Wildland Fire Suppression: Better Guidance Needed to Clarify	 
Sharing of Costs between Federal and Nonfederal Entities	 
(21-JUN-06, GAO-06-896T).					 
                                                                 
Wildland fires can burn or threaten both federal and nonfederal  
lands and resources, including homes in or near wildlands, an	 
area commonly called the wildland-urban interface. Agreements	 
between federal and nonfederal firefighting entities provide the 
framework for working together and sharing the costs of fire	 
suppression efforts. GAO was asked to (1) review how federal and 
nonfederal entities share the costs of suppressing fires that	 
burn or threaten both of their lands and resources and (2)	 
identify any concerns that these entities may have with the	 
existing cost-sharing framework. This testimony is based on GAO's
May 2006 report Wildland Fire Suppression: Lack of Clear Guidance
Raises Concerns about Cost Sharing between Federal and Nonfederal
Entities (GAO-06-570).						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-896T					        
    ACCNO:   A55851						        
  TITLE:     Wildland Fire Suppression: Better Guidance Needed to     
Clarify Sharing of Costs between Federal and Nonfederal Entities 
     DATE:   06/21/2006 
  SUBJECT:   Cost analysis					 
	     Cost sharing (finance)				 
	     Fire fighters					 
	     Forest fires					 
	     Forest management					 
	     Interagency relations				 
	     Policy evaluation					 
	     Wildfires						 
	     Wildland fires					 

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO Product.                                                 **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
******************************************************************
GAO-06-896T

     

     * Summary
     * Background
     * Unclear Guidance and Inconsistent Application of Cost-Sharin
          * Master Agreements Provided Cost-Sharing Framework, but Those
          * Cost-Sharing Methods Were Inconsistently Applied for the Eig
          * The Cost-Sharing Method Used Can Lead to Significantly Diffe
     * Current Cost-Sharing Framework Raises Several Concerns
          * Lack of Clear Guidance Can Lead to Difficulties in Sharing C
          * Nonfederal Officials Were Concerned about Increased Costs an
          * Cost-Sharing Framework May Reduce Incentives to Mitigate Fir
          * Officials' Concerns May Reflect Ambiguity over Financial Res
     * Conclusions
     * GAO Contact and Staff Acknowledgments
          * Order by Mail or Phone

Testimony

Before the Subcommittee on Public Lands and Forests, Committee on Energy
and Natural Resources, U.S. Senate

United States Government Accountability Office

GAO

For Release on Delivery Expected at 2:30 p.m. EDT

Wednesday, June 21, 2006

WILDLAND FIRE SUPPRESSION

Better Guidance Needed to Clarify Sharing of Costs between Federal and
Nonfederal Entities

Statement of Robert A. Robinson, Managing Director Natural Resources and
Environment

GAO-06-896T

Mr. Chairman and Members of the Subcommittee:

I am pleased to be here today to discuss how federal and nonfederal
entities share the costs of suppressing wildland fires that burn or
threaten both federal and nonfederal lands and resources. As you know,
fighting wildland fires-which can burn across federal, state, and local
jurisdictions-requires significant investments of firefighting personnel,
aircraft, equipment, and supplies, resulting in substantial and increasing
fire suppression expenditures. Since 2000, federal suppression
expenditures alone have averaged more than $1 billion annually.
Firefighting efforts are mobilized through an interagency incident
management system, which depends on the close cooperation and coordination
of federal, state, tribal, and local fire protection entities. At the
federal level, five principal agencies are involved in firefighting
efforts-the Forest Service within the Department of Agriculture and the
Bureau of Indian Affairs, Bureau of Land Management, Fish and Wildlife
Service, and National Park Service within the Department of the Interior.
Federal and nonfederal firefighting entities share their personnel,
equipment, and supplies and work together to fight fires, regardless of
which entity has jurisdiction over the burning lands. Agreements between
cooperating entities, commonly referred to as master agreements, govern
these cooperative fire protection efforts and include general provisions
for sharing firefighting costs.

My testimony today summarizes the findings of our report1 released on June
13, 2006, which discusses (1) how federal and nonfederal entities share
the costs of suppressing wildland fires that burn or threaten both of
their lands and resources and (2) concerns federal and nonfederal entities
have with the existing cost-sharing framework. To address these
objectives, we reviewed applicable federal statutes, policies, and
procedures; and federal and nonfederal studies related to wildland fire
suppression costs. We reviewed master agreements between federal and
nonfederal entities governing cooperative fire protection in 12 western
states that frequently experience wildland fires.2 We also reviewed fire
records and interviewed federal and nonfederal firefighting officials to
discuss methods chosen to share suppression costs for eight recent
fires-two each in Arizona, California, Colorado, and Utah-which burned or
threatened both federal and nonfederal lands and resources. 3

1 GAO, Wildland Fire Suppression: Lack of Clear Guidance Raises Concerns
about Cost Sharing between Federal and Nonfederal Entities, GAO-06-570
(Washington, D.C.: May 30, 2006).

2The 12 states selected were Alaska, Arizona, California, Colorado, Idaho,
Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.
Although wildland fires can affect all states, we selected these western
states because they have substantial federal lands and often experience
wildland fires.

                                    Summary

Federal and nonfederal entities used a variety of methods to share the
costs of fighting wildland fires affecting both of their lands and
resources, but they applied these varied methods inconsistently to fires
with similar characteristics. Master agreements between firefighting
entities provide the framework for cost sharing and, typically, list
several cost-sharing methods available to the entities. The agreements we
reviewed, however, often lacked clear guidance for federal and nonfederal
officials to use in deciding which method to apply to a specific fire. As
a result, cost-sharing methods were applied inconsistently within and
among states, even for fires with similar characteristics. For example

           o  In one state, the costs for suppressing a large fire that
           threatened homes were shared solely according to the proportion of
           acres burned within each entity's area of fire protection
           responsibility.
           o  In the same state, costs for a similar fire were shared
           differently-the state paid for certain aircraft and fire engines
           used to protect homes, while the remaining costs were shared on
           the basis of acres burned.
           o  In another state, officials used yet a different cost-sharing
           method for two similar large fires that threatened homes,
           apportioning costs each day for personnel, aircraft, and equipment
           deployed on particular lands, such as the wildland-urban
           interface, an area where homes and other structures are located in
           or near wildlands.

           The type of cost-sharing method ultimately used is important
           because it can have significant financial consequences for the
           entities involved, potentially amounting to millions of dollars.

           Federal and nonfederal agency officials we interviewed raised a
           number of concerns about the current cost-sharing framework.

           o  First, some federal officials said that because master
           agreements and other policies do not provide clear guidance about
           which cost-sharing methods to use, it has sometimes been difficult
           to obtain a cost-sharing agreement that they believe shares
           suppression costs equitably.
           o  Second, nonfederal officials were concerned that the emergence
           of alternative cost-sharing methods has caused nonfederal entities
           to bear a greater share of fire suppression costs than in the
           past. In addition, these officials, as well as some federal
           officials, were concerned that the federal government was treating
           nonfederal entities in different states differently, thereby
           creating inequities.
           o  Finally, some federal officials expressed concern that the
           current framework for sharing costs insulates state and local
           governments from the cost of protecting the wildland-urban
           interface, thereby reducing their incentive to take steps that
           could help mitigate fire risks and reduce suppression costs in the
           wildland-urban interface.

           On the basis of our review of previous federal reports and
           interviews with federal and nonfederal officials, we believe these
           concerns may reflect a more fundamental issue-that federal and
           nonfederal entities have not clearly defined their financial
           responsibilities for wildland fire suppression, particularly for
           the wildland-urban interface.

           Background
			  
			  Although wildland fires triggered by lightning are a natural,
           inevitable, and in many cases a necessary ecological process, past
           federal fire suppression policies have led to an accumulation of
           fuels and contributed to larger and more severe wildland fires. In
           recent years, both the number of acres burned by wildland fires
           and the costs to suppress fires have been increasing. From 1995
           through 1999, wildland fires burned an average of 4.1 million
           acres each year; from 2000 through 2004, the fires burned an
           average of 6.1 million acres each year-an increase of almost 50
           percent. During the same periods, the costs incurred by federal
           firefighting entities to suppress wildland fires more than
           doubled, from an average of $500 million annually to about $1.3
           billion annually.4 Although efforts to fight these larger, more
           severe fires have accounted for much of the increase in
           suppression costs, the continuing development of homes and
           communities in areas at risk from wildland fires and the efforts
           to protect these structures also contribute to the increasing
           costs. Forest Service and university researchers estimate that
           about 44 million homes in the lower 48 states are located in the
           wildland-urban interface. When fire threatens the wildland-urban
           interface, firefighting entities often need to use substantial
           resources-including firefighters, fire engines, and aircraft to
           drop retardant-to fight the fire and protect homes.

           As wildland fire suppression costs have continued to rise,
           increasing attention has focused on how suppression costs for
           multijurisdictional fires are shared. To share suppression costs
           for a specific fire, local representatives of federal and
           nonfederal firefighting entities responsible for protecting lands
           and resources affected by the fire-guided by the terms of the
           master agreement-decide which costs will be shared and for what
           period. They document their decisions in a cost-sharing agreement
           for that fire. According to federal officials, cooperating
           entities traditionally shared suppression costs on the basis of
           the proportion of acres burned in each entity's protection area
           because the method was relatively easy to apply and works well
           when the lands affected by a wildland fire are similar. Officials
           said that the use of alternative cost-sharing methods has been
           increasing in recent years.

           Unclear Guidance and Inconsistent Application of Cost-Sharing 
			  Methods Can Have Significant Financial Consequences for Entities 
			  Involved
			  
			  Federal and nonfederal entities included in our review used a
           variety of methods to share the costs of fighting fires that
           burned or threatened both federal and nonfederal lands and
           resources. Although master agreements between federal and
           nonfederal entities typically listed several cost-sharing methods,
           the agreements often lacked clear guidance for officials to follow
           in deciding which cost-sharing method to apply to a specific fire.
           Consequently, for eight fires we reviewed in four states, we found
           varied cost-sharing methods used and an inconsistent application
           of these methods within and among states, although the fires had
           similar characteristics. The type of cost-sharing method chosen is
           important because it can have significant financial consequences
           for the federal and nonfederal entities involved.

           Master Agreements Provided Cost-Sharing Framework, but Those We 
			  Reviewed Lacked Clear Guidance
			  
			  Master agreements provide the framework for federal and nonfederal
           entities to work together and share the costs of fighting wildland
           fires. The master agreements we reviewed for 12 western states all
           directed federal and nonfederal entities to develop a separate
           agreement, documenting how costs were to be shared for each fire
           that burned-or, in some cases, threatened to burn-across multiple
           jurisdictions. The master agreements varied in the cost-sharing
           methods specified:

           o  The master agreement for 1 state (Idaho) did not identify any
           specific cost-sharing method to use.
           o  The master agreements for 3 states (Alaska, Arizona, New
           Mexico) listed the acres-burned method as the primary or only
           method to be used. Although two of these agreements allowed the
           use of alternative cost-sharing methods, they did not explicitly
           state under what circumstances an alternative method would be
           appropriate.
           o  The master agreements for 8 remaining states listed multiple,
           alternative cost-sharing methods but did not provide clear
           guidance on when each method should be used.

Cost-Sharing Methods Were Inconsistently Applied for the Eight Fires We 
Reviewed

			  Federal and nonfederal entities used varied cost-sharing methods
           for the eight fires we reviewed, although the fires had similar
           characteristics. As shown in figure 1, the cost-sharing methods
           used sometimes varied within a state or from state to state.

3The 12 master agreements reviewed, 4 states visited, and two wildland
fires reviewed within each visited state are all nonprobability samples.
Therefore, the results from these samples cannot be used to make
inferences about all master agreements, states, or wildland fires.

                                   Background

4These dollars have been adjusted for inflation using the gross domestic
product price index, with fiscal year 2005 as the base year.

 Unclear Guidance and Inconsistent Application of Cost-Sharing Methods Can Have
            Significant Financial Consequences for Entities Involved

Master Agreements Provided Cost-Sharing Framework, but Those We Reviewed Lacked
Clear Guidance

Cost-Sharing Methods Were Inconsistently Applied for the Eight Fires We Reviewed

Figure 1: The Varied Cost-Sharing Methods Used for Eight Similar Fires We
Reviewed

aA complex consists of two or more individual fires located in the same
general area and managed by a single incident commander.

The costs for the two fires that we reviewed in Utah were shared using two
different methods, although both fires had similar characteristics.

           o  For the Blue Springs Fire, federal and nonfederal officials
           agreed that aircraft and engine costs of protecting an area in the
           wildland-urban interface during a 2-day period would be assigned
           to the state and the remaining costs would be shared on the basis
           of acres burned. Federal and state officials explained that,
           because the Blue Springs Fire qualified for assistance from the
           Federal Emergency Management Agency (FEMA), state officials agreed
           to bear a larger portion of the total fire suppression costs.5 
           o  For the Sunrise Complex of fires, in contrast, state officials
           were reluctant to share costs in the same manner. Although these
           fires also threatened the wildland-urban interface, they did not
           meet the eligibility requirements for FEMA reimbursement of
           nonfederal costs. Consequently, federal and nonfederal officials
           agreed to share costs for the Sunrise Complex on the basis of
           acres burned.

           The costs for the two fires we reviewed in Arizona were also
           treated differently from each other.

           o  For the Cave Creek Complex of fires, federal and state
           officials agreed to share suppression costs using an acres-burned
           method for the southern portion of the complex, which encompassed
           federal, state, and city lands and required substantial efforts to
           protect the wildland-urban interface. The federal government paid
           the full costs for the northern portion of the fire.
           o  For the Florida Fire, federal and nonfederal officials were
           unable to reach an agreement on how to share costs. Officials from
           the affected national forest proposed a cost-sharing agreement,
           whereby the state would pay the costs of firefighting personnel,
           equipment, and aircraft used to protect the wildland-urban
           interface, and all other fire suppression costs would be paid by
           the federal government. The state official, however, did not agree
           with this proposal. He believed that the Forest Service, not the
           state, was responsible for protecting areas of the wildland-urban
           interface threatened by the Florida Fire and that he was not
           authorized to agree to the terms of the proposed agreement.6

           Methods used to share suppression costs for fires with similar
           characteristics also varied among states. For example, costs for
           the fires we reviewed in California and Colorado were shared using
           methods different from those used for similar fires we reviewed in
           Arizona and Utah.

           o  In California, federal and nonfederal officials agreed to share
           the costs of two fires using the cost-apportionment method-that
           is, costs were apportioned on the basis of where firefighting
           personnel and equipment were deployed. Officials said that they
           had often used this method since the mid-1980s because they
           believed that the benefit it provides in more equitable cost
           sharing among affected firefighting entities outweighs the
           additional time required to apportion the costs.
           o  In Colorado, federal and nonfederal officials agreed to share
           suppression costs for both of the fires we reviewed in that state
           using guidance they had developed and officially adopted in 2005,
           called "fire cost share principles." Under these principles,
           aviation costs for fires burning in the wildland-urban interface
           are shared equally for 72 hours, and other fire suppression costs,
           such as firefighting personnel and equipment, are shared on the
           basis of acres burned.

           The Cost-Sharing Method Used Can Lead to Significantly Different 
			  Financial Outcomes
			  
			  Having clear guidance as to when particular cost-sharing methods
           should be used is important because the type of method ultimately
           agreed upon for any particular fire can have significant financial
           consequences for the firefighting entities involved. To illustrate
           the effect of the method chosen, we compared the distribution of
           federal and nonfederal costs for the five fires we reviewed in
           which the actual cost-sharing method used was not acres burned
           with what the distribution would have been if the method used had
           been acres burned. We found that the distribution of costs between
           federal and nonfederal entities differed, sometimes substantially,
           depending on the cost-sharing method used. The largest differences
           occurred in California, which used the cost apportionment method.

           o  For the Deep Fire, using the cost-apportionment method, federal
           entities paid $6.2 million, and nonfederal entities paid $2.2
           million. Had the costs been shared on the basis of acres burned,
           federal entities would have paid an additional $1.7 million, and
           nonfederal entities would have paid that much less because most of
           the acres burned were on federal land. According to federal and
           state officials, the nonfederal entities bore a larger share of
           the cost than they would have under an acres-burned method because
           of the efforts to protect nonfederal lands and resources.
           o  For the Pine Fire, using cost apportionment, federal entities
           paid $5.2 million, and nonfederal entities paid $8.1 million. Had
           an acres-burned method been used, federal entities would have paid
           about $2 million less, and nonfederal entities would have paid
           that much more. According to a federal official who worked on
           apportioning costs for that fire, the higher costs that the
           federal entities paid under cost apportionment were largely due to
           extensive firefighting efforts on federal land to ensure that the
           fire was extinguished.

           In Colorado and Utah, the differences in federal and state
           entities' shares between the methods used and the acres-burned
           method were less pronounced, likely because the cost-sharing
           methods used still relied heavily on acres burned. In each case,
           federal entities' shares would have been more and nonfederal
           shares less had an acres-burned method been used, due to the
           efforts to protect the wildland-urban interface. For example, the
           federal share of costs for the Blue Springs Fire in Utah would
           have been about $400,000 more and the nonfederal share that much
           less if an acres-burned method had been used for the whole fire.
           In Colorado, we estimated that the federal share of costs for the
           Mason Gulch Fire would have been about $200,000 more and the
           nonfederal share that much less under an acres-burned method.

           Current Cost-Sharing Framework Raises Several Concerns
			  
			  Federal and nonfederal agency officials we interviewed raised a
           number of concerns about the current cost-sharing framework.
           First, some federal officials said that because master agreements
           and other policies do not provide clear guidance about which
           cost-sharing methods to use, it has sometimes been difficult to
           obtain a cost-sharing agreement that they believe shares
           suppression costs equitably. Second, nonfederal officials were
           concerned that the emergence of alternative cost-sharing methods
           has caused nonfederal entities to bear a greater share of fire
           suppression costs than in the past. Finally, some federal
           officials expressed concern that the current framework for sharing
           costs insulates state and local governments from the cost of
           protecting the wildland-urban interface, thereby reducing their
           incentive to take steps that could help mitigate fire risks and
           reduce suppression costs in the wildland-urban interface. We
           believe these concerns may reflect a more fundamental issue-that
           is, that federal and nonfederal entities have not clearly defined
           their financial responsibilities for wildland fire suppression,
           particularly for the wildland-urban interface.

           Lack of Clear Guidance Can Lead to Difficulties in Sharing Costs
			  
			  Some federal officials said that the lack of clear guidance can
           make it difficult to agree to use a cost-sharing method that they
           believe equitably distributes suppression costs between federal
           and nonfederal entities, particularly for fires that threaten the
           wildland-urban interface. As discussed, different cost-sharing
           methods were used for the two fires we reviewed in Utah, even
           though both fires required substantial suppression efforts to
           protect the wildland-urban interface. A federal official said that
           because of the state officials' unwillingness to use a method
           other than acres burned on one of the fires and because of the
           lack of clear guidance about which cost-sharing method should be
           used, he agreed to use an acres-burned method and did not seek a
           cost-sharing agreement that would have assigned more of the costs
           to the nonfederal entities. Some federal officials in Arizona
           expressed similar views, saying that the lack of clear guidance on
           sharing costs can make it difficult to reach agreement with
           nonfederal officials. For example, federal and state officials in
           Arizona did not agree on whether to share costs for one fire we
           reviewed in that state.

           Officials from the Forest Service's and the Department of the
           Interior's national offices agreed that interagency policies for
           cost sharing could be clarified to indicate under what
           circumstances particular cost-sharing methods are most
           appropriate. They said that the acres-burned method, for example,
           is likely not the most equitable method to share costs in cases
           where fires threaten the wildland-urban interface. Officials noted
           that the National Fire and Aviation Executive Board-made up of the
           fire directors from the five federal land management agencies and
           a representative from the National Association of State
           Foresters-was developing a template for both master and
           cost-sharing agreements. As of May 2006, this template had not
           been finalized, but our review of a draft version indicated that
           the template might not provide additional clarity about when each
           cost-sharing method should be used.

           Concerned about Increased Costs and Equity among States
			  
			  While federal officials expressed the need for further guidance on
           how to share costs, nonfederal officials were concerned that the
           emergence of alternative cost-sharing methods was leading state
           and local entities to bear a greater share of suppression costs
           than in the past, and they questioned whether such an increase was
           appropriate. Nonfederal officials also said that wildland fire
           suppression costs already posed budgetary challenges for state and
           local entities and that using alternative cost-sharing methods
           more often could exacerbate the situation. State officials said
           that if a state's suppression costs in a given year exceed the
           funds budgeted, they must seek additional state funds, which can
           be difficult. Moreover, they said, in many states, protecting
           structures is primarily a local responsibility, and many local
           entities are unable to pay the costs of fighting a large fire that
           threatens the wildland-urban interface.7 Although clarifying
           guidance about which cost-sharing methods are most appropriate for
           particular circumstances could cause nonfederal entities to bear
           more wildland fire suppression costs, over the long term, such
           clarification would also allow each entity to better determine its
           budgetary needs and take steps to meet them.

           In addition to their concerns about increased costs, nonfederal as
           well as federal officials were concerned that the federal
           government was treating nonfederal entities in different states
           differently, thereby creating inequities. Federal and nonfederal
           officials said that because some states use particular
           cost-sharing methods more often than other states, the proportion
           of costs borne by federal and nonfederal entities likely varies
           from state to state, resulting in nonfederal entities' paying a
           higher proportion of costs in some states and a lower proportion
           in other states. Clarifying which cost-sharing methods should be
           used in particular situations could increase nonfederal officials'
           assurance that the federal government is treating them equitably
           relative to other states.

           Cost-Sharing Framework May Reduce Incentives to Mitigate Fire Risks 
			  in the Wildland-Urban Interface
			  
			  Federal officials said that the current cost-sharing framework
           insulates state and local governments from the cost of protecting
           the wildland-urban interface. As we have previously reported, a
           variety of protective measures are available to help protect
           structures from wildland fire including (1) reducing vegetation
           and flammable objects within an area of 30 to 100 feet around a
           structure and (2) using fire-resistant roofing materials and
           covering attic vents with mesh screens.8 However, some homeowners
           and homebuilders resist using these protective measures because
           they are concerned about aesthetics, time, or cost. As a result,
           federal and nonfederal officials said, it can be politically
           difficult for state and local governments to adopt-and
           enforce-laws requiring such measures, and many at-risk areas have
           not done so. The states and communities we visited exhibited
           various degrees of progress in adopting laws requiring protective
           measures. For example, California requires homeowners in the
           wildland-urban interface to maintain 100 feet of defensible space
           and, in areas at particularly high risk from wildland fires, also
           requires new structures to be constructed with fire-resistant
           roofing materials and vents. The other states we visited do not
           have such statewide requirements, but they are taking a variety of
           steps to require or encourage protective measures. For example,
           Utah passed a law in 2004 requiring its counties to adopt
           standards for landscaping and building materials if they want to
           be eligible to receive state funds to assist with fire suppression
           costs. Other counties had efforts underway to educate homeowners
           about measures they could use to reduce their risk without
           requiring that such measures be used.

           Federal officials expressed concern-and some nonfederal officials
           acknowledged-that the use of cost-sharing methods that assign more
           costs to federal entities, and the availability of federal
           emergency assistance, insulate state and local governments from
           the cost of providing wildland fire protection. These federal
           officials pointed out that wildland fires threatening structures
           often require added suppression efforts. Under some cost-sharing
           methods, such as acres burned, federal entities often end up
           paying a large proportion of the costs for these efforts. Some
           federal and nonfederal officials also noted that the availability
           of FEMA assistance to nonfederal entities-which can amount to 75
           percent of allowable fire suppression costs for eligible
           fires-further insulates state and local governments from the cost
           of protecting the wildland-urban interface. Of the eight fires
           included in our review, nonfederal officials were seeking
           reimbursement for the allowable costs of the five fires that FEMA
           determined met eligibility requirements. Federal officials
           suggested that to the extent that state and local governments are
           insulated from the cost of protecting the wildland-urban
           interface, these governments may have a reduced incentive to adopt
           laws requiring homeowners and homebuilders to use protective
           measures that could help mitigate fire risks. Some officials said
           that by requiring homeowners and homebuilders to take such
           measures, more of the cost of protecting the wildland-urban
           interface would then be borne by those who chose to live there.

           Officialsï¿½ Concerns May Reflect Ambiguity over Financial 
			  Responsibilities
			  
			  On the basis of our review of previous federal reports and
           interviews with federal and nonfederal officials, we believe that
           the concerns we identified may reflect a more fundamental
           issue-that federal and nonfederal firefighting entities have not
           clearly defined their fundamental financial responsibilities for
           wildland fire suppression, particularly those for protecting the
           wildland-urban interface. Federal officials said that the
           continuing expansion of the wildland-urban interface and rising
           fire suppression costs for protecting these areas have increased
           the importance of resolving these issues. Federal wildland fire
           management policy states that protecting structures is the
           responsibility of state, tribal, and local entities; but the
           policy also says that, under a formal fire protection agreement
           specifying the financial responsibilities of each entity, federal
           agencies can assist nonfederal entities in protecting the exterior
           of structures threatened by wildland fire. Federal and nonfederal
           officials agreed that federal agencies can assist with such
           actions, but they did not agree on which entities are responsible
           for bearing the costs of these actions. Federal officials told us
           that the purpose of this policy is to allow federal agencies to
           use their personnel and equipment to help protect homes but not to
           bear the financial responsibility of providing that protection.
           Nonfederal officials, however, said that these actions are
           intended to keep a wildland fire from reaching structures, and
           financial responsibility should therefore be shared between both
           federal and nonfederal entities.

           Further, the presence of structures adjacent to federal lands can
           substantially alter fire suppression strategies and raise costs. A
           previous federal report and federal officials have questioned
           which entities are financially responsible for suppression actions
           taken on federal lands but intended primarily or exclusively to
           protect adjacent wildland-urban interface. Fire managers typically
           use existing roads and geographic features, such as rivers and
           ridgelines, as firebreaks to help contain wildland fires. If,
           however, homes and other structures are located between a fire and
           such natural firebreaks, firefighters may have to construct other
           firebreaks and rely more than they otherwise would on aircraft to
           drop fire retardant to protect the structures, thereby increasing
           suppression costs. Nonfederal officials in several states,
           however, questioned the appropriateness of assigning to nonfederal
           entities the costs for suppression actions taken on federal lands.
           These officials, as well as officials from the National
           Association of State Foresters, said that accumulated fuels on
           federal lands is resulting in more severe wildland fires and
           contributing to the increased cost of fire suppression. They also
           said that federal agencies are responsible for keeping wildland
           fires from burning off federal land and should, therefore, bear
           the costs of doing so. Federal officials in the states we visited
           recognized this responsibility, but some also said that with the
           growing awareness that wildland fires are inevitable in many parts
           of the country, policy should recognize that wildland fires will
           occur and are likely to burn across jurisdictional boundaries. In
           their view, those who own property in areas at risk of wildland
           fires share a portion of the financial responsibility for
           protecting it. Previous federal agency reports also have
           recognized this issue and have called for clarifying financial
           responsibility for such actions.

           Conclusions
			  
			  Wildland fires are inevitable and will continue to affect both
           federal and nonfederal lands and resources. Federal, state, and
           local firefighting entities have taken great strides to develop a
           cooperative fire protection system so that these entities can
           effectively work together to respond to these fires. Efforts are
           now needed to address how to best share the costs of these
           cooperative fire protection efforts when the fires burn or
           threaten multiple jurisdictions, particularly when suppression
           efforts may focus more heavily on one entity's lands and
           resources. The need for clear guidance on when to use a particular
           cost-sharing method is becoming more acute as the wildland-urban
           interface continues to grow and wildland fire suppression costs
           continue to increase. Before such guidance can be developed,
           however, federal and nonfederal entities must agree on which
           entity is responsible for the costs of protecting areas where
           federal and nonfederal lands and resources are adjacent or
           intermingled, particularly in the wildland-urban interface.
           Without explicit delineation of financial responsibilities,
           federal and nonfederal entities' concerns about how these costs
           are shared are likely to continue.

           Thus, to strengthen the framework for sharing wildland fire
           suppression costs, we recommended that the Secretaries of
           Agriculture and the Interior, working in conjunction with relevant
           state entities, provide more specific guidance as to when
           particular cost-sharing methods should be used and clarify the
           financial responsibilities for suppressing fires that burn, or
           threaten to burn, across multiple jurisdictions.

           In responding to our report, the Forest Service and the Department
           of the Interior generally agreed with the findings and
           recommendations. The National Association of State Foresters did
           not agree, stating that developing national guidance would not
           provide the flexibility needed to address the variability in local
           circumstances and state laws. Although we agree that a certain
           amount of flexibility is needed, without more explicit guidance to
           assist local federal and nonfederal officials responsible for
           developing cost-sharing agreements for individual fires, the
           inconsistencies in how suppression costs are shared within and
           among states are likely to continue, along with concerns about
           perceived inequities.

           Mr. Chairman, this concludes my prepared statement. I would be
           pleased to answer any questions that you or other Members of the
           Subcommittee may have at this time.

           GAO Contact and Staff Acknowledgments
			  
			  For further information about this testimony, please contact me at
           (202) 512-3841 or [email protected] , or Robin M. Nazzaro at (202)
           512-3841 or [email protected]. David P. Bixler, Assistant Director;
           Jonathan Dent; Janet Frisch; and Richard Johnson made key
           contributions to this statement.

           GAOï¿½s Mission
			  
			  The Government Accountability Office, the audit, evaluation and
           investigative arm of Congress, exists to support Congress in
           meeting its constitutional responsibilities and to help improve
           the performance and accountability of the federal government for
           the American people. GAO examines the use of public funds;
           evaluates federal programs and policies; and provides analyses,
           recommendations, and other assistance to help Congress make
           informed oversight, policy, and funding decisions. GAO's
           commitment to good government is reflected in its core values of
           accountability, integrity, and reliability.

           Obtaining Copies of GAO Reports and Testimony
			  
			  The fastest and easiest way to obtain copies of GAO documents at
           no cost is through GAO's Web site ( www.gao.gov ). Each weekday,
           GAO posts newly released reports, testimony, and correspondence on
           its Web site. To have GAO e-mail you a list of newly posted
           products every afternoon, go to www.gao.gov and select "Subscribe
           to Updates."

           Order by Mail or Phone
			  
			  The first copy of each printed report is free. Additional copies
           are $2 each. A check or money order should be made out to the
           Superintendent of Documents. GAO also accepts VISA and Mastercard.
           Orders for 100 or more copies mailed to a single address are
           discounted 25 percent. Orders should be sent to:

           U.S. Government Accountability Office 441 G Street NW, Room LM
           Washington, D.C. 20548

           To order by Phone: Voice: (202) 512-6000 TDD: (202) 512-2537 Fax:
           (202) 512-6061

           To Report Fraud, Waste, and Abuse in Federal Programs
			  
			  Contact:

           Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail:
           [email protected] Automated answering system: (800) 424-5454 or
           (202) 512-7470

           Congressional Relations
			  
			  Gloria Jarmon, Managing Director, [email protected] (202) 512-4400
           U.S. Government Accountability Office, 441 G Street NW, Room 7125
           Washington, D.C. 20548

           Public Affairs
			  
			  Paul Anderson, Managing Director, [email protected] (202)
           512-4800 U.S. Government Accountability Office, 441 G Street NW,
           Room 7149 Washington, D.C. 20548

5Under its Fire Management Assistance Grant Program, FEMA provides
financial assistance to nonfederal entities for the mitigation,
management, and control of any fire on public or private forest land or
grassland that would constitute a major disaster. Under this program,
nonfederal entities can be reimbursed for 75 percent of the allowable fire
suppression costs. FEMA evaluates the threat posed by a fire or fire
complex according to the following criteria: (1) threat to lives and
improved property, including threats to critical
facilities/infrastructure, and critical watershed areas; (2) availability
of state and local firefighting resources; (3) high fire danger
conditions, as indicated by nationally accepted indexes such as the
national fire danger ratings system; and (4) potential major economic
impact.

6Specifically, the state official said that under Arizona law, the state
had no responsibility to protect the private lands and resources in the
wildland-urban interface threatened by the Florida Fire because the fire
did not threaten state lands, and the private properties that the fire
threatened were not covered by cooperative fire agreements with the state.

7Some states have provisions whereby wildland fires exceeding the logistic
and financial capabilities of local entities can be managed and paid for
by the state, but officials said that state funds to do so are also
limited.

8GAO, Technology Assessment: Protecting Structures and Improving
Communications during Wildland Fires, GAO-05-380  (Washington, D.C.: Apr.
26, 2005).


(360732)

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
work may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this material
separately.

www.gao.gov/cgi-bin/getrpt? GAO-06-896T .

To view the full product, including the scope

and methodology, click on the link above.

For more information, contact Robert A. Robinson at (202) 512-3841 or
[email protected].

Highlights of GAO-06-896T , a testimony before the Subcommittee on Public
Lands and Forests, Committee on Energy and Natural Resources, U.S. Senate

June 21, 2006

WILDLAND FIRE SUPPRESSION

Better Guidance Needed to Clarify Sharing of Costs between Federal and
Nonfederal Entities

Wildland fires can burn or threaten both federal and nonfederal lands and
resources, including homes in or near wildlands, an area commonly called
the wildland-urban interface. Agreements between federal and nonfederal
firefighting entities provide the framework for working together and
sharing the costs of fire suppression efforts. GAO was asked to (1) review
how federal and nonfederal entities share the costs of suppressing fires
that burn or threaten both of their lands and resources and (2) identify
any concerns that these entities may have with the existing cost-sharing
framework. This testimony is based on GAO's May 2006 report Wildland Fre
Suppression: Lack of Cear Guidance Raises Concerns aboutCost Sharing
beween Federal and Nonfederal Entities (GAO-06-570).

What GAO Recommends

In its report, GAO recommended that the Secretaries of Agriculture and the
Interior, working with relevant state entities, provide more specific
guidance on when to use particular cost-sharing methods and clarify the
financial responsibilities for fires that burn or threaten to burn across
multiple jurisdictions. The Forest Service and Interior generally agreed
with the recommendations but the National Association of State Foresters
disagreed, stating that the recommendations would not provide the
flexibility needed to address the variability in local circumstances and
state laws.

Federal and nonfederal entities used a variety of methods to share the
costs of fighting wildland fires affecting both of their lands and
resources. Cooperative agreements between federal and nonfederal
firefighting entities-which are developed and agreed to by the entities
involved-provide the framework for cost sharing and typically list several
cost-sharing methods available to the entities. The agreements GAO
reviewed, however, often lacked clear guidance for federal and nonfederal
officials to use in deciding which method to apply to a specific fire. As
a result, cost-sharing methods were applied inconsistently within and
among states, even for fires with similar characteristics. For example,
GAO found that in one state, the costs for suppressing a large fire that
threatened homes were shared solely according to the proportion of acres
burned within each entity's area of fire protection responsibility, a
method that traditionally has been used. Yet, costs for a similar fire
within the same state were shared differently. For this fire, the state
agreed to pay for certain aircraft and fire engines used to protect the
wildland-urban interface, while the remaining costs were shared on the
basis of acres burned. In contrast to the two methods used in this state,
officials in another state used yet a different cost-sharing method for
two similar large fires that threatened homes, apportioning costs each day
for personnel, aircraft, and equipment deployed on particular lands, such
as the wildland-urban interface. The type of cost-sharing method
ultimately used is important because it can have significant financial
consequences for the entities involved, potentially amounting to millions
of dollars.

Both federal and nonfederal agency officials raised a number of concerns
about the current cost-sharing framework. First, some federal officials
were concerned that because guidance is unclear about which cost-sharing
methods are most appropriate in particular circumstances, it can be
difficult to reach agreement with nonfederal officials on a method that
all parties believe distributes suppression costs equitably. Second, some
nonfederal officials expressed concerns that the emergence of alternative
cost-sharing methods is causing nonfederal entities to bear a greater
share of fire suppression costs than in the past. In addition, both
federal and nonfederal officials believed that the inconsistent
application of these cost-sharing methods has led to inequities among
states in the proportion of costs borne by federal and nonfederal
entities. Finally, some federal officials also expressed concern that the
current framework for sharing costs insulates state and local governments
from the increasing costs of protecting the wildland-urban interface.
Therefore, nonfederal entities may have a reduced incentive to take steps
that could help mitigate fire risks, such as requiring homeowners to use
fire-resistant materials and landscaping. On the basis of a review of
previous federal reports and interviews with federal and nonfederal
officials, GAO believes that these concerns may reflect a more fundamental
issue-that federal and nonfederal entities have not clearly defined their
basic financial responsibilities for wildland fire suppression,
particularly those for protecting the wildland-urban interface.
*** End of document. ***