1. Stewardship Agreements
Jim Innes, Forest Service Region 1 Stewardship Coordinator
Meg Roessing, Forest Service National Stewardship Contracting Coordinator
Marko Bey, Lomakatsi Restoration Project
Luann Waida, Region 2 Grants and Agreements Specialist
Tera King, Northwest Management, Inc.
National Forest Foundation

2. Emphasis of Stewardship
Responsible management of resources
End results contracting
Best-value
Collaboration
The Emphasis of Stewardship
The definition of stewardship is a land ethic that promotes the responsible planning and management of resources. Stewardship end results contracting emphasizes best value contracting and collaboration with the goal to have the best on the ground results possible. Best value contracting allows for the forest service to choose a contractor for reasons other than price, such as past performance and technical ability.
Collaboration allows the Forest Service to develop the best possible project by getting early public input from variety of stakeholders. Collaboration can consist of working with a developed collaborative such as the MFRC or CBC and/or local landowners, local tribes and community leaders.

3. Emphasis of Stewardship
Trade goods for services
Goods are traded 1:1 for work
No overhead costs
The Emphasis of Stewardship
Stewardship also allows for goods (timber) to be traded on a 1:1 basis for service (stewardship work). Those funds are not subject to overhead costs to pay for Forest Service program administration and support.

4. Land Management Goals
Road and trail maintenance or obliteration to restore or maintain water quality;
Soil productivity, habitat for wildlife and fisheries, or other resource values;
Setting prescribed fires to improve composition, structure, condition, and health of stands or to improve wildlife habitat;
Removing vegetation or other activities to promote healthy forest stands, reduce fire hazards or achieve other land management objectives;
Watershed restoration and maintenance;
Restoration and maintenance of wildlife and fish habitat; and
Control of noxious and exotic weeds and reestablishing native plant species. 
In the current legislation there are 7 land management goals. They are fairly general and there is some redundancy, but they roughly follow 4 main themes, water quality improvement, stand health (thinning and fire), habitat improvement, and noxious weed control.
Road and trail maintenance or obliteration to restore or maintain water quality; ---This is a goal that has a water quality theme
Soil productivity, habitat for wildlife and fisheries, or other resource values; ----This is a broader management goal with an emphasis on soils rehabilitation, which typically involves de-compaction of soils, such as on old roads or log landings
Setting prescribed fires to improve composition, structure, condition, and health of stands or to improve wildlife habitat; ---This management goal is for stand health with an emphasis on prescribed fire.
Removing vegetation or other activities to promote healthy forest stands, reduce fire hazards or achieve other land management objectives; ---This management goal is for stand health with an emphasis on fuel reduction and thinning.
Watershed restoration and maintenance; ---a water quality management goal.
Restoration and maintenance of wildlife and fish habitat; --a habitat improvement management goal
Control of noxious and exotic weeds and reestablishing native plant species. -- Control of noxious weeds

5. Land Management Goals
Stewardship legislation references timber management in the context of stand health and fuels reduction
The land management goals emphasize that the intent of stewardship contracting is good land management
Its important to note that the stewardship legislation references timber management activities in the context of stand health and fuel reduction, not in the context of revenue generation to fund stewardship work. This Emphasizes that the intent of all the activities in a stewardship contract are in the interest of good land stewardship. In addition timber removal as the trade of goods for services is not in itself common to all stewardship projects.

6. Stewardship contract types
Types of stewardship contracts
Integrated Resource Timber Contract (IRTC)
Integrated Resource Service Contract (IRSC)
Stewardship service contract
Stewardship Agreement
Now we will move on to stewardship contract types
There are 4 types of stewardship contracts. The integrated resource timber contract (IRTC), the integrated resource service contract (IRSC), Stewardship service contract and a stewardship agreement (SA).
We will be focusing on the 4th type: Stewardship Agreements

7. Stewardship Agreement - Primary Test
Partnership Authorities and Instruments January 2007
Stewardship Agreement - Primary Test
Is the project for the mutual interest and benefit of the parties?
Does it advance the mission of the proposed partner, other than for monetary gain, and achieve the FS management goals for the national forests that meet local & rural community needs?
Factors for determining application of a stewardship agreement
The Stewardship Handbook states that the primary test for determining whether or not an agreement is appropriate for your stewardship project, is that you and your potential partners must have mutual interest and benefits.
These interests and benefits must be other than monetary. In considering such, the missions and goals of potential partners are to be evaluated to identify common interests and benefits.
203 Partnership Authorities and Instruments

8. Stewardship Agreements – value of services exceed product value or value of products exceed value of service. It can go either way.
Agreement – who’s project is it and is there a cost sharing opportunity?

9. Stewardship Agreements
Achieve the land management goals of the Authority
Focus on end result
Mutual benefit (not monetarily) and mutual interest
Voluntary - on both sides
Flexible – termination clauses, can be modified at any time
Exchange goods/funds for services
Based on best value
Life of agreement cannot exceed10 years
Not competitive
Achieve the land management goals of the Authority
Focus on end result
Mutual benefit (not monetarily) and mutual interest
Voluntary - on both sides
Flexible – termination clauses, can be modified at any time
Exchange goods/funds for services
Based on best value
Life of agreement cannot exceed10 years
Not competitive

10. Stewardship Authority
Only the Regional Forester has the authority to approve stewardship projects in the Region for the Forest Service.
The Forests submit their proposals and they are reviewed and approved or denied.
Approval is based on whether they meet the intent of the stewardship legislation.
Stewardship Authority
Only the Regional Forester has the authority to approve stewardship projects in the Region for the Forest Service.
The process is that The Forests submit their proposals and they are reviewed, by Jim and are approved or denied.
Approval is primarily based on whether they meet the intent of the stewardship legislation, specifically one or more of the 7 land management goals. In addition they must also meet the Handbook direction.

11. Partners State and local governments Tribes Non-profits
Partners can be:
State and local governments
Tribes
Non-profits
The partner is the entity that has the mutual interest and mutual benefit and will be responsible for the cost sharing requirements. The partner roles will be clearly defined in the agreement. I will talk about those roles in a few slides.

12. Mutual interest and mutual benefit
“in the same qualitative way”
What does that mean?

13. Mutual interest
Each party has a need for, and an interest in, the jointly agreed upon project goals and deliverables; and
The parties pool their resources to carry out the project and obtain the deliverables.
Each party has a need for, and an interest in, the jointly agreed upon project goals and deliverables; and
The parties pool their resources to carry out the project and obtain the deliverables.
Just because there is mutual interest, there isn’t necessarily mutual benefit.

14. Mutual benefit
Reflects a relationship when the parties have a shared interest, contribute resources, and mutually benefit (other than monetarily) from the objective of the agreement.
Reflects a relationship when the parties have a shared interest, contribute resources, and mutually benefit (other than monetarily) from the objective of the agreement.
Partnering organizations cannot “make money” on the agreement. Excess funds must go towards additional services (reinvested) or they go back to the Treasury.

15. Stewardship Agreement
Contract between the FS and a partner(s)
May or may not include timber removal
All parties share a mutual interest and benefit
20% minimum funding by partner
Work can be accomplished on non-FS lands that benefit the FS (Wyden amendment)
No trust funds or retained receipts
A stewardship agreement is a contract between the Forest Service and a partner. The contract may or may not include timber removal. Stewardship work on the agreement is determined by the 2 parties and executed such that there is mutual interest and benefit in the outcome of the work. Funding is split 80/20 with the Forest Service covering 80% and the Partner 20%. However, the funding split should reflect the benefit that the forest service or partner is receiving. For example, if the Forest Service is doing all the work on the partners land the partner should be contributing more than 20% since they are receiving the greatest benefit and visa versa.
Under the Wyden amendment work can be accomplished across ownership boundaries. For example the Forest Service could replace a culvert on private land if it was determined that it would benefit federal land to do so. An example of this could be decommissioning a road on private land that is contributing sediment to a stream on federal land. The Wyden amendment recognizes that resource issues do not stop at property lines.
There are no trust fund collections or retained receipts on these contracts. If extra receipts are generated the Forest Service and Partner can agree to add more stewardship work.
Stewardship agreements are fairly flexible contracts. They are appropriate for projects where there is good collaboration and partnerships. The projects that agreements are used for don’t have to all be identified up front prior to developing the master agreement only the scope of work and the project area needs to be known, the specifics are identified in each supplemental project agreement.

16. Forms Master Stewardship Agreement with SPA Stewardship Agreement
Use for larger stewardship areas
Address a series of projects that are identified in the SPAs
Stewardship Agreement
Use for individual “stand alone” or smaller projects
Stewardship Agreement –short form
Use to accomplish stewardship restoration activities utilizing retained receipts only, without product value
No goods for services component
The contract has 2 parts, a master agreement , which is a short page document that outlines how the partners will work together. Under the master agreement is the supplemental project agreement which outlines in detail the specifics of that individual project.
Templates are available.

17. Who is on the Team? Stewardship Coordinator
Timber Sale Contracting Officer
Timber Resource Staff
Resource Specialist(s), e.g. wildlife biologist, hydrologist, etc.
Grants and Agreements Specialist
Partner(s)
Partner’s Partners
Stewardship Coordinator
Timber Sale Contracting Officer
Timber Resource Staff
Resource Specialist(s), e.g. wildlife biologist, hydrologist, etc.
Grants and Agreements Specialist
Partner(s)
Partner’s Partners

18. Cost Sharing - 80/20 Split 80% Forest Service, 20% Partner match
Based on total project value less the value of timber
Cover partners actual expenses as agreed using appropriated funds, retained receipts, or a combination of the two
Match Contributions can be:
In-kind, non-cash, cash, etc…
Cannot match federal dollars to federal dollars
Partners contribution must commensurate with the benefits gained
The stewardship authority does not require a match; however, FS policy for agreements requires a minimum 20% match. The Regional Forester does have the ability to revise the match requirement.
Match requirement is based on the total project value (including FS costs) less the value of the timber. If the timber was included this would increase the match requirement above what most partners could afford, i.e. it would be prohibitive.
Funding sources used by the partner:
Product Value (goods for services): Revenue generated from the sale of forest products above and beyond the Partner’s purchase, removal and haul costs. Receipts not utilized by the Partner on the project are returned to the Forest Service as retained receipts.
Cash Contributions: The Forest Service may reimburse the Partner for actual costs incurred on the project, as agreed upon and available. Appropriated funds, retained receipts, or a combination of the two may be used. These details will be agreed upon when negotiating the Financial Plan.
Noncash Contributions: There are elements of a project that have a cost (expense) to the Partner which the Forest Service is NOT reimbursing. These expenses could be salary, supplies, equipment, indirect, etc. utilized on the project. This is also where the Partner would capture third party cash contributions (e.g. non-Federal grants) utilized within their organization. These are all considered non-cash contributions.
 In-Kind Contributions: Include services, supplies, and equipment donated to the project without cost to the Partner.
Other Federal Contributions: Include federal funds provided to the Partner.

19. Steps to Designing a Stewardship Agreement
FS develops stewardship project proposal
Stewardship proposal is approved by the RF
Partner prepares a technical proposal – this may be done in collaboration with FS
FS evaluates technical proposal to determine that Stewardship Agreement provides the best value
FS and Partner finalize technical proposal
Complete Environmental Analysis documents
Stewardship Agreement including financial plan and all appendices are completed
Technical proposal includes description, who will contribute what, what are responsibilities, deliverables, reporting requirements, monitoring requirements
– subject to negotiation at any time during the life of the agreement.
No single approach for negotiating agreements.
Not entirely sure of NEPA phase occurs before or after agreement is finalized?

20. Challenges Agreement is not contractual Financial Plan Monitoring
Very complicated - specifies who will be paying for what and how much
Specifies match requirement, which over the long-term can be difficult for partners (sustained interest, cash flow issues)
Anything involving timber valuation is going to be complicated
Monitoring
Above and beyond typical agreement monitoring
Rigorous match documentation
Partner also has to monitor contracts for implementation work
Unlike contracts, Stewardship Agreements are voluntary and non-binding. Except for provisions necessary for legal compliance as specified in federal law, all elements of an agreement are subject to negotiation and modification at any time. In addition, either party may terminate any part of an agreement during the period of performance.
Product Value:
When negotiating the product appraisal and unit rates, estimates may be used up to the point where work begins. The product value should reflect the current market value – therefore, an appraisal should be done just prior to implementation. Once the product has a final appraisal, the Stewardship Agreement is modified. The final product value (or appraisal) cannot be revised once agreed to under a modification. The product's contribution toward service work would not change. 
 A rate redetermination for service work under an agreement could occur anytime a new factor warrants a change. This would require that the agreement be modified.  If the redetermination results in higher cost, more cash would be required to accomplish the same work since the product portion could not change. If no funding is available to maintain original projected work, then a modification to increase the unit rate would also include a reduction in the project scope (acreage treated).
When an appraisal is completed the Financial Plan should be modified to capture the revised amount with offsetting service work. Modified product values (the final appraisal) shall be greater than or equal to the tentative value and cannot change. It is important to coordinate closely with timber staff to ensure that the correct appraised value or bid rate, whichever is greater, is used. Generally the full amount of the product value will be exchanged for stewardship service items.
Once a final appraisal has been performed, the agreement shall be modified to incorporate the value. The final product value is not subject to negotiation or modification. However, the unit rate for services performed can be renegotiated when Partner costs are higher than initially estimated. The likely result is a reduction in work performed if additional funding is not available

21. Benefits of the Agreement
FS and partners can identify high priority project areas within stewardship area
Long term, landscape scale commitment to work in stewardship area
SPA can be modified based upon changed project conditions (conditions or availability of resources)
Provides the opportunity to pursue/secure additional resources
Simplifies acquisition process (mods vs contracts)

22. Benefits of the Outcomes
Expand partners capacity (dollars and manpower)
Collaboration/partner involvement
Mutual interest/mutual benefit
Increased support, decreased opposition within the community
Generate more resources for project work
Opportunity to utilize partner resources (in-kind, goods for services, grants, partner contributions)
More projects and increase local economic benefits
Integration increases scale and scope of project
Provides long-term opportunities for local contractors
Forest moves closer to meeting Forest Plan goals
Goods and services respond to local needs

23. Words of Wisdom
Clearly define all partners’ roles and responsibilities
Make sure funding has been secured for the development of the MSA/SPAs, which can take a long time
Ensure FS leadership/team has adequate time allocated and budgeted
Ensure the availability of FS support personnel
Make sure lines of communication between all partners are wide open
Establish clear timelines and deliverables

25. Example - Implementation
Project admin, inspections, oversight done collaboratively
Prescription development done collaboratively
Partners perform project (sales) preparation including layout, tree marking, tallying, etc.
Partners and FS select contractor using best value
Workforce training in ecological forestry is ongoing
Timber operators are hired for the forest restoration service (logging, roads, and material transport)
Partners administer forest product sales, purchase orders with mills and biomass facilities
FS and partners oversee on the ground operations and inspections