Statement of Forest Principles

We can resolve many of the controversies over federal forest management, including debates over land allocations, levels of timber and other outputs, and the preparation of individual timber sales and other projects.

Most of these controversies are traceable to a budgetary process that creates perverse incentives for managers, promotes divisiveness among users, and encourages central control of the agency by politicians instead of decentralized decisions by the managers on the ground.

To solve these problems, we support the following general principles for reforming federal forest management:

1. User Fees at Fair Market Value

Federal forest managers must be allowed to charge a broad range of user fees, including fees for recreation, at fair market value.

True multiple use requires multiple incentives. User fees for multiple resources will create those incentives. Current requirements that forests provide selected resources at below-market prices reduce the incentive for managers to care for those resources.

2. Fund Forests Out of Net Income

Federal forests must be funded out of the net income that they earn, not out of tax dollars.

Funding out of tax dollars encourages central planning and political manipulation. Funding out of user fees encourages management responsive to the needs of forest users. Funding out of net fees encourages managers to emphasize resources whose values are greater than their costs.

3. Biodiversity Trust Fund

A fixed percentage of gross receipts from federal forest users should be dedicated to public goods such as biodiversity.

A few resources, such as biodiversity, need more protection than can be provided by the incentives created by net receipts alone. Dedicating a share of all public forest user fees to a biodiversity trust fund will allow the managers of that trust fund to give public and private forest owners incentives to protect biodiversity and related resources. This will help assure protection of endangered species without coercion and with minimal economic effects.

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