Proposed federal legislation that would require the U.S. Forest Service to spend more than half the money it receives from renting land to ski areas on approving ski-area developments and offsetting operator fees is drawing fire from government ethics watchdogs.
Colorado’s Rep. Scott Tipton (R) and New Hampshire’s Rep. Ann McLane Kuster (D) introduced the bill in the U.S. House while U.S. Sen. Cory Gardner (R-Colorado) sponsored a Senate version. U.S. Rep. Liz Cheney (R) is a co-sponsor of the House bill and U.S. Sens. Mike Enzi and John Barrasso, also Republicans, co-sponsored the senate version.
Tipton and Kuster — co-chairs of the House Ski and Snowboard Caucus — said in a statement that the current permitting system is “broken.” Bill supporters say the federal agency — its budget strapped from fighting wildfires — has been slow to authorize requests for new development on public lands.
The bills would “promote year-round recreation activities, infrastructure improvements, and expanded services for visitors through more efficient permitting,” the House sponsors’ statement issued in March said. The bill could dedicate up to $24 million for permit administration, they said. Avalanche information would be among the services supported by the earmarked funds.
A Forest Service watchdog group last week criticized the measures, however, saying they create inappropriate incentives for land managers.
An old mistake?
The bills create a bureaucratic conflict said Andy Stahl, executive director of Forest Service Employees for Environmental Ethics. They would give the Forest Service a financial interest in the outcome of a permit application — “a dog in the fight” — he said.
Instead, the agency and its bureaucrats should be “incentivized by the condition of the land, by the long-term land ethic,” he said. Decision makers should be guided by what’s best for the property owned by all Americans — beauty, ecological health and other such factors — “not what’s best for [their] budget,” he said.
“We oppose that bill on that principle,” Stahl told WyoFile.
Systems like the one proposed in the bills have proven untenable for the Forest Service in the past, Stahl said. He cited the “long history” of clear cutting and timber harvesting as the prime example.
From the 1940s through the late 1980s, Stahl said, timber sales financed most of the agency’s operations. The system came under attack by critics that said logging companies were getting cheap raw materials at the expense of the taxpayer and environment.
“That’s pretty much what’s proposed here,” he said of the Ski Area Fee Retention Act. The rental fees would go not to the U.S. Treasury but instead to the “day-to-day managers [as] direct payments.”
“It’s as if you worked in a shoe store and sold shoes on a commission basis,” Stahl said. “You, as a sales person, get a cut of every shoe you sold.
“That makes sense if the only goal is to sell shoes,” he said. “But if the goal is to balance the selling of shoes with the selling of dresses and the protection of the store environment, some of which don’t pay any money, you’ll end up with guys who just sell shoes and forget about everything else.”
Similarly, forest managers might be tempted to approve applications that would enrich their bureaucracies, even though individual employees would not benefit.
Lower costs and streamlined permitting
If passed, the bills would create a ski-area fee retention account into which at least 50 percent of ski area annual rental fees would be deposited. The amount would vary — climbing to as much as 65 percent on national forests that collect less than $15 million a year.
Under the proposed legislation, the fees would be used in the National Forest where they are generated. The Secretary of the Interior could reduce the amount available to a particular forest if he or she believed the sum exceeds “the reasonable needs” of that forest. The money could be shifted through the agency depending on the number of proposals for development, backlogs and other needs for service, according to the bills.
The money would be authorized for permit administration and the “processing of proposals for ski area improvement projects.” The bills also would reduce charges currently imposed on ski areas when they seek to develop — fees paid to the government through what’s known as a cost-recovery program.
That program requires special-use permit applications and permit holders to offset the administrative burden they place on the bureaucracy. The cost-recovery fees are separate from annual rental permit fees.
Under today’s law special-use permit applicants and permit holders must estimate what it costs “to process their applications or monitor their authorizations.” Cost-recovery fees are then based on the agency’s cost to review applications, conduct environmental analyses, visit locations, evaluate technical and financial qualifications and prepare documents.
Under the proposed Ski Area Fee Retention Act, the new, special account would cover “any expenses that the Forest Service would have otherwise applied to ski area permittees through cost recovery.”
The bill also would allow administrators to use the new account for interpretation and signage on Forest Service land and agency avalanche information and education. Once all ski-area needs are met, excess money could be used for permit administration for other non-ski-area recreation special-use permits.
The bill prohibits spending the special account on wildfire suppression or preparedness and monitoring of potential threatened or endangered species, unless required for review of ski area projects.
The special account shall supplement and not supplant a national forest’s normal operation and maintenance budgets, the bills say.
Wyoming ski areas generated $1.7 million
Annual ski area rental fees are calculated using a complicated formula that accounts for the amount of business conducted on federal property, among other things.
The ski area permit rental charge is calculated by first determining the percentage of lift service on public land. That percentage is then applied to lift ticket and ski school revenue. In bureaucratese, the formula so far would be (LT+SS) x STFP or lift ticket revenue plus ski school revenue times “slope transport feet percentage.”
The gross revenue of ski-area ancillary facilities on national forest land — restaurants, parking, lodging and such — is then added to the previous figure to arrive at adjusted gross revenue that is subject to the rental charge. For areas generating less than $3 million a year, a ski area would owe 1.5 percent of the adjusted gross revenue. That factor increases to 2.5 percent for ski areas making between $3 million and $15 million, to 2.75 percent for those between $15 million and $50 million, and to 4 percent for those with an adjusted gross revenue of more than $50 million.
Simply put the annual fee formula is ((LT + SS) × STFP) + GRAF = AGR; AGR × percentage brackets.
In FY 2017, Wyoming’s seven Forest Service ski areas — Jackson Hole Mountain Resort, Snow King Mountain, Grand Targhee Resort, White Pine, Snowy Range, Sleeping Giant and Antelope Butte — generated $1,773,755 under the formula. Neighboring Colorado’s 22 ski areas generated $26.2 million during the same period. Idaho’s 10 ski areas brought $798,798 to the U.S. Treasury while Montana’s 11 ski areas generated $654,804 according to information Wyofile obtained from the Forest Service through a Freedom of Information Act request.
The Forest Service refused to provide WyoFile with individual ski area fees, saying that information “is considered confidential business data.” Agency officials said that despite the complex fee formula, the agency determined that one can reverse-calculate proprietary business data using a ski area’s annual rental payment. Also, some industry members have opposed releasing the annual fee payments, they said.
None of the three Wyoming ski areas contacted by WyoFile for comment responded by press time.
The rejection of individual ski-area rental payments appears to differ from a Forest Service FOIA response earlier this year. In May, the Jackson Hole News&Guide, through a FOIA request, obtained from the Forest Service the permit fees paid by the Jackson Hole Mountain Resort, Snow King Mountain and Grand Targhee Resort — three ski areas in Teton County.
The paper sought to determine what operations at a ski area generated revenue. Such information could aid the Jackson Hole community as it weighs plans to expand the Snow King Mountain ski area above Jackson, reporter John Spina wrote at the time.
For example, Spina said, by understanding that restaurants generate more revenue than new ski terrain, community members could support some aspects of Snow King Mountain expansion over others. But the paper couldn’t reverse-calculate such figures, he said, and the resorts would not break down their revenues for the story.
In the story subtitled “Owners say slim margin argues for development that will boost revenue for the Town Hill,” Spina wrote that gross adjusted revenue for Jackson Hole Mountain Resort was 107 times greater than Snow King’s, “despite seeing just 15 times the number of skier days.”
Similarly, at Grand Targhee Resort on the west slope of the Tetons, adjusted gross revenue last winter was 14 times more than Snow King’s, the story said.