FNR-150-W

Cooperative Extension Service
Purdue University
West Lafayette, IN 47907

Forest Policy Issues in Indiana*

The purpose of Forest Policy Issues in Indiana is to provide a brief overview of public policy analysis as well as a summary of leading contemporary policy issues in Indiana relating to forestry.

Forestry is important to Indiana. Its forests are strikingly beautiful, productive in terms of wildlife habitat, and sites for many outdoor recreational activities. Furthermore, these forests support several industries manufacturing wood products: hardwood lumber and veneer at the primary level and wood furniture and cabinets at the secondary level. Together these industries comprise one of the very largest employers in the state.

A public policy problem or issue necessarily precedes a public policy. Policy can be defined as a settled course of action. A policy can be private or public. The kind discussed here is the latter Hence, a public policy is a settled course of action to be followed by a government body or institution with regard to an issue.

Policy analysis is an applied academic discipline which can be defined as the systematic evaluation of the viability of alternative policies from several perspectives, strategies for implementation, and the consequences of adoption. A seven-step process is often used in conducting policy analysis, specifically:

1. Defining the problem;
2. Establishing evaluation criteria;
3. Identifying alternative policies;
4. Evaluating alternative policies;
5. Selecting the preferred policy;
6. Implementing the preferred policy; and
7. Monitoring and evaluating policy implementation

Rationales for Public Policy

A rationale for public policy can also exist when public consensus exists about some social goal such as income distribution, education, or aesthetics. For example, public education is not provided in the U.S. because of market failure, but because society feels it is desirable and necessary in a democratic society

There are limits to government intervention in markets, and they can be called instances of government failure (Weimer and Vining). It has been convincingly shown, for example, that majority voting cannot provide a means of determining collective choices consistently from individual choices and, at the same time, satisfy conditions of rationality. In other words, voters are frequently inconsistent in expressing their collective preferences. Further, significant problems with representative government exist which sometimes lead to government failure such as the disproportionate influence of organized or special interests, the conflict between regional interests and national interests, the short time horizons of elected officials caused by the election process, and the distortion that occurs in public policy debates when politicians posture to news media to gain public attention. Finally, there are bureaucratic organizational problems associated with government including:

1. limitations in time and expertise necessary to review and monitor government operations, including how resources are used;
2. lack of competition and its effect on incentives to innovate;
3. difficulty in valuing output of many government services such as national security, law and order, and safety; and
4. inflexibility in personnel administration because of civil service protections and perhaps some affirmative action programs.

The point is neither the market system nor government intervention is the complete answer in the allocation of resources or goods and services. In fact, the best answer to a question of which is better is "it depends." And among those things upon which "it" depends are societal values and goals, the perceived degree of market failure, and the likelihood of success of government intervention.

Criteria for Evaluating Public Policy

1. Physical and biological (technical) feasibility: Is the policy physically and biologically (technically) feasible? For example, with regard to forestry, does the policy make biological sense? Would it have the intended effect? Would it adequately address the problem?
2. Economic efficiency: Are the benefits of the policy worth the costs, both tangible and intangible in each case? Has a conscientious effort been made to minimize the unintended consequences in the market?
3. Equity: Who benefits and who loses? Is it fair, applying conventional societal standards?
4. Social acceptability: Is the policy acceptable to society in terms of prevailing social values and goals? To what extent is the policy acceptable to relevant groups in society?
5. Administrative practicality: Does the implementing agency have the authority to carry out the policy? How committed to the policy is the agency? Is it capable of implementing the policy in terms of staffing, bugdet, and time? Does the agency have the physucal facilities, equipment, and other support to implement the policy?

Table 1. Advantages and Disadvantages of Generic Kinds of Government Intervention

  Kind             Advantages           Disadvantages
------------------------------------------------------------
General            Voluntary            No compliance
education       participation;         mechanism; lacks
programs          inexpensive           site specificity

Technical          Voluntary             No compliance
assistance       participation;            mechanism
programs        provides for site
                  specificity;
                  comparatively
                   inexpensive

Insurance or        Voluntary            No compliance
"cushioning"       participation;          mechanism;
programs         market responsive;         modestly
                provides investment         expensive
                    incentive by
                   reducing risk

Regulation        Has compliance        Mandatory; raises
                  mechanism; can       production costs of
                 provide for site        producers;costly
               specificity; effective       to enforce;
                    in achieving           unresponsive
                    minimum              to market forces
                  performance
                   standards

 Taxation        Participation in            Taxation
    or            subsidy or tax           approach is
subsidization      expenditure             involuntary;
                  programs is                costly
                voluntary; Market
                   responsive;
                provides incentives

  Public        Targeted; provides        Unresponsive to
ownership           for long time          market forces;
                     horizons and         costly; subject
                  nonmarket values             to the
                                            vicissitudes
                                           of government
                                              funding

Generic Kinds of Government Intervention

1. General education programs, e. g., developing and offering educational programs through the cooperative extension service for various groups, such as forest landowners, by offering seminars, workshops, and field tours.
2. Technical assistance programs, e. g., developing and offering direct site-specific technical assistance programs for forest landowners;
3. Insurance or "cushioning" programs, e. g., an insurance program for forest landowners against forest disease epidemics, insect infestations, and fires.
4. Regulation: directing allocation of resources by rules or orders issued by the executive authority of government, having the force of law.
5. Taxation or subsidization: offering financial incentives or favorable tax treatment, e. g., government cost-sharing for tree planting by a private landowner, or financial disincentives such as a tax on overseas shipment of saw logs.
6. Public ownership of resources or production or goods and services: directing allocation of resources by direct government intervention in markets. Government ownership does not have to be complete. Government may acquire only those property rights necessary for its purposes such as the development rights of a tract or the surface rights.

The foregoing forms of government intervention through public policy are not presented in a random order. Instead, they are presented in an order intended to approximate an increasing degree of intervention as well as relative cost. While these may comprise two criteria for evaluating public policy, they are not the only ones as indicated earlier. Set forth in Table I is a list of advantages and disadvantages of each form of intervention.

Contemporary Forestry Issues in Indiana

A no-action alternative-doing nothing-is normally included among the alternative policy solutions for any public policy problem, and it should be assumed for each of the policy issues listed below. Generally, selecting the no-action alternative would result in exacerbating the identified problem. On the other hand, the no-action alternative may occasionally compare quite favorably to other proposed solutions when subjected to evaluation criteria such as that described earlier.

Forest Fragmentation

Public Policy Problem: Indiana forests are fragmented and are in danger of becoming more so, adversely affecting biological diversity of forest flora and fauna in the state.

Public Policy Solutions:

1. Protect forrest lands by zoning. Forest lands could be zoned so they continue under forest cover. Nevertheless, zoning is a form of regulation and would be strongly objected to by some landowners.
2. Provide financial incentives to place and maintain land under forest cover. Financial incentives for landowners could be used to protect existing forest lands, to increase their size, and to establish forests to lessen the degree of forest fragmentation in the state.
3. Acquire key forest lands. Forest lands could be acquired and placed under public ownership to increase the size of existing public forests, to "block up" existing holdings of public forest land, to reduce forest edge-the transition zone between adjacent vegetative communities-on public forest lands, and to provide suitable vegetative corridors between forests, such as along water courses. The challenge, of course, is that land acquisition is expensive. In lieu of acquisition, development rights could be acquired, which would lessen the cost of this approach.

Interstate 69 Extension from Indianapolis to Evansville

The controversy centers primarily around the selection of the route for the extension. Several have been proposed, and three have been actively considered. From a forestry perspective, the issue is the impact of the extension on forests in southwestern Indiana. To what extent would it reduce forest lands in the region? What effect would it have on forest fragmentation? What effect would suburban development along the corridor have on forests and wildlife habitat? To what extent would such development limit forest accessibility for timber harvesting?

Public Policy Problem: Extension of Interstate 69 could significantly reduce forest acreage in southeastern Indiana and increase forest fragmentation.

Public Policy Alternatives:

1. Construct the extension on a route that minimizes a reduction in acreage. The problem with developing such a route is that it would likely require converting productive agricultural land into an interstate highway and increase the cost of the extension.
2. Mitigate the reduction in forest acreage by converting agricultural land into forest land. The problem with mitigation is that it is costly, and it normally involves a lengthy transition period before its positive effects are realized.

Lack of Resource Data

The survey is supposed to be conducted every ten years, but indeed the last two surveys were conducted in 1967 and 1986, nineteen years apart. Another forest survey is scheduled for 1996. Survey data are gathered with respect to forest land area, including productivity, forest type, and ownership, and stand-size class distribution, including tree species, diameter distribution, mortality, net growth, and removals.

No data are collected on forest health, and spatial data are inadequate for purposes of making virtually any inferences about forest dynamics across the landscape. Furthermore, no data are routinely collected on the economic aspects of timber such as timber and saw log prices. Finally, data on the wood products industries are lacking other than what periodically appears-about every four of five years in the Census of Manufacturers which is of little use for making economic development decisions. The frequent claim that the wood products industries is the fourth or fifth largest industry in Indiana is at best an educated guess based on fragmentary and incomplete data. Other than birds, systematically collected data on forest animals is unavailable.

Public Policy Problem: Reliable information on the forests of Indiana is seriously lacking, especially from the perspectives of forest health and economic development.

Public Policy Solutions:

1. Continue to conduct or support Forest Service and ad hoc surveys of Indiana forest lands and resources. The current approach of supporting Forest Service surveys of Indiana forest lands and ad hoc surveys of various kinds can be continued, but it would yield data that is basically inadequate for effective decision making.
2. Conduct or support comprehensive, systematic surveys of Indiana forest lands and resources. Developing and implementing a comprehensive, systematic survey of Indiana forest lands and resources, while costly, would provide the necessary basis for effective decision making. Funding for such a survey could come from both federal and state sources as well as the benefiting industries.

Large White-Tailed Deer Populations in State Parks

Public Policy Problem: White-tailed deer populations in several state parks have grown to such numbers that they are having adverse effects on forest flora and other fauna.

1. Trap and transfer. Trapping white-tailed deer and releasing them at another location has been proposed, but it would be very costly as well as stressful to the deer. It also assumes another location is available which may not be the case.
2. Fence state parks. Fencing state parks would also be very costly as well as aesthetically objectionable to many citizens. Furthermore, it would be detrimental to the movement of other species and, hence, objectionable from an ecological perspective.
3. Reintroduce predators. Natural predators such as bears, cougars, lynx. and wolves could be introduced to control white-tailed deer populations, but they likely would not confine their movement to state parks or their food source to white-tailed deer. This method of control would probably not be socially acceptable because of possible harm to humans. Paying for domestic livestock killed by predators would involve serious, continuing administrative problems. Finally, it is arguable whether predators have ever "controlled" the population of a prey species in the conventional sense of the word.
4. Control fertility. Fertility of white-tailed deer herds could be controlled by administering biochemical contraceptive compounds delivered either by injection or through adulterating the food supply of the animals. Administering contraceptives by injection, however, is very time-consuming, expensive, and sometimes dangerous. Adulterating the food supply is less costly, but there is no assurance that only white-tailed deer would ingest the food and, hence, be affected.
5. Allow controlled hunting of white-tailed deer on state parks. Controlled hunting of white-tailed deer would reduce their populations rather inexpensively. On the other hand, some citizens object to the killing of deer. Furthermore, this solution involves a problem in administrative practicality in terms of who can hunt and how many deer may be taken. In fact, controlled hunting is the policy adopted by the Indiana Department of Natural Resources, and it has temporarily reduced the deer population in state oats.

Protection of Urban Trees and Forests

Similarly, urban forests are increasingly stressed by the effects of human activities, ranging from air pollutants, such as sulfur dioxide, nitrous oxides, and ozone caused by automobiles, power generation, and manufacturing; development activities; and soil compaction, often the result of poor trail design, maintenance, and use.

Public Policy Problem: Urban street and ornamental trees are being stressed and many are dying primarily because of inadequate growing space, poor soil conditions, poor planting techniques, lack of maintenance, and improper maintenance practices. Furthermore, urban forests are being stressed by pressure from a variety of human activities, both economic and recreational.

Public Policy Solutions:

1. Provide general education programs for adults and children on tree care and how to use and appreciate local forests. Many problems in urban forestry and tree care could be resolved if homeowners were more knowledgeable about tree biology, tree selection, placement, planting techniques, and maintenance. Seminars, short courses, and field tours could be conducted by state agencies, including the cooperative extension service, and often are. More would be better. Further, similar programs could be conducted for children and include components on how to appreciate and use urban forests.
2. Conduct educational and technical assistance programs for developers, building contractors, municipal planners and landscape maintenance crews, and park designers and maintenance crews. The purpose of such programs would be, among other things, to: (1) inform developers and road and building contractors about how to select and protect trees during development and construction activities; (2) assist municipal planners in understanding the spacing and soil requirements of trees, appropriate selection of tree species, and the need for tree care and maintenance; (3) instruct landscape maintenance crews on how to care for urban trees as well as how not to abuse them during routine maintenance activities such as mowing, and (4) assist park designers and maintenance crews in developing trail systems in urban parks and forests.
3. Regulate tree planting, maintenance, and removal in urban areas. Municipalities could enact ordinances that require protection of trees during development and construction projects, that spaces be left for trees in development and construction projects, and that trees of appropriate species be planted in these spaces where none are growing. These ordinances could also set requirements for tree maintenance and removal.
4. Provide financial incentives for developers. Municipalities could provide incentives to developers for keeping and protecting trees of designated species during clearing of residential development projects

Regulation of Forest Practices

Regulation can have positive effects on forest productivity and environmental quality. It can also have negative effects if compliance is too costly in terms of time, effort, and work stoppages, and too restrictive, such as when productive timber management activities are discouraged.

Public Policy Problem: Should forest practices on private lands be regulated to sustain forest productivity and timber supplies and to meet water quality goals?

Public Policy Alternatives:

1. Conduct landowner educational and technical assistance programs. Educational and technical assistance programs for forest landowners already exist, but they could be augmented. Their premise is that if landowners are knowledgeable about forest management, they would apply the knowledge, raising the level of management on their lands. The challenges to this premise are, first, only a small proportion of forest landowners participate in educational and technical assistance programs, and second, no actual incentives exist for the landowners to apply the knowledge they have acquired.
2. Develop and use best management practices (BMPs). In lieu of regulation of forest practices, many states, particularly in the South, have adopted BMPs as a way of achieving their water quality goals. BMPs can be defined as a practice or combination of practices determined to be the most effective, practicable means of managing forest lands for a variety of purposes, including timber production. Voluntary compliance with BMPs by a landowner or operator normally exempts the land from state regulatory action or provides the landowner with favorable treatment of some kind by the state. However, no regulation of forest practices exists in Indiana for any reason, and no means of providing favorable treatment for forest landowners by the state for voluntary compliance with BMPs is currently in place. So the incentive for compliance would be small. Further, while at least one group is working on developing BMPs, the fact is they are not yet operational or recognized in any official way.
3. Enact a state forest practices act. A state forest practices act could be enacted which would regulate management activities on private lands. Since there is considerable experience in the design, content, and implementation of state forest practices acts, it would be a relatively simple matter to prepare one for consideration by the State Assembly. Nevertheless, regulation of forest practices is very costly to implement. Further, government regulation is opposed philosophically by some, being considered an infringement upon their property rights. Finally, experience indicates that while regulation is reasonably successful in achieving a minimum standard of performance, it is not successful in achieving much beyond the minimum.
4. Provide financial incentives to forest landowners to improve management on their lands. If it is desirable to raise the level of management on private forest lands in Indiana, the most direct way is by providing forest landowners with a financial incentive for doing so. The cost of such a program would be substantial, however, and would have to compete with other programs for public funds or favorable tax treatment.

Riparian Zone Protection and Management

Public Policy Problem: Riparian zones are generally degraded in Indiana, reducing water quality, fish and wildlife habitat, and associated human recreational activities.

Public Policy Alternatives:

1. Develop and implement landowner education and technical assistance programs. Landowner education and technical assistance programs could be developed and implemented with regard to riparian zone protection, management, and rehabilitation. While such a program would be comparatively inexpensive, it would provide little incentive for a landowner to protect and manage riparian zones on his or her property, much less rehabilitate them.
2. Regulate human activity in riparian zones. Regulation of human activity in riparian zones could achieve a minimum standard of protection. It would be costly to administer, however. An important issue would be what level of government could most effectively regulate riparian zone protection. Riparian zones shared by two or more states would be best regulated by the federal government, while those involving only one state would be best regulated by state government. Where a riparian zone begins and ends would be an important administrative problem which would have to be addressed as well as federal-state coordination of regulatory activities.
3. Provide financial incentives. Financial incentives for landowners could be used for riparian zone protection, management, and rehabilitation. Landowners who would engage in such activities would receive financial assistance. The problem with all such programs is cost. Further, some might object to giving financial incentives for riparian zone protection with tax revenues, arguing that the public should not pay for something the landowner has the responsibility to do.
4. Acquire key riparian zones. Public ownership of key riparian zones would ostensibly insure their protection. The cost of acquisition would be problematic, however, as would the cost of maintenance.

Shrinking of the Forest Land Base in Indiana:

While forest acreage in the state has increased, accessibility for timber harvesting is another matter. Many forest lands have been developed in the sense they have become sites for recreational homes and are, hence, inaccessible for timber harvesting. Increasing urban and suburban expansion also tends to work against the accessibility of forest land for timber harvesting. On the other hand, many lands that are accessible for timber harvesting have been poorly managed and contain low quality timber.

Public Policy Problem: The forest land base accessible for timber harvesting and containing quality timber is shrinking.

Public Policy Alternatives:

1. Develop and implement forest management best management practices. BMPs have been developed in various states primarily as a means of meeting water quality standards developed under provisions of the Federal Water Pollution Control Act Amendments of 1972. BMPs can also be developed as means of achieving a variety of forest management standards. Voluntary compliance with BMPs by a landowner or operator normally exempts the land from state regulation of forestry practices, or provides for some favorable treatment by the state. As mentioned above, no such regulation and no means of providing favorable treatment exists in Indiana, however, so the incentive for compliance would be small.
2. Regulate forest practices. State regulation of forestry practices is effective in establishing minimum standards of forest management. Zoning, a form of regulation, could be used to insure that forest lands are not converted to some other use, that they are maintained in forest cover.
3. Subsidize through cost sharing or favorable tax treatment. Subsidization through cost sharing or favorable tax treatment of expenses associated with reforestation or timber stand improvement can bring about a significant improvement in forest management. It has been successful in several states and, to some extent, at the national level. Unfortunately, such a program is also costly to implement and administer.

Wetlands

The principal federal law that regulates wetland use is section 404 of the Federal Water Pollution Control Act Amendments of 1972, which regulates the filling and dredging of U. S. waters. More recent legislation designed to protect wetlands includes the "swampbuster" provision of the 1 98~ Food Security Act, which eliminated federal farm subsidies to farmers who grow crops on agricultural land converted from wetlands after 1985. The 1990 Farm Bill amended the "swampbuster" provision to change the timing of a swampbuster violation, from the time of planting on a filled wetland to the time of draining for agricultural purposes.

Current debate on wetlands has been on the definition for purposes of section 404. In 1989, the Environmental Protection Agency and the Army Corps of Engineers, among others, published the "Federal Manual for Identifying and Delineating jurisdictional Wetlands," which was met with much criticism for being too far- reaching. Implementation of the definition in the 1989 Manual was prohibited in a provision of the Energy and Water Development Appropriations Act of 1991. This compelled the Corps of Engineers to use the definition of wetlands contained in its 1987 manual titled "Wetlands Delineation Manual" (U. S. Corps of Engineers I. A subsequent attempt to revise the 1989 manual in 1991 was also rejected. The issue continues at an impasse. In the meantime, use continues of the definition in the 1987 Manual, which considers soil type, vegetation type, and saturation periods. A study of wetlands delineation by the National Academy of Sciences was authorized, completed, and is under review at the time of writing. It will be used by Congress and implementing federal agencies, ostensibly at least, in developing a new definition.

Public Policy Problem: Protection of wetlands is at an impasse because of the inability of federal agencies, Congress, and prominent interest groups to agree on an operational definition of wetlands for purposes of implementation of section 404 of the Federal Water Pollution Control Act Amendments of 1972.

Public Policy Solutions:

1. Delineate wetlands through administrative rule-making. The agencies with responsibility for implementation of the Federal Water Pollution Control Act Amendments of 1972 could delineate wetlands through the Administrative Procedure Act. The challenge, of course, is the power of the respective interest groups involved and their influence on members of Congress. Regulation of wetlands is viewed as a taking issue by those groups who are developmentally oriented, and they are demanding compensation for landowners for their perceived economic losses.
2. Delineate wetlands through statute.Congress could delineate wetlands by statutory means, but it would force a major public policy debate on property rights and the taking issue which many members of Congress want to avoid.

Combining Issues and Policy Solutions

Similarly, the generic solutions have been presented as if they are separate, distinct, and unconnected. But they can be and usually are combined in addressing a public policy problem. For example, general education programs, landowner technical assistance programs, and regulation are usually combined in a comprehensive program to improve forest practices.

If the citizens and public policy decision makers of Indiana want to address the forest policy issues facing the state, a comprehensive approach is recommended as is concerted application of various forms of government intervention.

Conclusion

Literature Cited

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Brewer, G D. and P. deLeon. 1983. The Foundations of Policy Analysis. Brooks/Cole Publishing Company, Pacific Grove, California

Clawson, M. 1975. Forests for Whom and for What? Published for Resources for the Future, Inc., by The Johns Hopkins university Press, Baltimore, Maryland. Dunn. W. N.. 1994. Public Policy Analysis. Second edition. Prentice Hall, Englewood Cliffs, New Jersey.

Patton, C. V., and D. S. Sawicki. 1993. Basic Methods of Policy Analysis and Planning. Second edition. Prentice Hall, Englewood Cliffs, New Jersey.

Roberts, S. D., J. B. Dunning, and B. K. Miller. 1995. Management of Biological Diversity in the Central Hardwood Region. FNR-147, Department of Forestry and Natural Resources, Purdue university, west Lafayette, Indiana.

Society of American Foresters. 1991. Task Force Report on Biological Diversity in Forest Ecosystems. SAF 91- 03. Society of American Foresters, Washington, D.C.

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U. S. Army Corps of Engineers. 1987. Corps of Engineers Wetlands Delineation Manual Technical Report Y-87- 1. Waterways Experiment Station, Vicksburg, Mississippi.

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