Stewardship End Result Contracting (stewardship contracting) is a
relatively new tool that Congress gave to the U.S. Forest Service and
the Bureau of Land Management (BLM) for managing and restoring federal
lands. With stewardship contracting, the agency can more completely
address the total ecological needs of an area by using timber sale
contracts, service contracts, agreements, and new integrated resource
contracts—or any combination thereof. The agency can describe the "end
result" it wants to achieve in a certain area and its contractor can
then develop and implement a mutually agreed-upon plan to achieve that
goal. Stewardship contracting also allows the agency to enter into
multi-year contracts and to use the value of any products removed and
sold as a by-product of the restoration or maintenance work to offset
some or all of the costs of the work. Finally, with stewardship
contracting, the agency can work with the local community to design and
implement the contract, and in the process, build community capacity
and bring jobs and income into the local community.
Key Concepts
Stewardship Demonstration (Pilot) Projects
While the idea of stewardship contracting emerged in the late 1970s and
early 1980s, stewardship contracting officially started when Congress
passed legislation in 1998 that allowed the U.S. Forest Service to
create 28 stewardship contracting demonstration projects, often called
"pilot projects." Congress later increased the number to 56, and then
84, but the pilot program was intended to be a short-term, experimental
program. All of the contracts for the demonstration projects had to be
let by 2004.
The pilot projects were intended to test whether several new
contracting authorities would help the Forest Service do its work
better and more
efficiently. In the pilot projects, the Forest Service could bundle
together, in one contract, a number of different activities designed to
restore or maintain ecosystem health. Projects included watershed
restoration, removing roads to decrease sedimentation into streams,
reducing fire risk by thinning forests, improving wildlife habitat, and
reducing noxious weeds. In the pilot projects, the Forest Service
combined some of their standard contracting methods (timber and service
contracts) with some new authorities (e.g., exchange of goods for
services, receipt retention, and best-value contracting) to do the
work. In addition to testing whether the new authorities were useful,
the pilot projects were supposed to test whether communities would
benefit from use of the new authorities. Advocates of stewardship
contracting expected that communities would participate in designing
and monitoring stewardship projects, and that local contractors would
do much of the work. Each pilot project had to be monitored and
evaluated by a multi-party monitoring team, and the results reported
annually to Congress.
Semi-Permanent Stewardship Contracting Authority
In February 2003, Congress significantly expanded stewardship
contracting. In that legislation, Congress changed stewardship
contracting from a limited, U.S. Forest Service demonstration project
to a semi-permanent authority that can be used by both the Forest
Service and the Bureau of Land Management (BLM) in their day-to-day
work. That legislation allows the agencies to enter into an unlimited
number of stewardship contracts over the next 10 years. The new law
explicitly allows the agencies to use stewardship contracts to achieve
a broad range of land management goals for the national forests and the
public lands that meet local and rural community needs. Projects can
include the removal and sale of timber or other commercially valuable
products, so long as the collection of money is secondary to achieving
the land management objectives. The law requires agencies to use
multi-party monitoring to evaluate projects, but the monitoring does
not have to evaluate each project.
For a map and brief description of current stewardship contracts, click here.
Agency Guidance for Implementing Stewardship Contracting
The 2003 legislation changed stewardship contracting from a limited,
demonstration program into a semi-permanent authority, but the way that
it is implemented in the long run could depend a great deal on the
agencies' guidelines. Agencies cannot generally be forced to follow
their own guidelines, but the guidelines set the tone for how the law
will be implemented in the field.
The BLM and Forest Service guidance documents cover:
- agency roles and responsibilities;
- project goals and objectives;
- planning of projects;
- contracting mechanisms;
- selecting contractors;
- applying new contracting authorities;
- bonding;
- funding of projects;
- monitoring and collaboration; and
- reporting requirements.
The Forest Service published revised guidelines in its Renewable Resources Handbook 2409.19, Chapter 60 in December 2005.
In January 2009, Forest Service Acquisition Management, Grants and Agreements, Timber Management, Stewardship Contracting staffs, and partner representatives met to draft national policy to increase the agency’s use of stewardship agreements. The stewardship agreement policy includes the following key elements:
- Partner’s contributions may include cash, real or personal property, services, and/or in-kind contributions, such as volunteer labor (funds from other Federal agencies many not be used unless specified by the Federal statute authorizing these funds).
- Each stewardship agreement must be negotiated on its own merits.
- The stewardship authority does not require a matching contribution; however, for the project to be defined as an agreement, the partner should contribute at least 20 percent of total project costs.
- If Supplemental Project Agreements are used - the 20 percent requirement applies to each one.
- Partner indirect costs can be counted as part of their contribution as long as there are other substantial contributions to the on-the-ground project.
- Partner may begin accumulating costs that can be used towards their non-cash cost-share when they receive project approval from the Regional Forester. Costs accrued prior to written notification cannot be attributed to the partner’s cost-share.
- Regional Forester must approve any SPA that does not meet the 20% matching contribution requirement.
More recently, the Forest Service proposed a a major change to the Forest Service fiscal year 2011 budget that would delete timber sales as a discrete line item. Instead the budget would combine timber sales with spending for vegetation and watershed management and wildlife and fisheries management to forge a new forest restoration line item. Stewardship contracting would become the primary means of implementing the restoration contracts.
BLM released its guidelines as an employee Instruction Memorandum.
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Click here to download report.
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Process Essentials: New Stewardship Contracting Authorities
Stewardship contracting gives the U.S. Forest Service and the Bureau of Land Management (BLM) new
authorities or rules for managing their lands. The principal new authorities the agencies can use
for stewardship projects are:
- Exchange of goods for services: Contractors can be paid in goods—with the value of any
timber or other forest products removed by the contractor used to offset what the agency owes the
contractor for services performed.
- Receipt retention: Excess receipts from the sale of timber or other forest
products removed can be kept and used by the agency, rather than being deposited in the U.S.
Treasury.
- Best-value contracting: Contracts must be awarded on the basis
of achieving best value to the government. A variety of criteria, in addition to price, can be used
in making the award determination.
- Less than full and open competitive contracting: Stewardship contracts
can be awarded with little or no advertising or bidding.
- End-results contracting: The agency
determines the end result desired for the work, but the contractor has flexibility to propose the
methods to be used, including, in some instances, which individual trees to cut.
- Multi-year contracts: Service contracts can be let for up to 10 years, instead of the current 5 year maximum, to match the duration of timber
contracts.
- Non-Department of Agriculture administered contracts: Non-Department of Agriculture personnel can prepare and administer National Forest timber sales.
Exchange of Goods for Services
Generally, the Forest Service uses service contracts to arrange for
work like road closures or forest thinning and pays for the work with
money appropriated by Congress. However, because of increasing budget
constraints, the agency often struggles to find money to pay for
projects like watershed improvement and forest thinning. In general,
this kind of work cannot be done as part of a timber sale contract.
Under stewardship contracting, the agency can use some or all of the
value of commercial timber or other products removed by a contractor as
part of a stewardship project, to offset the costs of the conservation
services performed by the contractor on that project. For example, the
agency could give a contractor commercial timber (goods) in exchange
for removing non-commercial, small-diameter trees, improving watershed
conditions, or removing old roads (services). Goods for service
exchanges can provide the agency with funds outside of the budget
appropriations process. They also allow the agency to contract for a
comprehensive set of land treatments with fewer contractor and/or
equipment entries into a site.
The Forest Service has developed integrated resource contracts to
facilitate these exchanges. Contract templates are available on the Forest Service stewardship contracting web site.
Receipt Retention
In most cases, when the Forest Service or BLM enters into a contract,
any money earned (e.g., for commercial timber removed) must be
deposited in the U.S. Treasury. Before stewardship contracting, the
only major exception to this was for payments to trust funds and/or to
counties. With stewardship contracting, the Forest Service and BLM can
retain this money and reinvest it into stewardship projects.
- BLM guidelines provide that
the funds should, in general, be used to fund additional projects
within the state in which the funds were generated;
- Forest Service retained receipts
should be used in the same project area, but may be transferred to
another area if the transfer is identified in advance and approved by
the Regional Forester.
- Both agencies plan to used the funds
for programmatic-level multi-party monitoring and direct on-the-ground
implementation costs, but not for program planning, environmental
assessments, project-level monitoring, overhead, administrative or
indirect costs.
Best-Value Contracting
In a regular timber sale, a government agency has to award a contract to the
bidder offering the best (highest) price for the timber. But under stewardship contracting, the
Forest Service and BLM can consider other factors in deciding who wins the contract. For example,
they can take into account the contractor's past performance and the quality of the contractor's
past work, as well as the contractor's experience in doing the specific work called for in the
contract. With best-value contracting, the agency can award a contract to a bidder who offers to do
the work at a higher price than another contractor if the agency thinks that higher bidder would do
a better job. The agencies can also give some preference to bidders who will do local hiring and
purchasing, or ensure that value is added to some or all of the materials removed.
Less Than Full and Open Competitive Contracting
In order to promote full and open competition in contracting, the
National Forest Management Act required the Forest Service to advertise
and accept bids or proposals from all responsible contractors for all
timber sales valued at $10,000 or more. Stewardship contracts are
exempt from this requirement, so the agencies can offer stewardship
contracts, which include timber valued at more than $10,000, with less
than full and open competition. For example, the agency can sole-source
stewardship contracts or have a set-aside or preference for small
businesses. The agencies might want to use this authority to limit
competition or "sole source" contracts in order to increase investment
and employment in severely distressed areas or to help build new
restoration skills in a community. When the Forest Service wants to use
this authority, the Forest Supervisor must justify its use to the
Regional Forester.
End-Results Contracting
Rocky Mountain Elk Foundation Contracts to Manage Lands
A
2006 stewardship contract between BLM and the Forest Service and the
Elk Foundation placed about 260,000 acres in Elk Foundation hands for
10 years. The stewardship contract's main goal is to improve wildlife
habitat in the Blackfoot Clearwater Wildlife Management Area in Montana
and on BLM land near Pinedale, Wyoming. The conservation organization
will use timber harvesting and thinning to accomplish this stewardship
contracting goal.
Read more about this contract on the Rocky Mountain Elk Foundation web page.
End-results
contracting, also called "designation by description" or "designation
by prescription," seeks to reduce costs and promote innovation. It does
so by letting the agency describe the forest or ecosystem condition
that it wants to achieve (the "end-result") and then by giving the
contractor substantial flexibility in deciding how to reach that goal.
For a traditional timber sale, the Forest Service must not only decide
how much timber to cut, but must also mark individual trees to be
harvested or left, or describe the project in such a way that any two
contractors would harvest the same trees. Designation by description in
a stewardship contract might be to "remove all lodgepole pine with less
than a 10 inch stump diameter." An example of designation by
prescription, which describes the desired end result of the treatment,
would be to "retain 60 percent crown closure" during harvest. The
stewardship contractor must submit a plan of work specifying how she
would do the work to accomplish that end result. The Forest Service can
use designation by description or by prescription for any stewardship
contract, but Forest Service guidelines set limits on use of
designation by prescription for cutting commercial materials. In either
case, the agency would retain oversight over the projects and enforce
contract terms.
Multi-Year Contracts
Stewardship
contracts can be for a period of 10 years. This is the same length of
time allowed for traditional timber contracts, but longer than the
five-year limit for service contracts. Long-term contracts give the
agencies more flexibility in working toward a long-term goal for the
condition of the land. A longer-term contract can also provide some
assurance of a supply of product over a longer term, help the
contractor adjust to market conditions, and make longer-term jobs
available in the community.
Process Essentials: Changes in Stewardship Contracting
In changing from a demonstration program to a semi-permanent authority,
Congress made several changes in stewardship contracting. The major
legislative changes are:
Number and Duration (Term) of Potential Contracts
The Forest Service and BLM can enter into an
unlimited number of stewardship contracts or agreements through September 13, 2013. Because each
project can have up to a 10-year duration, they will all have to be completed by 2023. This differs
from the pilot project program that allowed for a maximum of 84 projects; all of which had to be
under contract by 2004 and completed by 2014.
Agencies That Can Use Stewardship Contracts
Forest Service Contracting:
2003-May 2006 Update
Both the Forest Service and BLM are now authorized to
use stewardship contracting. Only the Forest Service had authority to use stewardship contracting
under the pilot program.
Land Management Objectives
Stewardship contracting is intended to help the agencies achieve a
variety of land management goals. These goals emphasize land protection and restoration, rather than
resource extraction. Restoration goals include, but are not limited to:
- Road and trail maintenance
or obliteration to restore or maintain water quality;
- Protection or enhancement of soil
productivity;
- Setting of prescribed fires to improve the composition, structure, condition, and
health of stands or improve wildlife habitat;
- Watershed restoration and maintenance; restoration
and maintenance of wildlife and fish habitat; and
- Control of noxious and exotic weeds and re-establishing native plant species.
Whether there is any substantive
difference between the management goals allowed under the pilot program
and the semi-permanent authority is not clear. The legislation that
authorized the pilot projects provided only a "sample" list, not an
exhaustive list, of appropriate goals for stewardship projects.
Consequently, it was broad enough to let the Forest Service address
both restoration and non-restoration management goals in the pilots.
The law establishing the semi-permanent authority included almost the
same sample list of management goals, but also allows removal of
vegetation (for example through logging, chaining or herbicide
application) for both restoration purposes and for "other land
management objectives" as well. Collecting monies, e.g., for sale of
timber, must, however, be secondary to achieving land management goals.
Critics of stewardship contracting fear that this authority will lead
to abuse and projects that do not emphasize land restoration.
Supporters of stewardship contracting and the agencies emphasize that
the new authorities will focus on land stewardship and will not be used
as a substitute for timber contracts.
Monitoring and Evaluation
The Forest Service and BLM must evaluate their stewardship contracting projects through a
multi-party monitoring and evaluation process. Besides including the
agencies, the multi-party monitoring and evaluation process can include
other cooperating agencies, tribes, and any interested groups and
individuals. Monitoring and evaluation by a multi-party team can help
ensure that a broad range of interests are incorporated into and met by
stewardship projects.
For the pilot program, the Pinchot Institute for Conservation
coordinated a three-level (local, regional and national) monitoring
program to evaluate projects. Local involvement in pilots ranged from
minor involvement in projects developed primarily by the agency to
intense, on-going efforts by multi-party groups to create and monitor
projects.
The new stewardship contracting law only requires programmatic
monitoring, not individual project monitoring. Forest Service
guidelines recognize that monitoring is an important aspect of
stewardship contracting, and will encourage, but not require,
multi-party monitoring of individual projects. The BLM guidelines
direct staff to use multiparty monitoring, open to all interested
parties, to monitor and evaluate a representative sampling of projects.
The guidelines advise staff to conduct project level monitoring where
there is sufficient public interest and either funding or volunteers.
Both agencies will be evaluating collaboration and the role of local
communities and other stakeholders in the development of stewardship
contracting contracts and agreements. Pinchot is again coordinating the
multi-party monitoring.
Programmatic monitoring reports are available on the Forest Service Stewardship Contracting website.
Controversies
Stewardship contracting is extremely controversial. Both the original
pilot project legislation and the legislation expanding the program
were adopted as "riders" to appropriations legislation. As a result,
there were no hearings and congressional debate was limited.
SC supporters argue:
- Land restoration and maintenance goals of stewardship contracting are important;
- Tight budgets and traditional constraints on how the agencies
can spend money often mean that agencies do not have enough funding to
accomplish all of their land maintenance and restoration needs; and
- Stewardship contracts can supplement and help diversify employment opportunities in rural forest communities.
SC critics recognize some of these benefits, but contend:
- Stewardship contracts give the U.S. Forest Service, and now BLM, too much discretion;
- Congress is just trying to find new ways to cut timber; and
- Contractors will have too much discretion—and perverse
incentives with goods-for-services exchanges—to remove large,
ecologically important trees to pay for activities which are not
economically viable.
Collaboration in Action
The new law establishing stewardship contracting does not use the word
"collaboration," but it was clear from the controversy surrounding the
pilot projects that collaborative planning, implementation and
monitoring of projects was extremely important to the communities that
the legislation was intended to benefit. Both Forest Service and BLM
have responded to communities in their implementation guidelines by
directing agency staff to use collaborative processes in developing and
implementing stewardship contracts. BLM guidelines call for using an
open, collaborative process to identify local and rural community
needs. BLM guidelines also encourage staff to seek early involvement of
tribal governments and local government agencies, and any interested
groups or individuals in various phases of project development and
implementation. In particular, the guidelines direct managers to
consult with the public and interested stakeholders early in the
collaborative process for input on how excess funds generated by
projects could be used.
Similarly, Forest Service guidelines direct district rangers to develop
stewardship contracting projects in collaboration with tribal
governments, local governments, non-government organizations,
individuals, other groups, and communities. For example, the agency
should choose the authorities to be used in implementing the projects,
in part, based on feedback from community collaboration. Forest Service
guidelines provide that projects should have considerable local
support—as evidenced by the involvement of communities—if they are to
be implemented as stewardship contracts. What is considered to be the
"local community" for purposes of collaboration and letting best value
contracts will vary from project to project and is ultimately the
decision of the district ranger.
As contracts are implemented, BLM and the Forest Service will work
together on a multi-party process for evaluating and reporting on
collaboration and the role of local communities and other external
stakeholders in the development of the contracts and agreements. Both
agencies allow the use of funds generated through the projects to fund
the collaborative process used for the programmatic-level multi-party
monitoring.
For details on collaboration within the pilot projects and the new stewardship contracting projects, see www.healthyforests.gov/initiative/map.html
For a General Accounting Office critique of community involvement in stewardship contracting see www.gao.gov/new.items/d04652.pdf.
Beaverhead-Deerlodge Partnership: Stewardship Contracts in a Larger ContextIllustrating the potential for an unlikely coalition, loggers and wilderness advocates in Montana have come up with
their own alternative in a forest planning process. Their alternative
proposes to use stewardship contracts on a large scale. Click here
to view the Partnership's web site, which includes a discussion of the
process by which they brought this idea to the Forest Service planning
process and have worked with Mont. Sen. Jon Tester to introduce
legislation including the proposal.
The Partnership has generated a great deal of controversy, including
opposition from both ends of the ideological spectrum. See, e.g., "The Beaverhead-Deerlodge Partnership: Right Idea, Wrong Bill," NewWest.net commentary by Bill Schnieder, 11/28/08. and the statement of the Montanans for Multiple Use. For a more detailed treatment of the proposal and its legislative prospects, see "Taking control of the machine: environmentalists and timber companies push big experiments in national forests," High Country News, 7/20/09.
For a description of the bill that includes this proposal, see "Tester unveils forest plan," Missoulian, 7/18/09.
Legislation in the 111th Congress
The American Recovery and Reinvestment Act (ARRA) of 2000 (P.L. 111-5) contains language that affects matching contribution
requirements under several types of grants and agreements entered into
for ARRA-approved programs, including stewardship contracts:
-
Title VII Wildland Fire Management of the ARRA exempts funds for
activities on state and private lands from the statutory matching or
cost share requirements.
-
Under ARRA, the funds provided for activities on state and private lands
are not subject to matching or cost share requirements.
-
Flexibility should be exercised in negotiating matching requirements in
partnership agreements awarded for ARRA-approved projects
Links
Public Laws
Stewardship End Result Contracting Projects Legislation
Section 323 of Public Law 108-7, 16 USC section 2104
READ MORE >>
Federal Agencies and Contractors
USDA Forest Service Stewardship Contracting
Two Forest Service websites include text of the applicable legislation,
implementation guidelines, Washington office and regional SC
coordinators, a list of pilot projects, various reports, and links to
other web sites of interest.
USDA FOREST SERVICE SITE >>
HEALTHYFORESTS.GOV >>
Land Stewardship Demonstration Contracts, USDA Forest Service Northern Region
This web site includes information on all Forest Service Region 1
stewardship pilot projects, general information on stewardship
contracting, text of legislation, links to sample contracts and other
forms, information on northern region meetings, and links to other
useful stewardship contracting web sites.
READ MORE >>
BLM Guidance for Stewardship Contracting
Instruction Memorandum 2004-081
READ MORE >>
Pinchot Institute for Conservation Stewardship Contracting
Pinchot's web site includes a wide range of descriptive and resource
material on stewardship contracting, including a brief history, a
description of the multi-party monitoring process, descriptions of
individual pilot projects and links to their monitoring reports.
READ MORE >>
Other Resources
WestCAN
The Western Collaborative Assistance Network promotes collaborative approaches to natural resource management conflicts by providing a range of expertise to help collaborative efforts get started, work through challenging issues, and demonstrate progress. Resources include a resource library, technical assistance and links to peer coaches.
Ecosystem Workforce Project
Founded in 1994, the Ecosystem Workforce Program (EWP) was created to
help lead the rural Pacific Northwest into the age of ecosystem
management—management for healthy communities and healthy environments.
The EWP web site includes information on their projects, a
variety of EWP and other relevant publications, and links to their
partner organizations.
READ MORE >>
The EWP web site also includes A Guidebook for Multiparty Monitoring for Sustainable Natural Resource Management. The Guidebook is
designed to help communities and their agency partners monitor activities related to ecosystem management and community-based
forestry, especially the National Fire Plan, and offers suggestions about how to develop a multiparty monitoring program.
READ MORE >>
American Forests
American Forests is a national organization that works on a variety of forestry issues. American Forests assists the Pinchot
Institute with national policy issues regarding stewardship contracting and the development of informational materials and
events to proactively engage distant stakeholders in stewardship pilot efforts and "lessons learned" symposia.
READ MORE >>
American Lands
American Lands Alliance, formerly the Western Ancient Forest Campaign,
represents citizens nationwide who are working to protect wildlife
and wild places. Its web site includes a detailed criticism of
stewardship contracting.
READ MORE >>
Sustainable Northwest
For links to a variety of resources on stewardship contracting,
including training manuals, forms and handbooks, see the Sustainable
Northwest website.
READ MORE >>
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