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The President’s Management Agenda contains five government-wide goals to improve Federal management and performance and deliver results that matter to the American people. These goals are:

• Strategic Management of Human Capital;
  
• Competitive Sourcing;
  
• Improved Financial Performance;
  
• Expanded Electronic Government; and
  
• Budget and Performance Integration.

The USDA Forest Service specifically supports the President’s Management Agenda by:

1. Streamlining Forest Service Operations.
   
   • Aligning the Forest Service workforce to better carry out the agency mission
     
   • Creating incentives that control costs while enhancing natural resource management
     
   • Streamlining and automating administrative support processes
     
   • Increasing internal and external competition for services;
     
2. Implement Competitive Sourcing for agency commercial activities and performance-based Service Contracting to maintain increases of 10 percent annually through FY 2005;
   
3. Expanding Electronic Government by simplifying the permit process, expanding on-line procurement, improving public access to information, and participating in the government-wide Presidential Initiative on e-grants for grants and agreements;
   
4. Integrating performance and budget;
   
5. Improving Wildland Fire Management, Budgeting, and Accounting; and
   
6. Achieving a clean audit opinion for FY 2002 and beyond while simplifying agency accounting process.

In June 2002, the Forest Service finalized its strategy, entitled “Forest Service Strategy for Improving Organizational Efficiency, 2003-2007.” Twenty-one implementation plans covering various aspects of the strategy have been developed and full implementation of this strategy will be underway in FY 2004.

1. Streamlining Forest Service Operations

The Forest Service continues to explore and implement ways in which to streamline operations in order to cut costs, reduce bureaucracy and improve customer service. Several efforts are planned or ongoing, including efforts to reduce indirect costs to as little as 10 percent of the budget, monitoring fixed-to-variable cost ratios, consolidating offices, and better examining the role and structure of each organizational level in order to eliminate duplication and streamline processes.

Strategic Management of Human Capital – In order to achieve the goals in the OPM/OMB/GAO “Human Capital Assessment and Accountability Framework” the Forest Service will make significant investments in five key areas: 1) Workforce Planning Systems/Recruitment Strategies; 2) Corporate Training Strategies; 3) Succession Planning;
4) Knowledge Management; 5) Performance Management.

The Forest Service Workforce Planning System is: consistent with agency mission, goals, and objectives; integrated into the Forest Service budget and Strategic Plan; based on a 5-year workforce analysis that identified skill gaps, competencies, and attrition; and contains guidance to ensure succession based on attrition. The workforce plan addresses the following items:

• Identifying and addressing mission-critical skill gaps
  
• Balancing the age-distribution of the workforce to ensure an adequate “pipe-line” of highly skilled employees;
  
• Ensuring a workforce that reflects the diversity of the American public that we serve;
  
• Ensuring accountability; and
  
• Redirecting resources to direct service delivery positions.

The specific actions with performance levels that the agency proposes to carry out in FY 2003 and FY 2004 are as follows:

• Reducing size of organization layers/ reducing time to make decisions/ greater decision-making authority to field managers: The agency is taking actions to re-align its workforce to better carry out the agency mission. Specifically, this focuses on headquarters operations. Currently the Washington Office has approximately 2,050 employees including detached units. Washington Office funding ceilings were reduced 5 percent in FY 2003, and will be reduced another 5 percent in FY 2004.
  
  • A comprehensive study of all Washington Office detached units is underway which will result in realignment, competitive sourcing analysis, potential reductions, and/or a more corporate basis for making decisions about a unit’s products and services.
    
  • The Forest Service is developing clear role definitions for each organizational level in order to eliminate duplication and better align the workforce. Consistent with this effort is a detailed review of the role of the Washington Office and an examination of agency-wide financial management operations, based on the need ensure competent financial management in the emerging e-government environment. The role analysis and action plan will be finalized in FY 2003.

2. Competitive Sourcing

The President’s Competitive Sourcing Initiative is a tool for achieving improved efficiency and performance through the introduction of public/private competition for functions currently performed by the government. Experience in other agencies have shown that significant cost savings and performance gains can result through these competitions, regardless of whether the function is competitively sourced or a government reengineered “Most Efficient Organization” is established.

In early FY 2003, USDA established a Field Leadership Decisions Initiative that included a commitment to increase annual competitive sourcing of commercial activities by 10 percent annually through FY 2005. To meet this commitment and Administration goals for competitive sourcing, the agency will conduct public/private competitions on approximately 3,000 FTE’s during FY 2003, and on similar numbers in FY 2004, with a total of 11,000 positions being competed by the end of FY 2005. The FY 2003 competitions will rely heavily on using the streamline process at the local level. Starting in FY 2004, the Forest Service will shift into using primarily the full-cost comparison process that costs more initially, but produces a higher level of cost-savings in the end. Identification of the FY 2004 functions to be competed is underway. Expected areas of competition are Human Resources, Information Technology and some elements of Wildland Fire Management.

In order to accomplish these efforts, the agency plans to staff a program leadership office at Headquarters (3 FTEs) and establish a field service center (5 FTEs). In addition, the agency plans to award several Office of Management and Budget (OMB) A-76 support contracts. Significant travel costs are anticipated due to the agency’s wide geographic distribution. Implementation plans, communication plans, and guidance have been developed and deployed. Significant training efforts have been completed and additional training will be needed.

The commitment by the Forest Service is to use competitive sourcing along with its already successful use of contracts, concessions, permits, grants and agreements to improve efficiency and flexibility. The Forest Service is making great strides in increasing the use of performance-based contracting. The agency expects to utilize performance-based contracting on 30 percent of all contracts in FY 2003 and 40 percent in FY 2004.

3. Expanding Electronic Government

At its most basic level, the Forest Service electronic government initiative will use digital technologies to transform government operations in order to improve effectiveness, efficiency and service delivery.

The Forest Service has a plan that integrates the President’s e-Gov initiatives and USDA’s “Smart Choice” e-Gov initiatives with agency priorities described in “Forest Service e-Government Strategy and Roadmap.” In FY 2003, the agency will focus on three foundation projects: 1) Web Information Delivery, 2) Government Paperwork Elimination Act (GPEA) Compliance, and 3) e-Gov project management organization. Each of these will require continued effort and funds in FY 2004. In addition, agency prioritization analysis indicates that four additional e-Gov projects should be started in FY 2004, specifically: 1) Incident Planning and Management, 2) Recreation Services and Information, 3) Electronic NEPA/NFMA Planning Record, and 4) Simplifying the Federal and non-Federal Assistance Process. These e-Gov projects will follow a three-step process: 1) Business Case Development, 2) Proof-of-Concept Testing; 3) Scale-Up to full implementation. Funding will be needed for the first two steps in this process for the four FY 2004 priority projects, as well as continuing with steps 2 and 3 for Web Information Delivery. Funding will also be required to sustain and mature the electronic exchange of information with the public begun in the FY 2002 GPEA compliance efforts.

4. Integrating Performance and Budget

The Forest Service is developing a budget and performance planning process that will result in budget formulation and funding allocations to programs that integrate the agency mission with long-term performance goals and the strategic plan. A Performance Accountability System plan was developed in FY 2002 and has been approved for implementation during FY 2003. The Chief of the Forest Service has directed the agency to develop a results-oriented annual performance management plan for FY 2005, which is currently under development. A comprehensive set of national management objectives and associated performance measures with connected data sources have been identified. These have been linked to a set of national work activities for use in the FY 2005 budget formulation process. The purpose is to deliver integrated financial management, budget development, and program accountability at all levels of the organization.

The strategic plan identifies national goals and multiple policy objectives. National programmatic “management strategies” contribute to a given policy objective. The combination of annually developed management strategies is the basis for the Forest Service annual Performance Management Plan. This annual plan sets measurable goals or accomplishment targets and provides the basis for budget formulation driven by performance requirements.

The Performance Accountability System represents a process that will link many existing systems, including formulation, accounting, work planning, and accomplishment reporting. The process will allow individual programs and field units to establish out-year programs of work based on local or programmatic objectives and needs linked to national objectives. Underlying these national systems are tools that provide assessments of agency operations in order to understand the social, economic, and ecological conditions that define where the agency stands in achieving its mission and to establish policies to achieve further progress. The Forest Service will support the USDA budget and performance integration effort to help move the Department to a “green” status through pilot testing the budget and performance integration plan, with the objective a FY 2005 budget submittal as per the budget and performance integration plan.

5. Improving Wildland Fire Management, Budgeting, and Accounting

In response to the President’s Management Plan, the Forest Service and Department of the Interior are working collaboratively to develop a joint fire preparedness performance-based model to review fire suppression activities and conduct an audit of the Fire Suppression Program, and ensure properly targeted hazardous fuels funds. Additionally, the Forest Service is developing an automated system that provides real-time fund obligation information. The following is an update on the progress of these initiatives:

Joint Fire Preparedness Performance-Based Modeling: The Forest Service, Department of the Interior, and the National Association of State Foresters are working together to develop a new fire preparedness-planning model. The agencies and the Administration have agreed on the desired attributes of this new system. Staff organization, technical approvals, and preliminary design are ongoing.

Coordinating Budget and Performance Information: There is an immediate need to meet an expectation of the Administration that both Agencies have similarly structured wildland fire budgets, including appropriate language and performance measures. The Departments have met with the Administration and agreed upon new performance measures. Baseline information is being collected and the measures will be instituted in FY 2004.

Developing a Fire Planning System: This is a long-term effort to design and develop a new inter-agency fire planning system that takes advantage of new science and technology and provides a more comprehensive look at the fire management program and the decisions necessary to maximize public safety, program effectiveness, firefighting efficiency, and ecosystem protection. This new planning system will address the Administration’s concerns related to science and research based modeling, performance measures, and the use of one system by all wildland fire management agencies. As stated above, release of the first part of the new system will take place in October 2004.

Reviewing Fire Suppression Costs and Strategies: The Forest Service has received a commissioned report from the National Academy of Public Administration entitled, Wildfire Suppression: Strategies for Containing Costs. The Secretaries of Agriculture and the Interior and 17 western Governors have signed a 10-Year Comprehensive Strategy designed to improve fire prevention and suppression, reduce hazardous fuels, restore fire-adapted ecosystems, and promote community assistance. These reports and others will provide the strategic direction that will allow the Federal firefighting agencies to improve firefighter and public safety, protect communities and the environment, and reduce overall program costs.

Ensuring that Hazardous Fuels Funds are Appropriately Targeted: In order to ensure that hazardous fuel funding is properly targeted to have the greatest immediate impact on community protection with priority given to at-risk communities, the Forest Service has done and plans to do the following:

• FY 2003 - The Forest Service and the Department of Interior will be using the project proposal database and the final set of national, regional, and local funding criteria merged with field-based requests to select projects. The foundation for hazardous fuels project selection is a memorandum of understanding between Federal agencies, State Foresters, and counties. This agreement will support implementation of a hazardous fuels reduction program that restores the health of forests and rangelands and protects communities. Community risk, the ability to create cooperative partnerships with a selected project, threats to human life and property, watershed protection, and treatments that complement other projects are some of the priorities that will be emphasized. The Forest Service will fully implement the President’s Healthy Forests Initiative and the Ten-Year Comprehensive Strategy. The Forest Service will coordinate with the Department of the Interior to complete the Cohesive Strategy for hazardous fuel treatment. The Forest Service will treat an estimated 1.6 million acres of hazardous fuel to protect communities and reduce flammability of forests, woodlands, shrublands, and grasslands. Approximately 890,000 of those acres will be in wildland-urban interface areas and approximately 720,000 acres will be treated in the non-wildland-urban interface. Treatment areas will include wildland-urban interface areas where NFS lands are intermingled with other Federal, State, private, or Tribal lands, short-interval fire-dependent ecosystems, areas within or adjacent to wilderness, and areas where treatment could reduce long-range fire suppression costs. The Departments of Agriculture and the Interior will fully implement performance measures that reflect the level of risk reduced by treatments. Included are regional workshops and activities at the local level. The Forest Service will work with State cooperators and continue a program to reduce fire hazards on adjacent non-Federal lands and protect communities when hazard reduction activities are planned on adjacent National Forest System lands. Prior to hazardous fuel treatments on Federal lands, the Forest Service will work with communities to pre-treat adjacent non-Federal lands to decrease the chance the hazard reduction activity might threaten the community or private lands.
  


• FY 2004 - Emphasize treatment in the wildland-urban interface through collaborative efforts contained in the 10-Year Comprehensive Strategy. Treat a total of approximately 1,368,000 acres of hazardous fuel to reduce flammability of forests, shrublands, and grasslands with emphasis on the wildland-urban interface. An estimated 652,000 non wildland-urban area acres and 716,000 wildland-urban acres are to be treated. The priorities outlined in the President’s Healthy Forests Initiative and the 10-Year Comprehensive Strategy will be used to guide the overall program. Coordination with Tribal governments and other Federal, State, and local agencies will focus treatment on high priority communities at risk. On Federal lands, emphasis will be given to short-interval fire adapted ecosystems to protect communities and natural resource values.

Providing Real-Time Obligation Information: The USDA Forest Service, in partnership with the National Wildfire Coordination Group (NWCG), is engaged in a wide-ranging effort to improve incident business management and accounting operations. In concert with this long-term effort to seamlessly integrate business management operations with the automated infrastructure of participating agencies, the Forest Service intends to independently implement short-term actions for the FY 2003 fire season to accomplish three objectives: 1) Provide an automated “proof of concept” for longer term accounting reforms; 2) Demonstrate a process and commitment to improved speed and quality of obligations incurred at wildfire incidents; and 3) Establish additional procedures that will increase the quality and speed of obligation reporting ultimately leading to real time reporting of all incident obligations.

The goal of the Incident Accounting Improvement Project is to have seamless information technology products and financial services that increase financial operations efficiency, provide information that can help reduce costs associated with incidents, and provide real time accounting information to those that manage the program, including external agencies that rely on the information and customers who need it.

To accomplish this, the Forest Service and the NWCG will, over the next several years:

• Expand the use of telecommunications technologies to ensure that large fire incidents no longer operate on isolated platforms and are able to connect to the agency’s accounting system in a manner that allows fast movement of information.
  
• Integrate incident information systems with the corporate accounting system to eliminate manual processes that are redundant and create reporting delays and inaccuracies.
  
• Make certain payments are efficiently processed in a centralized manner to increase standardization, ensure skills are available, and reduce transaction process time.

During the FY 2003 fire season, the Forest Service will implement a demonstration project with the following specific objectives:

• Identify the business requirements (processes, skills, and technology) needed to enter national contract and emergency equipment procurement financial information directly into the accounting system.
  
• Design and build a feeder system that requires minimal or no change to the current one, or to existing fire accounting software; test the system in the National Incident Coordination Center for national contracts and on a number of large fires throughout the year for emergency equipment.
  
• Evaluate the results of the tests including recommendations on how to expand the system to include all fires and other types of incident financial information.
  
• Apply a federally-compliant definition of emergency obligations in designing incident financial management reporting procedures.
  
• Develop a portable “front-end” system for use on laptop equipment that will support entry of a “summary” obligation into the accounting system and develop a subsidiary ledger for detailed information to support the summary obligation entered into the accounting system. This detailed information must be readily available on agency servers.

6. Achieving Clean Audit Opinions While Simplifying Agency Accounting

The agency achieved an unqualified audit opinion in FY 2002. Although it is an important first step in improved financial performance, the agency must continue to maintain this level of performance in future years.

• Improved financial management: The Forest Service received an unqualified (“clean”) audit opinion for FY 2002. This accomplishment, while significant, is only a first step in continued path to quality financial management. The agency is committed to maintaining a clean audit opinion for FY 2003 and beyond. A cornerstone of improved financial and performance accounting is a commitment to account for funds and report information using only essential work activities. In FY 2002 the Agency accounted for over 100 specific work activities in the Department’s accounting system. This number of activities and other agency processes resulted in generation of 65 percent of the Department’s total transactions. A reduction in the number of work activities is considered critical to being able to track and account for funds and accomplishments. The Forest Service will expand efforts to reduce the cost of its financial accounting structure in FY 2004.
  
  • In FY 2003, the agency has eliminated accounting by work activities in the accounting system. In place of accounting by work activities, the agency will implement a new national work planning system, effective April 2003. This system will be an integral aspect of the agency’s performance accountability process that will improve budget and performance integration.
    
  • The agency has significantly changed its processes for indirect cost accounting, resulting in approximately 140 million fewer system transactions than in FY 2001.