Extremely poor financial management at the U.S. Forest Service threatens the vitality of the forests, witnesses testified at a series of hearings this week before the House Subcommittee on Government Management, Information and Technology.
USFS representatives said they are taking drastic measures to remedy the problems.
"The depth of the Forest Service's accounting deficiencies is so extraordinary that even the most fundamental principles, like double-entry bookkeeping--first set forth in writing by the Venetian Monk Luca Pacioli in 1494--are not always honored," Agriculture Department inspector general Roger Viadero testified.
Subcommittee Chairman Rep. Stephen Horn, R-Calif., held the hearings Tuesday in Bellflower, Calif., and Thursday in Wenatchee, Wa.
Poor record-keeping, outdated financial systems and program mismanagement have all contributed to the Forest Service's difficulties, said Linda Calbom of the General Accounting Office.
GAO studies have found that the agency failed to account for $215 million of its fiscal 1996 operating budget and that USFS reports of $7.8 billion in property and equipment were erroneous because records for the assets were not documented or updated.
The Forest Service, GAO reported, has also failed to properly administer its Knutson-Vandenberg Trust Fund, which funds the reforestation of timber harvest areas. Between 1990 and 1996, $645 million was unlawfully transferred from the K-V Fund to pay for general administration and overhead and never reimbursed, Calbom said.
Ronald Stewart, USFS deputy chief of programs and legislation, admitted the agency's mistakes, saying "we know that we have a lot of work to do to correct business systems and to be more accountable to the public for our actions."
Stewart said the agency plans a major restructuring of its business operations and will hire a chief financial officer. Also, USFS is implementing an integrated accounting system called the Foundation Financial Information System, which will enable policy makers and supervisors to assess the costs of certain activities.
In addition, the agency will establish a business team to review its financial systems and recommend improvements.
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