, when 
this is done. But everyone in our Nation loses the magnificent 
scenery and wildlife habitat that are provided by those 
ranching families that we are losing.
    Keeping the Federal land ownership in mind and coupling it 
with the fact that Wyoming's population is only 480,000, we 
soon realize that any change in the use dictated by the Forest 
Service guidelines dramatically impacts every man, woman, and 
child in Wyoming. In all 23 counties in Wyoming, there are 
people living there that have forest permits, including Gosham 
County, which is in eastern Wyoming on the Nebraska line. There 
are seven forest 
permit-holders there. The people of our State depend upon 
production agriculture and the use of renewable resources--
grazing, timber, minerals, wildlife, and open spaces. Forest 
Service policies that destroy the habitat and the landscapes by 
replacing ranchers with developments cripple both Wyoming and 
America.
    It was interesting yesterday morning when I picked up our 
local statewide paper that the Wyoming News Service did a 
survey and they asked people in Wyoming, ``What would you ask 
at the debate tonight?'' Overwhelmingly the people from Wyoming 
said we would ask, ``Why is our Federal Government shutting 
down our forests?'' Its affect is overwhelming. And I am not 
talking about people in agriculture; I am talking about people 
on the main streets of Wyoming.
    I would like to see this Senate set up a revenue impact 
study. Instead of an environmental impact study, let us study 
the revenue and what it is going to cost us to implement all of 
these regulations and the impact it is going to have on rural 
Wyoming.
    I want to talk just a minute about Yellowstone Park, if you 
will, please. Four years ago we went on a pack trip and we went 
through the southern part of Yellowstone Park. We went in the 
South Gate and made the loop opposite of the way the highway 
goes through. We rode through the burned areas with 1-million 
acres of the 3-million acres in Yellowstone National Park that 
were burned. Today the Canadian thistle, which is a noxious 
weed, has grown so thick in that country that you cannot ride a 
horse through it. This is what is happening. They will not 
spray it; they will not take care of it; but yet they let it 
burn and it has just done tremendous damage to our economy. It 
is a very serious situation.
    I want to conclude by thanking you for this opportunity to 
testify. I will be real happy to answer any questions that you 
may have. I would like to submit some other material with my 
testimony if I could, please.
    Senator Enzi. We will accept anything for the record that 
you want to add to your testimony. We appreciate the additional 
information and we will make sure that Members of the Committee 
have it, too.
    [The prepared statement and attachment of Mr. Tinsley 
follow:]

[GRAPHIC] [TIFF OMITTED] T8240.032

[GRAPHIC] [TIFF OMITTED] T8240.033

[GRAPHIC] [TIFF OMITTED] T8240.034

[GRAPHIC] [TIFF OMITTED] T8240.035

[GRAPHIC] [TIFF OMITTED] T8240.036

[GRAPHIC] [TIFF OMITTED] T8240.037

[GRAPHIC] [TIFF OMITTED] T8240.038

[GRAPHIC] [TIFF OMITTED] T8240.039

[GRAPHIC] [TIFF OMITTED] T8240.040

[GRAPHIC] [TIFF OMITTED] T8240.041

[GRAPHIC] [TIFF OMITTED] T8240.042

[GRAPHIC] [TIFF OMITTED] T8240.043

[GRAPHIC] [TIFF OMITTED] T8240.044

[GRAPHIC] [TIFF OMITTED] T8240.045

[GRAPHIC] [TIFF OMITTED] T8240.046

[GRAPHIC] [TIFF OMITTED] T8240.047

[GRAPHIC] [TIFF OMITTED] T8240.048

[GRAPHIC] [TIFF OMITTED] T8240.049

[GRAPHIC] [TIFF OMITTED] T8240.050

[GRAPHIC] [TIFF OMITTED] T8240.051

[GRAPHIC] [TIFF OMITTED] T8240.052

[GRAPHIC] [TIFF OMITTED] T8240.053

[GRAPHIC] [TIFF OMITTED] T8240.054

[GRAPHIC] [TIFF OMITTED] T8240.055

[GRAPHIC] [TIFF OMITTED] T8240.056

[GRAPHIC] [TIFF OMITTED] T8240.057

[GRAPHIC] [TIFF OMITTED] T8240.058

[GRAPHIC] [TIFF OMITTED] T8240.059

[GRAPHIC] [TIFF OMITTED] T8240.060

[GRAPHIC] [TIFF OMITTED] T8240.061

[GRAPHIC] [TIFF OMITTED] T8240.062

[GRAPHIC] [TIFF OMITTED] T8240.063

[GRAPHIC] [TIFF OMITTED] T8240.064

[GRAPHIC] [TIFF OMITTED] T8240.065

[GRAPHIC] [TIFF OMITTED] T8240.066

[GRAPHIC] [TIFF OMITTED] T8240.067

[GRAPHIC] [TIFF OMITTED] T8240.068

[GRAPHIC] [TIFF OMITTED] T8240.069

[GRAPHIC] [TIFF OMITTED] T8240.070

[GRAPHIC] [TIFF OMITTED] T8240.071

[GRAPHIC] [TIFF OMITTED] T8240.072

[GRAPHIC] [TIFF OMITTED] T8240.073

[GRAPHIC] [TIFF OMITTED] T8240.074

[GRAPHIC] [TIFF OMITTED] T8240.075

[GRAPHIC] [TIFF OMITTED] T8240.076

[GRAPHIC] [TIFF OMITTED] T8240.077

[GRAPHIC] [TIFF OMITTED] T8240.078

[GRAPHIC] [TIFF OMITTED] T8240.079

[GRAPHIC] [TIFF OMITTED] T8240.080

[GRAPHIC] [TIFF OMITTED] T8240.081

[GRAPHIC] [TIFF OMITTED] T8240.082

[GRAPHIC] [TIFF OMITTED] T8240.083

[GRAPHIC] [TIFF OMITTED] T8240.084

[GRAPHIC] [TIFF OMITTED] T8240.085

[GRAPHIC] [TIFF OMITTED] T8240.086

[GRAPHIC] [TIFF OMITTED] T8240.087

[GRAPHIC] [TIFF OMITTED] T8240.088

[GRAPHIC] [TIFF OMITTED] T8240.089

[GRAPHIC] [TIFF OMITTED] T8240.090

[GRAPHIC] [TIFF OMITTED] T8240.091

[GRAPHIC] [TIFF OMITTED] T8240.092

[GRAPHIC] [TIFF OMITTED] T8240.093

[GRAPHIC] [TIFF OMITTED] T8240.094

[GRAPHIC] [TIFF OMITTED] T8240.095

[GRAPHIC] [TIFF OMITTED] T8240.096

[GRAPHIC] [TIFF OMITTED] T8240.097

[GRAPHIC] [TIFF OMITTED] T8240.098

[GRAPHIC] [TIFF OMITTED] T8240.099

[GRAPHIC] [TIFF OMITTED] T8240.100

[GRAPHIC] [TIFF OMITTED] T8240.101

[GRAPHIC] [TIFF OMITTED] T8240.102

[GRAPHIC] [TIFF OMITTED] T8240.103

[GRAPHIC] [TIFF OMITTED] T8240.104

[GRAPHIC] [TIFF OMITTED] T8240.105

[GRAPHIC] [TIFF OMITTED] T8240.106

[GRAPHIC] [TIFF OMITTED] T8240.107

[GRAPHIC] [TIFF OMITTED] T8240.108

[GRAPHIC] [TIFF OMITTED] T8240.109

[GRAPHIC] [TIFF OMITTED] T8240.110

[GRAPHIC] [TIFF OMITTED] T8240.111

[GRAPHIC] [TIFF OMITTED] T8240.112

[GRAPHIC] [TIFF OMITTED] T8240.113

[GRAPHIC] [TIFF OMITTED] T8240.114

[GRAPHIC] [TIFF OMITTED] T8240.115

[GRAPHIC] [TIFF OMITTED] T8240.116

[GRAPHIC] [TIFF OMITTED] T8240.117

[GRAPHIC] [TIFF OMITTED] T8240.118

[GRAPHIC] [TIFF OMITTED] T8240.119

[GRAPHIC] [TIFF OMITTED] T8240.120

[GRAPHIC] [TIFF OMITTED] T8240.121

[GRAPHIC] [TIFF OMITTED] T8240.122

[GRAPHIC] [TIFF OMITTED] T8240.123

[GRAPHIC] [TIFF OMITTED] T8240.124

[GRAPHIC] [TIFF OMITTED] T8240.125

[GRAPHIC] [TIFF OMITTED] T8240.126

[GRAPHIC] [TIFF OMITTED] T8240.127

[GRAPHIC] [TIFF OMITTED] T8240.128

[GRAPHIC] [TIFF OMITTED] T8240.129

[GRAPHIC] [TIFF OMITTED] T8240.130

[GRAPHIC] [TIFF OMITTED] T8240.131

[GRAPHIC] [TIFF OMITTED] T8240.132

[GRAPHIC] [TIFF OMITTED] T8240.133

[GRAPHIC] [TIFF OMITTED] T8240.134

[GRAPHIC] [TIFF OMITTED] T8240.135

[GRAPHIC] [TIFF OMITTED] T8240.136

    Senator Enzi. Mr. Bukowsky.

STATEMENT OF AL BUKOWSKY, OWNER/OPERATOR, SOLITUDE RIVER TRIPS, 
                         SALMON, IDAHO

    Mr. Bukowsky. Mr. Chairman, I appreciate this opportunity 
to testify before the Committee. The management of Federal 
forest lands and forest uses is undoubtedly the single most 
significant factor in the economies of the rural communities in 
which my family and our employees live, so we are particularly 
grateful that congressional attention is being focussed on our 
relationship with the Forest Service.
    My name is Al Bukowsky. Along with my wife Jeana, we own 
and operate Solitude River Trips, a small outfitting and 
guiding business that has operated since the mid-1970s on the 
Middle Fork of the Salmon River in the Frank Church River of No 
Return Wilderness. I personally guide on all of our river 
trips, so you are listening not only to a businessman but a 
person who is directly in the field every river trip day.
    Mostly we have a good working relationship with the Forest 
Service. At other times they seem to ignore our input, as the 
following examples will illustrate. Outfitters met regularly 
with the Forest Service for several years leading up to the 
release of the draft environmental impact statement for the 
Frank Church River of No Return Wilderness in 1998. We were 
regularly assured that the resource was in better shape than 
when the Wilderness was designated in 1980. With minor tweaking 
in management, the Middle Fork could be expected to remain in 
great shape for the foreseeable future. We should expect only 
minor changes in management through the DEIS.
    In January 1998 the DEIS hit the streets and what a 
bombshell. The preferred alternative called for a 50-percent 
cut in river use, guided and nonguided. The preferred 
alternative recommended that a large portion of summer use be 
shifted to winter use, telling us that the Forest Service 
personnel obviously had no understanding of our business 
operations, let alone Idaho's weather. As you can see by the 
chart, they wanted to shift the peak use in the summer to the 
shoulder seasons, which in the Frank Church, the river is froze 
over and under several feet of snow.
    [The graph follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.137
    
    Senator Enzi. Figures.
    Mr. Bukowsky. Private and commercial users in the Frank 
screamed loudly. The Forest Service backed down, acknowledging 
publicly that they had spent $1 million on a DEIS that was 
seriously flawed. Forest Service staffers with a purist bent 
toward wilderness river use had misinterpreted their own 
sociological data in writing the DEIS. Outfitters had no 
alternative but to raise over $50,000 and spend countless hours 
of our time and many sleepless nights in order to deal with the 
inaccuracies in this dishonest document.
    To their credit, the Forest supervisors, especially George 
Matejko and Dave Alexander, became actively involved and worked 
closely with all users in a supplemental EIS process. The 
record of decision will be out sometime next year. Only then 
will we know if the Forest Service has really been up front and 
honest in their dealings with us.
    Outfitters on the Middle Fork tend to pinpoint the last 
decade as a turning point when the long history of good 
relations with the Forest Service began to disintegrate into a 
rockier road. For example, on April 9, 1997, we had an 
emergency meeting with the 
Middle Fork river managers. They told us that sensitive Native 
American sites along the Middle Fork were showing signs of 
abuse and would be closed to camping if our care for these 
sites did not improve in the coming season.
    These are prime camping sites for us, clustered closely 
together along a specific stretch of the Middle Fork. Closure 
would mean long days on the river without hope of a campsite 
for our guests, which naturally could lead to a serious safety 
issue.
    On June 12, 1997, barely 2 months later, outfitters showed 
up on the Middle Fork to launch their first trips of the float 
season. They were met at the launch site with paperwork from 
the same district ranger who had been at the April meeting, 
ordering that all 10 of the campsites were now closed to 
camping, as you can see by the letter signed by the district 
ranger.
    Outfitters immediately insisted upon a joint field trip. 
After much work and public involvement during the height of our 
operating season, the Forest Service finally agreed to a 
mitigation plan and reopened most of these campsites.
    The kicker in this story is that the campsite closure order 
given outfitters as they launched their first trips in June had 
been signed by the district ranger on April 1, 1997, 8 days 
before our emergency meeting with the outfitters he called 
together on April 9. What possible motive could the agency have 
had in hiding a decision already made 2 months earlier? Why in 
the meantime were we led through the charade of thinking 
outfitters and other boaters would be part of the 
decisionmaking process?
    [Form R4-2300-4 follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.138
    
    Mr. Bukowsky. There are also examples, however, of success 
in turning things around, in this instance in the Sawtooth 
National Recreation Area in central Idaho. Just 3 years ago the 
Upper Main Salmon River resource managers and outfitters were 
on extremely divergent roads relative to common sense 
management of that section of the river. To protect spawning 
Chinook salmon, the river was abruptly closed to float boaters 
each August, often with less than 12 hours notice. Lawsuits 
were filed. Communications between the outfitters and the 
Forest Service became nonexistent. Thanks to the constructive 
attitudes of two new rangers on the SNRA staff, outfitters and 
the Forest Service are once again working hand in hand. 
Communication and understanding there could not be better.
    Communication and collaboration is the key. Unfortunately, 
abrupt management style has become typical behavior for many 
within the agency. Because the special use permit conveys a 
privilege, not a right to operate, outfitters have little or no 
defense against sudden changes in the rules. A permit is not a 
contract and the sudden loss of privileges previously agreed 
upon between the agency and an outfitter is not compensable nor 
necessarily negotiable.
    Senator Craig recently reported legislation from the Senate 
Committee on Energy and Natural Resources that goes a long way 
toward providing a stable regulatory climate for the outfitting 
industry. S. 1969 seeks to create a statute from existing 
Forest Service outfitter and guide regulations that have worked 
well until recently. This legislation would put a stop to the 
agency's manipulation of outfitter rules into a moving target.
    Overall, the Forest Service is desperate for money and 
staff and the new cost recovery program for commercial 
outfitters is one of several new sources of agency revenue that 
threatens outfitters. Cost recovery, as proposed earlier this 
year, promises additional financial burdens that may break the 
back of outfitters and other small business operations on 
forest lands.
    In Idaho, cost recovery has already been proposed on the 
Upper Main Salmon River where outfitters and private boaters 
need a new take-out site in the effort to protect summer 
Chinook on their traditional spawning grounds. The Forest 
Service told us that all costs for NEPA analysis related to 
this new take-out would be charged exclusively to the four 
small float businesses that operate the Upper Salmon, despite 
the fact that many nonguided floaters enjoy the same stretch of 
river and would share the facility. Total cost for this NEPA 
work is estimated at $132,000, a $33,000 hit on each of these 
four outfitters and no hit on private boaters, which perfectly 
illustrates outfitter concerns about implementation of national 
cost recovery rules proposed earlier this year.
    The real kicker in the national cost recovery rule is the 
requirement that all fees be paid up front even prior to the 
resolution of a dispute or the permit will not be processed and 
you are out of business.
    In conclusion, I would like to emphasize to the Committee 
that outfitters fear they are seeing encouragement within the 
Forest Service of prejudice against commercial operations on 
forest land. Over 32 percent of the land in this country is 
owned by the Government. In recognition of this, agencies like 
the Forest Service must adhere to policies that sustain private 
sector businesses offering quality services to forest visitors, 
taxpaying businesses that are critical to the economies of 
local and regional communities.
    When Congress returns home at the end of this session, I 
hope that your Committee Members will repeat the theme of 
today's hearings in a series of town meetings throughout the 
State this winter. I know you will have participation from 
various outfitters and guide organizations. It was not so long 
ago that outfitters and guides were proud of their partnership 
with the Forest Service. We continue to be proud of the job we 
do together to protect the land and serve the public. Locally, 
it depends upon open communication and mutual respect.
    Mr. Chairman, it is my hope that your hearing today will be 
an important step toward putting the outfitters and other user 
groups, the Forest Service and the communities they serve back 
on this positive collaborative path. Thank you.
    [The prepared statement of Mr. Bukowsky follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.139
    
    [GRAPHIC] [TIFF OMITTED] T8240.140
    
    [GRAPHIC] [TIFF OMITTED] T8240.141
    
    [GRAPHIC] [TIFF OMITTED] T8240.142
    
    [GRAPHIC] [TIFF OMITTED] T8240.143
    
    [GRAPHIC] [TIFF OMITTED] T8240.144
    
    [GRAPHIC] [TIFF OMITTED] T8240.145
    
    [GRAPHIC] [TIFF OMITTED] T8240.146
    
    [GRAPHIC] [TIFF OMITTED] T8240.147
    
    [GRAPHIC] [TIFF OMITTED] T8240.148
    
    Senator Enzi. Thank you. This testimony has been 
outstanding and very helpful.
    Senator Burns has some appropriations meetings, which is a 
key thing. We are in the process of spending $1.8 trillion and 
he needs to go do some specific work on that, so we will defer 
to him for questions first.
    Senator Burns. Thank you, Mr. Chairman. I will be very, 
very short. I want to ask a couple of questions.
    By the way, I want Mr. Bousman to know that during the 
fires in western Montana I was down in the Big Hole, and you 
are familiar with Wisdom and through that country, and I was 
talking to the ranchers down there. We had a visit from the 
Rainbow family on the Forest Service land out there this year 
and there are about 20,000 of them, they figure, but they just 
flock everywhere.
    We got to go up and look at a couple of pastures, a couple 
of meadows that they just trashed. These people, 20,000 of 
them, had no permit to be there, none. They just flock in there 
and they destroy. You ought to see these meadows. I mean they 
are terrible. And when you compare them to a year ago, pictures 
taken, it was something.
    I asked the forest supervisor about that and why we have to 
jump through all the hoops for permits and then these people 
can come in and trash an area, leaving big rocks in the road so 
that you cannot get in and out, and they said they cannot get 
those people off of there. So there is a double standard here 
and we want to do away with that double standard if we possibly 
can.
    Mr. Hurst, we know that the Forest Service also has to 
adhere to some laws of the land--clean water, clear air, NEPA--
all of these laws that have been passed by this Congress. If 
there was one--if you could put your finger on one thing that 
would facilitate and bring some collaboration and communication 
between the Forest Service and your company and the management 
of those resources, what would it be? What would you advise us 
to change now that would facilitate both protecting the forest 
and making sure that we have a forest there for our children 
and our grandchildren?
    Mr. Hurst. It would probably be the Endangered Species Act. 
And I realize that is probably too much to bite off but what we 
need is more local control, more input and some trust in the 
folks at the local level that are making the decisions.
    Now we have purchased fire killed timber 500 miles north in 
the province of Alberta. I think it is the first time that 
government wood was ever exported to the United States from 
Alberta. The reason we did that is because we could not wood 
our mill from U.S. Forest Service timber because of the decline 
in timber sales from that agency.
    What I found is that the people in Alberta are closer to 
that resource. In other words, the province has control of the 
timber. As a result, they have a healthy economy. They harvest 
the timber, in this case burnt timber, in a timely fashion so 
that they can take the revenue from that harvested timber and 
reinvest it back into the ground in the form of reseeding or 
restoration.
    In the United States we do not do that. We do everything we 
can to keep resource workers unemployed, it appears, and we are 
not making the local decisions that we should, and that is why 
I talked about trust. And people, as you all know, out West we 
are not going to trash our own backyards, especially the folks 
that live there and have lived there. That is ridiculous.
    So I would guess something has to be done with the 
Endangered Species Act. We have got to speed up this appeals 
process and we have to have more trust in locals. That is not 
one thing; it's three things; I realize that. But if we can get 
more control back to the local land managers to make the 
decisions, that would greatly help our industry and our 
communities.
    Senator Burns. I want to ask the grazers, also. Mr. 
Bousman, what would you ask us to change to facilitate maybe 
cooperation between the agency and the grazers and to make sure 
that we can manage that resource?
    Mr. Bousman. Well, Senator, I think one of the concerns 
that has the most impact on our type of operation is the fact 
that too often decisions are made that do not have the 
scientific justification to make them. In that kind of a case I 
think if there was one thing that this Congress could do that 
would help the people on the land more than anything else, it 
would be to put the burden of proof on the Government. Before 
they could make a decision they should know that that decision 
is in the best interest of the resource and the best interest 
of the environment. Instead of doing that, they are making 
these decisions based on what is politically correct, not what 
is best for the land.
    Senator Burns. Anyone else want to comment on that 
question?
    Mr. Tinsley. Yes, I would, Senator Burns. If you talk to a 
lot of these retired forest people that are on the ground in 
Wyoming, they say the best years of the National Forests in 
this country were when it was managed from the bottom up rather 
than from the top down. That was when we had the best use and 
the healthiest forest.
    Senator Burns. If we expanded the SBREFA to include the 
Forest Service, would that help? That is the accountability, 
you know. It makes them accountable on all the decisions they 
make.
    Mr. Hurst. I think they should be. I mean they are directly 
affecting the lives of a broad spectrum of Westerners. They 
should be held accountable.
    Senator Burns. Thank you, Mr. Chairman. Thank you for 
letting me move up in the questioning.
    I want to thank our witnesses for coming this morning 
because they bring a lot of expertise to the table and we need 
that in this town. I call this town 17-square miles of logic-
free environment, so you bring a little common sense here, so 
your voice may sound a little strange.
    Senator Enzi. I again want to thank all of you for----
    Senator Burns. And you can have my log.
    Senator Enzi. Thank you. We will need that.
    Mr. Tinsley, you mentioned having hearings in our State and 
we do that through town meetings and all sorts of different 
ways. What has been so important for your effort today is that 
you are bringing a local perspective to the national level. 
When we talk to the folks in Wyoming, they understand the 
changes that are being made, but the folks back here have a 
little different atmosphere to live in. They have already 
eliminated most of the Federal land that they can wander around 
on and places that they can get away from the traffic and 
everything. So we have a lot of trouble educating Easterners on 
what it is like in the West. Your pictures and your maps and 
your letters have been extremely helpful today.
    Mr. Bukowsky, you are performing part of this tremendous 
effort because you are taking the people from back here and you 
are actually letting them see the area that they worked so hard 
to set aside, to make sure that it would be in a pristine 
State, and you are as interested in keeping it in that pristine 
State so we will be interested in coming to see it. It is kind 
of an oddity that we have the people out here thinking that the 
people out there would be interested in ruining their jobs.
    Mr. Hurst, we have the sawmills in Wyoming that have gone 
out of business. They are small businesses compared to the 
national standard, of course. They are very big businesses in 
the communities they are in and they just literally devastate 
the community when they go out of business.
    We are talking about healthy forests now, and that is an 
acceptable phrase throughout the United States. Everybody wants 
healthy forests. When I was with Senator Burns in Montana we 
did this hearing and one lady stated that she and her husband 
own a logging company in Montana and she is the accountant and 
runs the skidder, sometimes the chipper. That is how small 
business is. You have to do all of the jobs that are there. She 
is a little upset that they keep talking about in healthy 
forests having to grub out this underbrush that is not 
commercially usable and the dead tinder that there is in the 
forests.
    So she brought us that little log to show us what some of 
this undergrowth is, and it is commercially loggable. It would 
make a lot of boards for a lot of homes. And if you turn it 
into boards, it preserves the carbon dioxide that it has been 
capturing for probably 50 years permanently. If it falls over 
in the woods and disintegrates, that carbon dioxide goes back 
up in the atmosphere again and that is what we are blaming 
global warming for. So we understand the plight and appreciate 
the perspective that you have brought of how devastating that 
is.
    One of the reasons we are kind of hurrying here is that the 
Minority has objected to holding hearings over 2 hours. It is a 
constant protest that they have had for the last couple of 
weeks. So it is going to limit our hearing today. We are going 
to have to try to shove everything within 2 hours. We will keep 
the record open for 2 weeks. Other Members of the Committee may 
send you some additional questions so that we can get your 
responses in the printed record.
    Mr. Tinsley, I have to specifically ask you a question 
because I know you have a unique perspective on the impact of 
forest policies because you deal with paper products when you 
are putting out your newspaper. Can you tell us a little bit 
about some of the effects of Forest Service policies on paper 
production?
    Mr. Tinsley. Thank you, Senator. That is a good question 
and it is a good point that I would like to make.
    I think that the newspaper pulp industry in Canada learned 
a good lesson from OPEC this summer. They shut down the 
production of newsprint for about 3 weeks, shut it not 
completely down but they slowed it down about 20 percent, 
raised their prices by 20 percent and found out just how dang 
much control they have over the newspaper print industry in 
America. They liked what they saw, just like OPEC liked what 
they saw when they shut the oil flow down.
    Consequently, we had to go out and buy inferior paper from 
Mexico. I am not saying that to run down Mexico, but it just is 
not the quality of paper that we can get out of Canada and what 
is made here in America. It was pretty devastating and it was 
scary. I mean they could put us out of business in a heartbeat.
    Senator Enzi. So if we are not looking at multiple use we 
could be looking at--if we are happy with our gas prices now, 
we will really be happy with our newsprint prices, huh?
    Mr. Tinsley. Yes.
    Senator Enzi. Thank you.
    Mr. Bousman, you mentioned that your son, Cotton, came back 
to Washington and had the chance to ask the President a 
question. I am interested in what the response was to that 
question on grazing fees and also what your son thinks are his 
possibilities for being able to maintain the way of life, the 
open space and the future as he has envisioned it.
    Mr. Bousman. Senator, as far as the question, my son was 
fortunate enough to get to ask the President if he understood 
the interrelationship between the nonfee costs associated with 
grazing on public lands. The President indicated that he did 
not understand that. I cannot say as anything has changed 
except not just within the Forest Service but within all the 
Federal agencies that people in rural areas in our country have 
to deal with--the Fish and Wildlife Service regulations, BLM 
regulations, Forest Service regulations--they have all 
increased since that time.
    I would have to say, in fairness to the President, the 
grazing fee formula itself is still the same as it was 6 years 
ago. Other than that, everything has gotten worse.
    Not only my son, Cotton, but my other son, I am fortunate 
that both my boys would love to continue in the ranching 
business. I do not know how to explain it. It is something they 
have in their blood. People in our business can understand 
that. But the sum total of all these regulations--Forest 
Service is one example and probably the most glaring example 
but the Department of the Interior regulations, Fish and 
Wildlife regulations, Endangered Species, the roadless 
initiative have the impact of severely affecting our ability to 
continue. And, as I pointed out, the situation we are in, 
especially in western Wyoming, our options are limited. If I 
was to guess the way it appears that we are headed in the last 
years in the regulation from Washington, it is very 
discouraging, to say the least.
    Senator Enzi. Thank you.
    One final and what I think will be a quick question. Mr. 
Hurst, you stated that some day this country will need you but 
you will not be there. What did you mean by that?
    Mr. Hurst. Well, let us take the fires, this past summer, 
for example. Who were the movers and shakers on those fires? 
The loggers that had the equipment and the know-how to make the 
fire lines. That is one way. When we are gone, our loggers go 
with us. So when it comes to fighting the fires the next time, 
you know, it is not going to be as easy to put them out, and it 
was not easy this year at all.
    We are a small business and when you take a small business 
out of a community, for instance ours, who is going to go to 
that 4H livestock auction? We are having a hell of a poor year 
financially but we bought five beef and three pigs. Who is 
going to give the high school scholarships? The Sierra Club? 
The Wilderness Society? We have not seen one yet.
    Those are the kinds of things that will disappear when we 
do. It should also be noted that we will not turn the switch 
off because our corporate headquarters are in Stamford, 
Connecticut, or Seattle, Washington, with no direct contact to 
the communities. I have to look the people on Main Street in 
the eye, as these folks do, and we are going to take it that 
extra step to try to stay in business. That is why I am here. I 
can guarantee you there are one hell of a lot of things I would 
rather do than be in Washington, D.C. right now, but I owe it 
to my community, and I owe it to my employees to be here, so 
that if I have to turn that key off, I can at least look myself 
in the mirror and say, ``Goddang it, you gave it a try, Jim.'' 
Those are the things that you are going to miss.
    And I can guarantee you when the Coloradans and the 
Californians come out to Montana because it is quaint and they 
kind of like to rub elbows with those ranchers and loggers, all 
they are going to find is ex-Californians and Coloradans. So 
big deal.
    Senator Enzi. Once again if you like the price of gasoline, 
you are going to love the price of lumber.
    Senator Crapo.
    Senator Crapo. You might find some Canadian thistle, too.
    It is very notable to me that on the panel we have before 
us we have different industries represented. We have timber, 
grazing, outfitters and guides, and each industry is telling 
the same story.
    Mr. Hurst, I am not going to ask you a question but I just 
want to give you a little story of my own about the timber 
industry. We have a small community in Idaho in Lemhi County 
called Salmon, Idaho. There are about 10,000 people who live in 
the entire county and the county is probably the size of one of 
the northeastern States. About 70, 80, maybe even 90-percent 
plus of that county is federally- or state-owned.
    They had a little timber mill about 6 years ago in this 
county. I think it employed about 40 people. I went there as a 
Congressman and toured the mill. They were being threatened 
with not being able to get timber to cut. I asked them, as I 
toured the mill, how many board feet of timber they needed to 
be able to cut in this forest which they live right in the 
middle of and they gave me a number. I do not remember the 
number right now but they gave me a number that would keep 
these 40 people employed.
    Then that same day I went to the Forest Service and met 
with them and they talked to me about the forest management 
policies and their projections and they told me that in this 
forest, because of the climate and everything else, it took 
about 200 years for a tree to mature to where it could be 
harvested and they wanted to actually go to a 220-year cycle to 
harvest the trees to have a margin of error. I thought wow, 220 
years, there is probably not much timber that can be harvested 
out of this forest.
    But I asked them. I said, OK, if you accept your approach, 
how much timber would be able to be harvested in this forest if 
you kept the forest viable and healthy and only harvested on a 
220-year basis? They gave me a number that was 10 times what 
the little mill in the community needed. That little lumber 
mill is closed because they could not get enough to keep it 
open, when even on a very conservative estimate, they could 
have had 10 times in their local forest what they needed to 
harvest.
    That is the kind of thing I think we are talking about. I 
want to ask each of you, and I do not know that you all need to 
answer this question, but I would like to ask if any of you 
disagree with this statement. I have held a lot of hearings on 
this type of issue in Idaho in one way or another, whether they 
be town meetings or hearings or whatever, about the issue of 
whether we can have a viable, healthy natural resource-based 
economy and still protect the environment and have a strong, 
healthy, sustainable environment.
    And for people who do not live in these areas, the first 
question they are often faced with or that those who oppose 
access to the forests often raise is well, you are going to 
have to destroy the environment to allow these small businesses 
to thrive.
    Well, the people who live in Idaho want to have our forests 
be healthy and they want them there for their children and 
their grandchildren to recreate in and to enjoy for the quality 
of life and to have an economy, jobs, and the families that 
depend on those jobs. And I think that is doable.
    I would ask if any of you would like to make a quick 
comment because I have a couple of other questions about 
whether you think there is an inherent inability to maintain 
strong, viable forests and still have healthy small businesses 
in those forests.
    Mr. Bousman. Senator Crapo, I would like to comment along 
those lines that I do not believe there is any one of us 
sitting here at this table that do not realize that it is in 
our own best interest, as natural resource users, to make 
decisions which are in the long-term best interest of the 
environment and the natural resource.
    If we did not realize that, we would be ultimately putting 
ourselves out of business.
    Senator Crapo. What would you be doing to your son's future 
if you destroy the very environment you live in?
    Mr. Bousman. That is right. I would be destroying the 
future of the ability to pass these businesses down to the next 
generation.
    Senator Crapo. The yellow light just came on so I am going 
to ask each of the rest of you to just indicate whether you 
agree with that proposition.
    Mr. Tinsley. Yes.
    Mr. Bukowsky. Yes.
    Mr. Hurst. Wholeheartedly.
    Senator Crapo. Let me, in the last minute or so that I 
have, go to another issue that is very important to me. As we 
talk about different problems here, it seems to me that NEPA 
compliance, which you are all very familiar with, I think 
probably painfully familiar with, needs reform in the Federal 
system. The reason I say that is because each of you in one way 
or another has talked about the need for true collaborative 
decisionmaking as we approach these policy decisions. Mr. 
Bukowsky, you had actually mentioned that when it has worked, 
it has worked pretty well for you in your industry, and when it 
breaks down is when you really run into these problems.
    The question I have is, I think that true collaboration is 
more than just having an opportunity to comment and then often 
coming to us and asking to extend the comment period because 
you do not have time to comment, and more than just the 
opportunity to go to public hearings. Hearings and 
opportunities to comment are a form of public participation but 
to me, it is not collaboration.
    I think that we need true collaboration, meaning that the 
NEPA process should involve the local community, the small 
businesses in the community, and other interests--the 
environmental community, those who are concerned about all 
different aspects of the problem sitting down at a table and 
working through the best way to find common ground and achieve 
the multiple objectives that we have for forest management.
    Would any of you care to comment on that quickly?
    Mr. Tinsley. Yes, I would, Senator. Talking about the 
comments, I would like to make a comment about the comments. We 
do not get any opportunity to comment on how the forest and how 
the public land is used in eastern America. We would not 
comment. But the thing that bothers me the most is the fact 
that a comment coming from Atlanta, Georgia, on how we use our 
forest in Wyoming has just as much weight placed on it as does 
a comment coming from Joel Bousman, whose life is going to be 
ruined by the decision on how to use the forest.
    Senator Crapo. Good point.
    Mr. Tinsley. That really bothers me.
    Senator Crapo. Mr. Bukowsky, did you want to say anything?
    Mr. Bukowsky. The problem with NEPA is they hold all these 
town hall meetings and get all your input, and you think it 
will come out as part of that decision. But there is nothing in 
NEPA that says that once they have these town hall meetings and 
they take all this input that they have to use that input. What 
I have found out lots of times is that you spend years at all 
these meetings giving them input and then they end up not even 
using any of it, and the people that are giving the input have 
far more experience in the field than anyone in the Government.
    Senator Crapo. Thank you. I would love to go on with this 
with each of you but my time has expired and we are under a 
deadline here. We need to get the next panel up here so that we 
do not have to shut down before they have their chance. Thank 
you very much.
    Senator Enzi. I would again reiterate that the record will 
be open for another 2 weeks, so if you have additional material 
that you think would be helpful to us, we would appreciate 
that. And if Members of the Committee have additional 
questions, they will be sending those.
    If our next panel would take their places? We have some 
expertise now coming from Mr. Larry W. Van Tassell, professor 
and head, Department of Agricultural Economics and Rural 
Sociology from the University of Idaho in Moscow, Idaho and we 
have William McKillop, professor emeritus, the College of 
Natural Resources from the University of California-Berkeley in 
Berkeley, California. We appreciate your being here today.
    Mr. Van Tassell.

    STATEMENT OF LARRY W. VAN TASSELL, PROFESSOR AND HEAD, 
   DEPARTMENT OF AGRICULTURAL ECONOMICS AND RURAL SOCIOLOGY, 
               UNIVERSITY OF IDAHO, MOSCOW, IDAHO

    Mr. Van Tassell. Thank you, Senator Enzi. I would like to 
thank you for being able to visit with you today. As has been 
said, I am a professor and department head at the University of 
Idaho and only 11 months removed from the University of 
Wyoming.
    My intent today is to discuss with you how decisions made 
by the Forest Service impact Federal land ranchers. The 
decisions I will focus on deal with the number of animals that 
are allowed to graze or the amount of time they are allowed to 
spend on a Forest Service allotment.
    In the 1990s I was part of a study to examine the 
profitability of a ``representative'' ranching operation after 
it adjusted to a reduction in Federal AUMs. An AUM can be 
thought of as one cow grazing on the forest for 1 month. A 
mathematical model of a representative 300-cow ranch was 
developed using input from ranchers who run cattle on the Big 
Horn National Forest in Wyoming. The model was allowed to 
adjust cattle numbers and to convert hayland to pasture as 
Federal AUMs were reduced.
    The results of the study are presented in this table. As 
total Forest Service AUMs were reduced 25, 50 and 100 percent, 
numbers of cows were reduced from 300 head to 267, 221 and 164, 
respectively. These reductions translated into a decline in 
average annual net cash income of over $11,000, $15,000 and 
$52,000, respectively. The ending ranch equity dropped from the 
original 88 to 80 percent, 78 percent and 33 percent, 
respectively, under the 25-, 50- and 100-percent ranch 
reduction scenarios.
    The probability of receiving a negative cash flow increased 
from 4 percent under the no reduction scenario to 13, 18 and 
100 percent as AUMs were progressively reduced. A 36-percent 
reduction in required labor resulted when all permits were 
removed.
    [The table follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.149
    
    Mr. Van Tassell. Not only does a reduction in Forest 
Service AUMs reduce the income of individual ranchers but the 
rural communities are also impacted. Dr. Robert Fletcher took 
the results from our study and examined the impact the 
reduction in total AUMs of grazing allotted to cattle on the 
Big Horn National Forest would have on the surrounding four-
county area. He found that a 25-percent reduction in grazing 
would reduce yearly economic activity in the four-county area 
by $1.68 million per year, of which $441,000 would be personal 
income for local residents. The communities would lose over 31 
full-time equivalent jobs.
    Similar results have been found by other researchers. For 
example, Dr. Neil Rimbey found that, in Idaho, the yearly loss 
in rancher net income from a proposed reduction of 6,000 AUMs 
on the Sawtooth National Forest was over $90,000 per year.
    Another impact on ranchers from a reduction in Federal 
grazing is the loss of value in the permit they have purchased. 
When the U.S. Forest Service permanently cuts grazing rights, 
ranchers lose the equity they have in those permits. Over the 
1985 to 1992 study period, average permit values were generally 
in the $40 to $60 per AUM range for northern States, such as 
Wyoming and Idaho, where seasonal grazing is common and $90 or 
above per AUM for Arizona and New Mexico, where year-long 
grazing is common.
    A rancher that runs 300 head of cows on the Forest Service 
for 3 months of the year stands to lose approximately $18,000 
in equity if he or she receives a 50-percent reduction in the 
AUMs they are allowed to graze.
    The last thing I would like to mention is the trade-off 
between wildlife and livestock. I have heard many times that 
livestock need to be removed from the Forest Service lands to 
increase wildlife. In most areas, wildlife do not winter on the 
Forest Service lands but on private lands. When livestock are 
removed from the Federal lands, every AUM on private land 
becomes that much more essential to the survival of the ranch.
    This additional pressure does not make for a generous 
landowner when it comes to allowing wildlife to winter on 
private property. A recent study I did of Wyoming ranchers 
found that the average operation lost over $4,000 per year from 
wildlife depredation. Landowner tolerance, not habitat, is 
probably the limiting factor that imposes population bounds on 
big game.
    I believe that it is in the best interest of society for 
the Forest Service and ranching community to work together to 
keep livestock on public lands. In many areas of the West I 
feel this is happening. More damage will be done to public 
lands if ranchers are forced to sell to real estate developers 
than was ever imaginable with livestock. Thank you.
    [The prepared statement of Mr. Van Tassell follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.150
    
    [GRAPHIC] [TIFF OMITTED] T8240.151
    
    [GRAPHIC] [TIFF OMITTED] T8240.152
    
    [GRAPHIC] [TIFF OMITTED] T8240.153
    
    [GRAPHIC] [TIFF OMITTED] T8240.154
    
    Senator Enzi. Thank you very much.
    Mr. McKillop.

 STATEMENT OF WILLIAM McKILLOP, PROFESSOR EMERITUS, COLLEGE OF 
NATURAL RESOURCES, UNIVERSITY OF CALIFORNIA-BERKELEY, BERKELEY, 
                           CALIFORNIA

    Mr. McKillop. Good morning, Mr. Chairman and Members of the 
Committee. My name is William McKillop. I am professor emeritus 
of forest economics at the University of California-Berkeley. 
My degrees are in economics, statistics, and forest science. I 
have authored over 100 research publications and conference 
papers in the area of forestry and natural resource economics.
    My statement today is based on my own experience and 
research, and on data provided to me by a range of 
organizations, such as the Small Business Timber Council, the 
Independent Forest Products Association, California Forestry 
Association, and Intermountain Forest Association and Northwest 
Forestry Association.
    My Exhibit 1 shows the very severe decline that has taken 
place in U.S. Forest Service sawtimber sales in the past 
decade. In 1988 the total volume sold was 8.4 billion board 
feet. In 1998 it was only 1.9 billion board feet. That is a 6.5 
billion board feet decline, a 77-percent decline in sawtimber 
sales from the National Forests.
    In 1988, small business purchased 5.3 billion. That is 63 
percent of the total. And in 1998 they were able to purchase 
only 1.7 billion board feet.
    [The chart follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.155
    
    Mr. McKillop. These severe declines have had absolutely 
traumatic effects on the forest industry, on small timber 
companies, on working people and communities in the West. In 
the five-State region of Washington, Oregon, California, Idaho 
and Montana, there were 494 sawmills in 1989; now there are 
only 265 sawmills. There were 86 plywood plants; now there are 
only 48. There were 72 veneer plants in operation in 1989 and 
now there are only 31 veneer plants in operation.
    The severity of this impact is totally unprecedented. 
Exhibit 2 shows that the burden of sawmill closures has been 
disproportionately borne by small businesses. The red, the dark 
color, represents the proportion of small businesses that have 
closed. You see that 62 percent of the sawmills that closed 
were small businesses in Oregon; in California, 55 percent of 
them; in Washington, 70 percent of them; in Idaho, 71 percent; 
and in Montana, 75 percent of the sawmill closures were small 
businesses.
    For the five-State region, the total number of mills that 
have closed has been 250 and of those, 64 percent were small 
businesses. And that is sawmills.
    [The chart follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.156
    
    Mr. McKillop. Plywood plant closures--60 percent out of 30 
closures in Oregon were small business; 88 percent in 
Washington were small businesses. In the case of veneer plants, 
60 percent in Oregon were small businesses; 80 percent in 
Washington were small businesses. So there has been very much a 
disproportionate impact on small businesses of this huge 
decline in the Forest Service timber sales.
    Associated with these sawmill closures have been very, very 
large job losses. The job losses that have resulted from the 
closure of small wood processing plants were 57 percent of the 
total in Washington, 44 percent of the jobs lost in Oregon, 40 
percent of the jobs lost in California, 35 percent of them lost 
in Idaho, and 59 percent of them lost in Montana. Overall there 
were something like 27,600 jobs lost in wood processing plants 
in the last decade and of those, 46 percent were resulting from 
the closure of small businesses.
    [The chart follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.157
    
    Mr. McKillop. These jobs relate only to job losses due to 
the closure of wood processing plants. On top of that we have 
very substantial losses in the logging sector. Typically 
logging firms are small companies and this 6.5 billion board 
feet decrease, the 77-percent decrease in Forest Service saw 
timber output has had a devastating effect on the logging 
industry, as well as on the wood processing sector that I just 
mentioned.
    Lastly, we should note that small business losses due to 
this Forest Service policy are not just in the timber industry. 
Typically, the timber industry is a basic sector of any 
economy, regional or statewide or national economy. It supports 
jobs in the rest of the economy and the jobs that they support 
are very much jobs in the small business sector.
    So not only do we have the losses in wood processing and 
logging companies but we also have losses in the rest of the 
economy due to the Forest Service's severe decline in saw 
timber output. Thank you, Mr. Chairman. Those are my formal 
remarks.
    [The prepared statement of Mr. McKillop follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.158
    
    [GRAPHIC] [TIFF OMITTED] T8240.159
    
    Senator Enzi. I want to thank both of you for being here 
today. I am the only accountant in the U.S. Senate, so I have 
to tell you, I really love the numbers you were using. That is 
a very critical part of the hearing, too, to have some 
statistics from some very credible witnesses who are experts in 
this area that can show some of the devastation. I think both 
of you have done an excellent job.
    Mr. Van Tassell, I particularly appreciate your comments 
about the wildlife wintering on the private lands and that is 
uncompensated use. It helps to maintain wildlife in the West, 
which is something people really expect to see when they come 
out to the West. We may not be very long from the time that 
they will make special tours to see a cow.
    Ranchers have to obtain operating loans each year. Could 
you go into a little bit of how the uncertainty regarding the 
Federal grazing regulations, particularly the allotment 
restrictions, might impact those loans? Has the Forest Service, 
in your opinion, made efforts to reduce that uncertainty or has 
it taken operating loans into any consideration in its 
decisionmaking? Could you comment on that?
    Mr. Van Tassell. I do not know that they have taken 
operating loans into consideration at all but it impacts 
ranchers like it would any other business. When they go to a 
banker, if the assets they are using to produce their product 
are uncertain, the banker is not very willing to give them a 
loan on that.
    The other problem is that historically the grazing permit 
has held value for the rancher and the rancher has used that 
for collateral in obtaining loans. With the uncertainty 
surrounding whether a rancher is going to have those permits to 
graze, the bankers have been reluctant to use those for 
collateral. So many ranchers have lost that asset which they 
had previously used to get a loan; so the uncertainty does 
impact ranchers.
    Senator Enzi. Mr. McKillop, I appreciate again your 
emphasis on small businesses and how they are inordinately 
affected. Mr. Hurst mentioned earlier that the small businesses 
are the ones that buy the ad in the high school yearbook and 
purchase the 4H animals and they do not have corporate offices 
in another part of the country, so they have to face those 
people on Main Street and they are neighbors, they are actually 
neighbors that are devastated by the changes in business.
    Could you give us some of those indications of the 
magnitude of the impact just in the timber industry?
    Mr. McKillop. Yes. I gave you the job losses of 27,600 from 
wood processing jobs lost. In addition, there must be at least 
about 10,000 logging jobs lost. So there we have something like 
37,500 jobs lost in logging and sawmilling, plywood plants, 
veneer plants.
    Now every job--because the timber industry is part of the 
basic economy, every timber job supports one other job in the 
rest of the economy--in retail, wholesale, and service sectors. 
So you can just about double that number of jobs to get the 
total job losses. So you have about 37,500 jobs lost in the 
timber industry but that leads to a loss of another 37,500 jobs 
in the rest of the economy, therefore, you are talking about 
75,000 jobs lost because of this Forest Service policy that has 
led to the decline in timber harvests.
    Senator Enzi. Another thing that, of course, we apply in 
Wyoming is also the total population impact because each of 
those jobs represents three other people that are in the 
family, too. So now we are up around 300,000 people that are 
being affected by the timber. And, of course, all of those are 
not in Wyoming but our total population in Wyoming is 480,000 
so a small change in forest policy makes a big change in the 
lives of our people.
    Mr. McKillop. It is very destructive to family structures. 
It leads to break-ups of families or moving them. It is 
extremely hard on those communities.
    Senator Enzi. Again I point to the log over here. One of 
the comments that was made was that timbering has gotten this 
bad name in the United States but again they are interested in 
forest health. It is the future of jobs there, too. And it was 
pointed out that one of the big differences between a clear-
cut, which is never a clear-cut anymore but a clear-cut done by 
a timbering company and one done by Mother Nature is that the 
timbering company respects 200 feet from a stream.
    So thank you both for your testimony.
    Senator Crapo.
    Senator Crapo. Thank you, Mr. Chairman. I also will be 
brief because we do want to get our last panel on here in the 8 
minutes we have left. So I would just state, Mr. McKillop, I 
assume that you would agree with the SBA Office of Advocacy's 
comments to the Forest Service that their proposed rulemaking, 
particularly on the roadless rule, for example, does have a 
significant impact on small businesses.
    Mr. McKillop. Absolutely. I read the written testimony from 
the Forest Service, and I think it is totally incorrect to say 
that these actions will not have an effect on small businesses.
    Senator Crapo. Thank you very much.
    I would just ask a question quickly here, and that is, you 
indicated that there could possibly be more damage to the 
public lands if we do not properly manage the grazing 
activities because that would force other uses of these lands, 
such as development and the like, and I think that was very 
well stated in your testimony.
    Could you also comment on what I see as the flip side of 
that? Does grazing necessarily conflict with our ability to 
manage these public lands in a way that will maintain them as 
strong, healthy forests in the future indefinitely?
    Mr. Van Tassell. I am not an ecologist but I work with 
several ecologists and from what I have seen and heard and been 
around, they are very compatible. The grazing can be used as 
the management tool. In fact, I know for the sheep industry, 
some sheep producers are paid to graze some Canadian forests to 
help the ecology.
    Senator Crapo. Well, thank you. Again we could go into much 
more and I would like to but we just have a few minutes left 
and I would like to see our next panel get up here. Thank you 
very much.
    Senator Enzi. Thank you. I do appreciate the expertise 
represented here.
    The next person, our final panel, is Deputy Chief of the 
Forest Service, Jim Furnish. We appreciate you being here 
today. I understand that you are missing a major leadership 
conference in Connecticut. I understand that is where Mr. 
Dombeck is at the moment.
    We had the people from out of town come first because they 
have to travel and they need to deliver their entire testimony. 
Mr. Harkin and the Democrats have objected to anybody having a 
hearing of over 2 hours today and it severely limits our 
capabilities.
    We, of course, had hoped that Chief Dombeck could join us 
and are terribly disappointed that he did not. We will be 
submitting some questions for him to answer; at this point I 
will let you begin your testimony.

 STATEMENT OF JAMES R. FURNISH, DEPUTY CHIEF, NATIONAL FOREST 
    SYSTEM, FOREST SERVICE, U.S. DEPARTMENT OF AGRICULTURE, 
                        WASHINGTON, D.C.

    Mr. Furnish. Mr. Chairman and Members of the Committee, 
thank you for the opportunity to be here. Knowing you have 
limited time, I am going to keep my remarks very brief to 
provide you ample opportunity to ask questions if you would 
care to.
    We have three basic parts of our organization that try to 
address the needs of small business. One is our State and 
Private Forestry Organization, which is really our outreach 
effort to communities and the business community in America. We 
also have a research community through facilities like our 
Forest Products Lab in Madison, Wisconsin, that for many 
decades has sought to work in innovative ways with private 
business to develop the necessary tools and technology to 
enable small business to thrive. Then, really, the last is the 
National Forests, most of which are in the Western United 
States, where we feel we are inextricably linked, as has been 
amply testified to earlier, with small businesses and small 
communities throughout rural America.
    With respect to some of the regulations the Forest Service 
currently has in operation, it is true that we have made the 
determination that neither the planning regulation nor the 
roads policy, we feel, has a significant effect on a 
substantial number of small businesses. However, the roadless 
policy that is now undergoing final preparation, we did 
complete an Initial Regulatory Flexibility Analysis and we are 
proceeding with the assistance of the Small Business 
Administration Office of Advocacy to address their concerns. We 
are in preparation of a Final Regulatory Flexibility Analysis 
to comply with the legal requirements.
    I think in summary, I would just say that National Forest 
lands are experiencing an ever-increasing demand for a variety 
of uses from a growing and increasingly diverse population. 
There is a continuous demand for commodity production, along 
with an increasing demand for recreation, water, wildlife, 
fish, and other tangible and intangible goods and services.
    We realize that there are diverse and many needs and 
requests to use National Forest System lands. We try to work 
with small businesses at the local level, as well as with the 
Small Business Administration to evaluate, resolve, and address 
the impacts of competing uses on these small businesses.
    Some local communities may experience local hardships, as 
has been testified to earlier. We plan to focus our efforts in 
these few communities to help develop community-led efforts to 
mitigate impacts and help them diversify their economies.
    We believe that today the opportunities for job creation in 
new stewardship industries are immense. Maintaining our 
existing roads, facilities and recreation infrastructure, 
reducing fire risk, and restoring watersheds could lead to 
thousands of high-paying private sector jobs that emphasize 
ecosystem restoration and forest stewardship.
    This concludes my verbal testimony. My written testimony 
has been submitted. I would be happy to address any of your 
questions.
    [The prepared statement of Mr. Furnish follows:]

    [GRAPHIC] [TIFF OMITTED] T8240.160
    
    [GRAPHIC] [TIFF OMITTED] T8240.161
    
    [GRAPHIC] [TIFF OMITTED] T8240.162
    
    [GRAPHIC] [TIFF OMITTED] T8240.163
    
    [GRAPHIC] [TIFF OMITTED] T8240.164
    
    Senator Enzi. Your entire testimony will be a part of the 
record.
    I am going to keep a very close eye on the clock because I 
am notified that if we do not shut down the hearing by the 
11:30 time that the whole hearing is null and void, and we 
certainly do not want that to happen because we have had some 
excellent testimony.
    I have to say that I want to have more information about 
why we are nationalizing the National Forests instead of 
keeping the practices at the local level where there was a 
local forester who knew what was going on. We have gone to a 
one-size-fits-all policy in the Forest Service. I can tell you 
the forests out here do not look anything like the forests in 
Wyoming, and you cannot manage a forest in Wyoming the way you 
manage a forest here. Out there we need as much water as we can 
get. Out here they are trying to drain it off.
    I really want to know more about why you are trying to 
avoid small business input. I was particularly interested in 
your comment that you are going to comply with the legal 
requirements. Our interest is not in your complying with the 
legal requirements. Our interest is in your finding out what 
small businesses need and trying to interact with them and work 
with them. When we talk about complying with the regulations, 
it sounds like you are going to meet whatever you can, staying 
within any loopholes that we might have built into the law, and 
that is what we are talking about--passing some additional laws 
to plug up those loopholes.
    I see the yellow light is on and I do not want this hearing 
to be null and void so we will be providing you with additional 
questions and you can provide additional comments.
    With that, I will adjourn the hearing and leave the record 
open.
    [Whereupon, at 11:29 a.m., the Committee was adjourned.]

    [GRAPHIC] [TIFF OMITTED] T8240.165
    
    [GRAPHIC] [TIFF OMITTED] T8240.166
    
    [GRAPHIC] [TIFF OMITTED] T8240.167
    
    [GRAPHIC] [TIFF OMITTED] T8240.168
    
    [GRAPHIC] [TIFF OMITTED] T8240.169
    
    [GRAPHIC] [TIFF OMITTED] T8240.170
    
    [GRAPHIC] [TIFF OMITTED] T8240.171
    
    [GRAPHIC] [TIFF OMITTED] T8240.172
    
    [GRAPHIC] [TIFF OMITTED] T8240.173
    
    [GRAPHIC] [TIFF OMITTED] T8240.174
    
    [GRAPHIC] [TIFF OMITTED] T8240.175
    
    [GRAPHIC] [TIFF OMITTED] T8240.176
    
    [GRAPHIC] [TIFF OMITTED] T8240.177
    
    [GRAPHIC] [TIFF OMITTED] T8240.178
    
    [GRAPHIC] [TIFF OMITTED] T8240.179
    
    [GRAPHIC] [TIFF OMITTED] T8240.180
    
    [GRAPHIC] [TIFF OMITTED] T8240.181
    
    [GRAPHIC] [TIFF OMITTED] T8240.182
    
    [GRAPHIC] [TIFF OMITTED] T8240.183
    
    [GRAPHIC] [TIFF OMITTED] T8240.184
    
    [GRAPHIC] [TIFF OMITTED] T8240.185
    
    [GRAPHIC] [TIFF OMITTED] T8240.186
    
    [GRAPHIC] [TIFF OMITTED] T8240.187
    
    [GRAPHIC] [TIFF OMITTED] T8240.188
    
    [GRAPHIC] [TIFF OMITTED] T8240.189
    
    [GRAPHIC] [TIFF OMITTED] T8240.190
    
    [GRAPHIC] [TIFF OMITTED] T8240.191
    
    [GRAPHIC] [TIFF OMITTED] T8240.192
    
    [GRAPHIC] [TIFF OMITTED] T8240.193
    
    [GRAPHIC] [TIFF OMITTED] T8240.194
    
    [GRAPHIC] [TIFF OMITTED] T8240.195
    
    [GRAPHIC] [TIFF OMITTED] T8240.196
    
    [GRAPHIC] [TIFF OMITTED] T8240.197
    
    [GRAPHIC] [TIFF OMITTED] T8240.198
    
    [GRAPHIC] [TIFF OMITTED] T8240.199
    
    [GRAPHIC] [TIFF OMITTED] T8240.200
    
    [GRAPHIC] [TIFF OMITTED] T8240.201
    
    [GRAPHIC] [TIFF OMITTED] T8240.202
    
    [GRAPHIC] [TIFF OMITTED] T8240.203
    
    [GRAPHIC] [TIFF OMITTED] T8240.204
    
    [GRAPHIC] [TIFF OMITTED] T8240.205
    
    [GRAPHIC] [TIFF OMITTED] T8240.206
    
