18 



maintenance, thinnings, tree planting, pre-commercial thinning, 

 site preparation, and fertiUzation. Those practices have taken place 

 on almost 20 percent of the land that we manage out there. A very 

 significant amount of work. 



I refer you now to the chart on page 9. That chart is the forest 

 development expenditures by major categories of work. On that pie 

 chart, the important points for you to focus on are the green areas. 

 This shows that 76 percent of our dollar expenditures have gone 

 into on-the-ground work, and how that money was spent is indi- 

 cated on this chart. If you have questions on any of tiiis informa- 

 tion, I would be happy to come back to it. The fact is that $113 mil- 

 lion has been invested in forest development in that three fiscal 

 year period. 



Mr. Vento. This is in millions, is that right? 



Mr. Penfold. Yes, sir. That is 113 million total, so those are in 

 millions. Yes, sir. 



Mr. Vento. Okay. 



Mr. Penfold. I am sorry. Those are in thousands. So, if we take 

 a look at intensive forest practices, that is a $14 million figure. 

 Okay? 



Mr. Vento. Yes. 



Mr. Penfold. If I could focus your attention on page 10, that is 

 the forest development by major object class. Here I would like to 

 point out that 45 percent of these dollars were done by contract 

 work, and that is the main point on that chart. 



The IG recently announced a follow-up audit of this program. We 

 welcome this updated examination by IG and we are going to work 

 very cooperatively with them on that. 



The success of our projects is significant. We have been able to 

 treat sufficient acres to support the timber offered for sale over the 

 past decade. However, we are limited in our annual budget capa- 

 bilities and must prioritize treatment to those that give us the 

 greatest return. Our first priority is to assure that harvested and 

 burned areas are prepared for planting, are planted, and the main- 

 tenance work necessary for seedling survival is conducted. 



We never anticipate that we can complete all this work in any 

 one fiscal year, and we normally defer acres needing treatment into 

 future fiscal years. As I mentioned before, much of the carryover 

 is anticipated and we don't consider it a backlog. 



Intensive practices such as pre-commercial thinning and fertiliza- 

 tion increase the growth and timber value of young stands. These 

 practices are very cost effective. The excess funding we received 

 made it possible to make substantial progress in this area. 



I would like you to take a quick look on pages 6 and 7. There 

 are a couple of other charts that I will refer to there. If you look 

 at page 6 first, this indicates the pre-commercial thinning that was 

 done between fiscal years 1990 and 1992, as well as the need to 

 do pre-commercial thinning. On this chart, you will notice on the 

 righthand side a fairly large blue area of carryover work that we 

 believe needs to be done. The President's economic package would 

 accomplish about 70 or 80 percent of the work indicated in that 

 blue column on this pre-commercial thinning chart. 



