61 



Rather, skiing is a nonconsumptive use which frequently shares 

 the land with hunters and fishermen, livestock grazers, offroad ve- 

 hicles, hikers, cross-country skiers, mountain bikers, utility rights- 

 of-way, communications facilities, and numerous other uses. 



In addition, at many ski areas, lift operations together with road 

 and trail networks provide the public with far greater access to, 

 and the use and enjoyment of, the national forest lands than would 

 occur in their absence. 



The need for a new fee system. The National Ski Area Associa- 

 tion has taken the lead in seeking introduction and enactment of 

 H.R. 1527. We feel a change in the way ski areas pay rent for the 

 use of national forest system land is warranted because the exist- 

 ing Graduated Rate Fee System, also known as GRFS, has become 

 too complex and cumbersome. 



As the subcommittee may be aware, GRFS was initiated by the 

 Forest Service in the early 1970's to capture a fair market value 

 leasing fee for the United States. In general, we believe it has done 

 that remarkably well, and the fee for national forest ski areas is 

 indeed significantly higher than most other private or government 

 ski area lease rates as will be discussed later in the testimony of 

 Sno. engineering. Inc. 



However, by its very nature, GRFS is complex because it relies 

 on a different breakeven point for various aspects of a ski area's 

 income; it uses calculations of gross fixed assets which have been 

 increasingly subject to varying interpretations; it contains difficult 

 definitions as to what lands or activities should be subject to the 

 fee; it raises debates over gratuities given to employees and/or the 

 public, and other complexities. 



The ski industry has spent several years, hundreds of hours, and 

 considerable money attempting to resolve these issues with the 

 Forest Service administratively. These efforts have not met with 

 success. Therefore, the ski industry believes that it is time to 

 change the fee formula legislatively and boil it down to a simple 

 percentage of gross sales system. 



The calculation of rent for the use of national forest land should 

 not require a 40-page-plus document, nor should the Forest Service 

 be permitted to assess rent against private land that it does not 

 manage for the citizens of the United States. Those are only the 

 two underlying tenets of H.R. 1527 — simplicity and the elimination 

 of private land assessments. 



The General Accounting Office and the Forest Service have made 

 numerous estimates of the national average of rent paid by ski 

 areas expressed as a percentage of the ski area gross revenue. 

 These percentages have ranged from 2.2 to 2.5 percent of the ski 

 area gross revenue as defined by the Graduated Rate Fee System. 

 Keep in mind that GRFS includes revenue attributed to the cost of 

 free lift tickets given to ski area employees as well as the revenue 

 of businesses on private land not owned or operated by the ski area 

 permittee. 



Regardless of the percentage that is used as an estimate of the 

 ski area industry's national average of Forest Service fees paid as 

 a percentage of gross revenue, the following facts should be under- 

 stood. Ski areas on Federal land pay more than ski areas on pri- 

 vate or State land for land rent. 



93-983 0-95-3 



