Feds shouldn’t have approved $2 million ‘Roadless Rule’ grant to Alaska, inspector general says

U.S. Forest Service officials should not have approved a modified $2 million grant to be used for the state’s push to lift the controversial Roadless Rule from the Tongass National Forest, according to an Inspector General report published Dec. 18.

The report concludes that the process used by the Forest Service to give the state the money and the ultimate use of the funds both ran afoul of federal laws and regulations.

The $2 million was first provided to the state via the Cooperative Forestry Assistance Act but state Department of Natural Resources officials requested the grant be modified to allow the state to spend the money to participate in the Roadless Rule determination. Forest Service officials approved the funding change in August 2018 because they said, according to the report, that they needed to act quickly so the state could use the money to advance its work on a state-specific Roadless Rule.

The Roadless grant funds were approved on top of $3 million requested earlier under a state fire assistance grant, according to records provided by the state.

Former Gov. Bill Walker’s administration requested the state-specific rulemaking in early 2018 with the ultimate goal of easing development restrictions in the Tongass.

The problem arises from the fact that Cooperative Forestry Act-related funding is only applicable to state and private forest management, according to the report.

“Therefore, it was improper to award the $2 million to Alaska using the authority granted by the Cooperative Forestry Act of 1978,” the report states.

Additionally, the discretionary status of the money — it was not mandated by federal law to be disbursed — meant it should have been made available to other potential grantees.

“We found that because the Forest Service awarded the $2 million to Alaska by modifying an already-existing grant, there was no public notice of the grant and the award was not opened up to competition,” the authors wrote.

“While we understand the need for timely grant disbursal, urgency does not exempt agencies from following federal laws and regulations,” they continued.

The report also notes that the State of Alaska had not requested reimbursement for any of its expenses related to the Alaska-specific Roadless Rule and therefore the $2 million remains obligated and available.

Michigan Sen. Debbie Stabenow and New Mexico Rep. Raul Grijalva, Democrats who back the Roadless Rule, requested the investigation into the grant in November 2019 following congressional hearings and new coverage of the matter.

At the time, Gov. Mike Dunleavy roundly criticized the request, arguing the grant was “appropriate and legal” and suggested Stabenow and Grijalva should “do their homework” before making such a request.

A spokesman for the governor referred questions about the report to DNR representatives, who did not respond in time for this story.

DNR officials and Alaska Forest Association leaders subsequently inked a cooperative agreement in March 2019 authorizing the timber trade group to spend up to $250,000 of the modified grant funds to develop an economic analysis of the amount of timber made available for harvest in each of the alternatives included in the Roadless Rule EIS, which was published approximately six months later.

The money from the sole-source state contract was primarily spent on consultants and former State of Alaska foresters to study the opportunity for more old-growth timber harvests following the pending repeal of the oft-debated Roadless Rule in the Tongass, but thousands of dollars was also spent on travel, outfitting the hired help with computers and software, and a 12.5 percent administrative fee charged by the Alaska Forest Association, or AFA, according to invoices obtained by the Journal in late 2019 through a public records request.

The state’s expenses first planned to be covered by the grant money appeared to meet all applicable federal regulations, according to the report.

U.S. Department of Agriculture officials finalized the full repeal of the Roadless Rule that the Dunleavy administration had pushed for in late October of this year.

Leaders of some Southeast Alaska Tribes — which can also be cooperating agencies in a federal environmental review — opposed to the repeal said they were not offered any of the grant money by the state to participate in the Roadless Rule process. DNR officials disputed those assertions at the time.

Forest Service leaders accepted the recommendations from the Inspector General’s Office that the agency not spend any of the $2 million and work with the Office of General Counsel to develop and implement a compliant spending plan for the money by Oct. 1, 2021, according to the report.