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                                                       Calendar No. 529
105th Congress                                                   Report
                                 SENATE

 2d Session                                                     105-292
_______________________________________________________________________


 
        GRANITE WATERSHED ENHANCEMENT AND PROTECTION ACT OF 1998

                                _______
                                

                 August 25, 1998.--Ordered to be printed

   Filed under authority of the order of the Senate of July 31, 1998

  Mr. Murkowski, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 2886]

    The Committee on Energy and Natural Resources, to which was 
referred the Act (H.R. 2886) to provide for a demonstration 
project in the Stanislaus National Forest, California, under 
which a private contractor will perform multiple resource 
management activities for that unit of the National Forest 
System, having considered the same, reports favorably thereon 
with an amendment and recommends that the Act, as amended, do 
pass.
    The amendment is as follows:
    On page 2, line 23, strike ``prescribed burns.'' and insert 
in lieu thereof the following: ``prescribed burns in the 
Granite watershed.''

                                purpose

    H.R. 2886, as ordered reported, would authorize the 
Secretary of Agriculture to conduct a demonstration project in 
the Granite watershed in the Stanislaus National Forest, 
California, under which a private contractor will perform 
multiple resource management activities for a portion of that 
unit of the National Forest System.

                          background and need

    H.R. 2886, the Granite Watershed Enhancement and Protection 
Act of 1998, would permit the Forest Service to implement an 
innovative process to develop and carry out a comprehensive 
land management contract for the Granite watershed area, in the 
Stanislaus National Forest, California. The plan was developed 
by the Forest Service, together with local elected officials, 
forestry professionals and environmental advocates to improve 
forest health and water quality.
    In 1973, catastrophic fire burned approximately 17,000 
acres in the Stanislaus National Forest. Following the fire, 
re-planting did occur. However, due to budgetary limits, 
further restoration did not occur. This lack of management has 
resulted in poor water quality and an excess fuel load.
    H.R. 2886 allows the Forest Service to assign a group of 
multiple resource activities in the Granite watershed to a 
single contractor. Existing Federal contracting authority 
prohibits the Forest Service from offering a contract that 
bundles multiple resource activities. For example, if an area 
is in need of thinning,prescribed burning, and water quality 
monitoring, each of these would require separate contracts. Authorizing 
a single contractor to provide more than one service will eliminate 
duplication of effort by Forest Service staff, reduce unnecessary 
paperwork, and decrease preparation costs.

                          legislative history

    H.R. 2996 was introduced on November 7, 1997, by 
Congressman John Doolittle (R-CA). The bill was referred to the 
Committee on Resources, and within the Committee to the 
Subcommittee on Forests and Forest Health. On March 24, 1998, 
the Subcommittee held a hearing on H.R. 2886. On April 29, 
1998, the Committee on Resources reported H.R. 2886, as 
amended, to the House of Representatives by voice vote. H.R. 
2886 passed the House of Representatives by voice vote on May 
12, 1998.
    The Subcommittee on Forests and Public Land Management held 
a hearing on July 22, 1998. At the business meeting on July 29, 
1998, the Committee on Energy and Natural Resources ordered 
H.R. 2886, as amended, favorably reported.

            committee recommendation and tabulation of votes

    The Senate Committee on Energy and Natural Resources, in 
open business session on July 29, 1998, by unanimous voice vote 
of a quorum present recommends that the Senate pass H.R. 2886, 
if amended as described herein.

                          committee amendment

    The Committee amended H.R. 2886 to clarify that all of the 
resource management activities conducted by a private 
contractor pursuant to this bill will take place only within 
the Granite watershed area.

                      section-by-section analysis

    Section 1 entitles the Act the ``Granite Watershed 
Enhancement and protection Act of 1998.''
    Section 2(a) authorizes the Secretary of Agriculture to 
enter into a five year contract with a private contractor to 
perform multiple resource management activities on Federal 
lands in the Granite watershed, consisting of approximately 
8,000 acres, within the Stanislaus National Forest, California.
    Subsection (b) specifies the types of resource management 
activities that can be performed under the contract, including: 
(1) reduction of forest fuel loads through precommercial and 
commercial thinning and prescribed burns in the Granite 
watershed; (2) monitoring of ecosystem health and water quality 
in the Granite watershed; (3) monitoring of the presence of 
wildlife and the effect of the management activities on 
wildlife presence; and (4) other resource management activities 
as the Secretary considers appropriate to demonstrate enhanced 
ecosystem health and water quality in the Granite watershed.
    Subsection (c) requires that all resource management 
activities performed under the contract be consistent with 
applicable Federal law and the standards and guidelines set 
forth in the California Spotted Own Sierran Province 
InterimGuidelines or the subsequently issued final guidelines, 
whichever is in effect.
    Paragraph (d)(1) authorizes the source of funds that may be 
used to provide for the resource management activities to be 
performed under the contract, including: (1) funds appropriated 
to carry out his section; (2) funds specifically provided to 
the Forest Service to implement projects to demonstrate 
enhanced water quality and protect aquatic and upland 
resources; (3) excess funds that are allocated for the 
administration and management of the Stanislaus National 
Forest; (4) hazardous fuels reduction funds allocated for 
Region 5 of the Forest Service; and (5) a contract provision 
allowing the cost of performing authorized management 
activities, such as thinning, described in subsection (b) to be 
offset by the values owed to the United States for any forest 
products removed from the Granite watershed.
    Paragraph (2) prohibits the use of appropriated funds, to 
carry out the contract, from any other unit of the National 
Forest System to carry out the contract.
    Paragraph (3) directs that any transfer of funds under 
paragraph (1) must be reviewed by the Commission on 
Appropriations of the House of Representatives and the 
Committee on Appropriations of the Senate.
    Subsection (e) authorizes the Secretary to accept and use 
funds provided by the State of California to assist in the 
implementation of the contract.
    Subsection (f) requires the Secretary, not later than 
February 28 of each year during the term of the contract, to 
submit a report to Congress describing the resource management 
activities performed under the contract. This subsection also 
states that the report should include the source and amount of 
funds used to carry out the contract, and the resource 
management activities to be performed under the contract during 
the calendar year in which the report is submitted.
    Subsection (g) clarifies that all Federal environmental 
laws apply to the contract.

                   cost and budgetary considerations

    The following estimate of the cost of this measure has been 
provided Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 30, 1998.
Hon. Frank H. Murkowski,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2886, the Granite 
Watershed Enhancement and Protection Act of 1998.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Victoria V. 
Heid (for federal costs) and Marjorie Miller (for the state and 
local impact).
            Sincerely,
                                 June E. O'Neill, Director.
    Enclosure.

H.R. 2886--Granite Watershed Enhancement and Protection Act of 1998

    CBO estimates that enacting H.R. 2886 would have no 
significant impact on the federal budget. Because the act would 
increase direct spending, pay-as-you-go procedures would apply, 
but we estimate the increase would total only about $200,000. 
This act would impose no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments. 
The state of California and local governments in the state 
might choose to share in the cost of this project, but their 
involvement would be voluntary.
    H.R. 2886 would authorize the Secretary of Agriculture to 
enter into a five-year contract with a single private 
contractor to perform multiple management activities on federal 
land in the Stanislaus National Forest in California and to 
fund that contract using receipts from forest products removed 
by the contractor, as well as funds provided by the state of 
California and appropriated funds.
    The U.S. Forest Service is planning to conduct the Granite 
Watershed Project on an area known as the Granite Burn over the 
next five years. Work to be performed under the contract will 
include timber stand thinning, brush removal, road closures and 
maintenance, and other land management work. According to the 
Forest Service, outlays to implement the project will total 
about $5 million over the 1999-2003 period. The agency plans to 
conduct the project, including the timber stand thinning, under 
current law using appropriated funds. (The agency has applied 
for a grant from the CALFED Bay-Delta Program, a consortium of 
federal and state agencies, to partially fund the project, but 
that grant may or may not be awarded.)
    Enacting H.R. 2886 would allow the agency to pay for a 
portion of the project using offsetting receipts generated from 
the project's timber standing thinning. The Forest Service 
expects the thinning to generate offsetting receipts of 
approximately $200,000 in fiscal year 1999. Based on 
information from the Forest Service, CBO estimates that 
enacting H.R. 2886 would increase direct spending outlays by 
$200,000 in fiscal year 1999. Because the act would allow the 
Forest Service to use the receipts to pay for the project, 
enacting the legislation could either decrease discretionary 
outlays by about $200,000 or allow the agency to fund 
additional work, depending on how the Forest Service implements 
the project. CBO estimates that other provisions in the act 
would have no net effect on the federal budget.
    On May 11, 1998, CBO prepared a cost estimate for H.R. 
2886, as ordered reported by the House Committee on Resources 
on April 29, 1998. This version of H.R. 2886 is virtually 
identical to the House version, and the estimated costs are the 
same.
    The CBO staff contacts for this estimate are Victoria V. 
Heid (for federal costs) and Marjorie Miller (for the state and 
local impact). This estimate was approved by Paul N. Van de 
Water, Assistant Director for Budget Analysis.

                      REGULATORY IMPACT EVALUATION

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out H.R. 2886.
    The bill is not a regulatory measure in the sense of 
imposing Government established standards or significant 
economic responsibilities on private individuals and 
businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little if any additional paperwork would result from the 
enactment of H.R. 2886.

                        EXECUTIVE COMMUNICATIONS

    On July 29, 1998, the Committee on Energy and Natural 
Resources requested executive comment from the Department of 
Agriculture and the Office of Management and Budget on H.R. 
2886. These legislative reports were not available at the time 
this report was filed. When the requested reports become 
available, the Chairman will request that they be printed in 
the Congressional Record for the advice of the Senate. The 
testimony provided by the Forest Service at the Subcommittee 
hearing follows:

 Statement of Gloria Manning, Associate Deputy Chief, National Forest 
           Systems, Forest Service, Department of Agriculture

    Mr. Chairman and members of the subcommittee, I am Gloria 
Manning, Associate Deputy Chief for National Forest Systems. I 
am pleased to be here to share the Administration's view on 
H.R. 2886, which would allow the Secretary to contract with a 
single source to implement the Granite Watershed Enhancement 
Project.
    The Administration supports H.R. 2886, Stanislaus National 
Forest Demonstration Project.


  h.r. 2886 to provide for a demonstration project on the stanislaus 
                      national forest, california


    H.R. 2886 would allow the Secretary to contract with a 
single source to implement the Granite Watershed Enhancement 
Project. The Administration supports the bill.
    In 1973, 17,000 acres of the Stanislaus National Forest 
burned in a catastrophic wildfire known as the Granite Burn. 
H.R. 2886 provides support to the Granite Watershed Enhancement 
Project which is a unique partnership to restore a fire-damaged 
ecosystem and reduce the future risk of fire. Forest Service 
officials from the regional and local level have joined 
together in working with local elected officials, private 
forestry professionals, and environmental groups to develop a 
project that will improve both the overall condition of the 
Granite watershed and the health of the surrounding forest. The 
Granite project is supported by the Regional Council of Rural 
Counties, the California Forestry Association, and the 
administrative leadership of the Bay-Delta CALFED process, a 
joint federal-state Bay-Delta Recovery program.
    The collaborative planning efforts for the Project have 
drawn a broad array of partners together including county and 
state governments, the City of San Francisco, irrigation 
districts, environmental groups, industry groups and the 
scientific and academic communities. Partnership commitments 
have been made to further Project planning and implementation 
including additional funding resources, comparable work on 
adjacent private property, and intensive and comprehensive 
scientific and academic monitoring assistance both on- and off-
site.
    The Granite Project calls for multiple resource monitoring, 
timber stand thinning, riparian restoration, meadow 
revegetation, road maintenance, and road obliteration to 
protect watershed values and reduce wildfire hazards. These 
efforts are designed to protect the project area from large 
wildfires, restore hydrologic function in meadows and streams, 
and to reduce stream sedimentation. Long term monitoring is a 
critical component of the project and will include water 
quality, habitat quality, and critical species population 
monitoring.
    The bill had been modified from the introduced version. It 
now includes a technical amendment allowing the Secretary to 
enter into a contract that provides for the exchange of goods 
and services. This modification improves the opportunity to 
leverage federal funds through partnerships and provides a more 
timely and cost-effective response to the specific forest 
health situation in Granite Creek.
    The advantage offered to the public by this project is that 
public scoping has developed clear desired future conditions 
for the watershed, as well as some potential alternative means 
of attaining those conditions. A benchmark assessment of the 
ecosystem and forest health is underway. Therefore, if a 
stewardship contract is the vehicle chosen to implement a 
decision, the Forest Supervisor can include specific and, in 
some cases, quantitative environmental goals. Ecosystem 
improvements can and will be measured and resource inventories 
will be completed prior to implementation. Budgetary impacts of 
using a single contract that exchanges goods for services in 
this case would be minimal, since the costs and foregone 
revenues would be known ahead of time and there is opportunity 
for significant contract competition.

                        changes in existing law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by the Act H.R. 2886, as 
ordered reported.