Logging in National Forests Costs Taxpayers

by Jeff Elliott

The U.S. spent over $1.6 billion to help log the national forests	Between 1992 and 1994, the federal government spent over $1.6 billion to assist timber companies logging in the national forests, according to a GAO report issued last month, supporting environmentalists who have long claimed that there is little economic benefit from plundering the public-owned woodlands and parks. In forests found in some states, including California, Arizona, and New Mexico, there is no profit at all, and the government loses tens of millions each year to subsidize logging in these areas. Work by Forest Service employees included construction and maintaining logging roads, cleanup after cutting, erosion control, reforestation for benefit of future logging, and administration of timber plans.
From payments made by timber companies, only about ten cents of every dollar went to the U.S. Treasury	These funds came from $2.9 billion paid to the government by timber companies during the same period -- a considerable sum cited by industry supporters as a deficit-reducing benefit of logging. But after deducting expenses used to support the industry, only about one-tenth, or $303.7 million, was actually paid to the federal treasury. Requirements of different laws, some as old as 1908, demand set-asides to promote logging. Roughly 12 percent goes to road-related purposes, including credits to timber companies who create their own logging trails. Another $555 million was used in this period for the "salvage sale fund," preparing and admistrating areas with dead or damaged trees. These monies can also be used for road building. For every dollar paid by timber companies to log in the national forests, more than 60 cents is spent by the government to build logging roads, repair damage, or other activities in support of further logging by the industry (Albion Monitor Graphic) By far the largest direct logging expense was reforestation, with $736 million spent in these three years. This type of replanting is criticized by environmentalists because a diverse, multi-layered forest is often replaced with a tree farm -- row upon row of tiny seedlings desirable for future timber harvests.
Logging jobs in many California and Southwestern forests are subsidized by taxpayers	Another law requires at least one-quarter of all receipts be paid to the state where the forest is located. In some counties of California, Washington, and Oregon, a "spotted owl guarantee" produces additional state payments to compensate for timber not logged because of environmental protections. As a result, most logging in California national forests actually costs the federal government millions of dollars per year, with no profit whatsoever. In the Mendocino National Forest last year, for example, the timber companies paid $1,286,865, while the government spent about three times that amount. As a result, the federal treasury lost nearly $3 million dollars in 1994 on this forest alone. The deficit was even worse in 1992, where $6.5 million was lost just on Mendocino. The largest deficit in Northern California occurred in 1993 with the Klamath Forest, leaving the government $12 million in the red. Over the last three years, Klamath Forest logging has cost the federal treasury nearly $30,000,000. While politicians often justify logging in national forests as needed to save jobs, an analysis of the GAO report reveals that these jobs are often subsidized by the taxpayers. Arizona and New Mexico also have sizable deficits, like California. With 650 loggers in theses national forests, the government paid nearly $72,000 per person over the three year period.

[Editor's note: Because this GAO report is difficult to find, we have a copy available for downloading. To read the document, you first must obtain the free Adobe Acrobat software for your computer.]

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