SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Forest Ecosystem Stewardship 
Demonstration Act of 1995''.

SEC. 2. FINDINGS, PURPOSES, AND DEFINITIONS.

    (a) Findings.--Congress makes the following finding:
            (1) In many of the units of the National Forest System, 
        current conditions--such as unnatural fuel loads, high tree 
        density, threat of catastrophic fires, disease, and insect 
        infestations, habitat loss, and loss of historic species, stand 
        diversity and integrity--adversely affect the biodiversity, 
        health, and sustainability of the forest ecosystems of such 
        units.
            (2) A new and innovative contracting process for the 
        National Forest System is required to meet Federal goals of 
        improving forest resource conditions through implementation of 
        ecosystem management.
            (3) Ecosystem management is not just a biological concept. 
        It is the convergence of a set of activities that is 
        simultaneously ecologically sound, economically viable, and 
        socially responsible.
            (4) The improvement of the health and natural functioning 
        of the forest resource is vital to the long-term viability of 
        species found on National Forest System lands.
            (5) Ecosystem restoration and conservation work performed 
        with revenues from forest activities would improve employment 
        opportunities in communities near units of the National Forest 
        System to the benefit of long-term economic sustainability and 
        community viability.
    (b) Purposes.--The purposes of this Act are as follows:
            (1) To improve and restore the health of forest resources 
        through implementation of ecosystem management.
            (2) To provide for employment opportunities and economic 
        health and viability for rural communities near units of the 
        National Forest System.
            (3) To provide for flexibility in procurement and funding 
        practices to enter into stewardship contracts to achieve 
        management objectives and requirements prescribed in the 
        following provisions of law:
                    (A) The Act of June 4, 1897 (commonly known as the 
                Organic Administration Act; 16 U.S.C. 473-475, 477-482, 
                551).
                    (B) The Multiple-Use Sustained Yield Act of 1960 
                (16 U.S.C. 528-531).
                    (C) The Forest and Rangeland Renewable Resources 
                Act of 1974 (16 U.S.C. 1600-1614).
                    (D) Section 14 of the National Forest Management 
                Act of 1976 (16 U.S.C. 472a).
                    (E) The Act of May 23, 1908, and section 13 of the 
                Act of March 1, 1911 (16 U.S.C. 500).
                    (F) The Federal Grants and Agreements Act of 1977 
                (31 U.S.C. 6303-6308).
                    (G) National Forest Fund Act of March 4, 1907 (16 
                U.S.C. 499).
    (c) Definitions.--For purposes of this Act:
            (1) Account.--The term ``Account'' means the Stewardship 
        Account established under section 4.
            (2) Design specification contract.--The term ``design 
        specification contract'' is used to describe contracts in which 
        the contracting entity specifically identifies all the tasks to 
        be performed, and the contractor performs per the designed 
        specifications.
            (3) Forest stewardship council.--The term ``Forest 
        Stewardship Council'' means any one of the local councils 
        established under section 3(f) of this Act to, in cooperation 
        with resource managers: prioritize and select stewardship 
        projects, set operational goals in the context of current 
        national forest management policies and local forest plans, 
        evaluate contractor performance and accomplishments, recommend 
        progress payments for work successfully completed by 
        contractors, and make recommendations for the improvement of 
        the stewardship contract process.
            (4) Performance specification contract.--The term 
        ``performance specification contract'' is used to describe 
        contracts in which the contracting entity identifies the 
        parameters of the project, and the contractor identifies the 
        method to accomplish the work.
            (5) Resource activities.--The term ``resource activities'' 
        includes area access, site preparation, replanting, fish and 
        wildlife habitat restoration or enhancement, silvicultural 
        treatments, watershed improvement, fuel treatments (including 
        prescribed burning), and road closure or obliteration.
            (6) Resource manager.--The term ``resource manager'' refers 
        to the line officer responsible for management decisions 
        associated with project implementation on a national forest.
            (7) Roadside sale.--The term ``roadside sale'' refers to 
        the sale by the Forest Service to the highest bidder(s) of all 
        contract-designated products of the forest removed as part of 
        the management activities conducted under a stewardship 
        contract. (Non-designated products may be assigned to the 
        contractor for salvage.) A roadside sale is a completely 
        separate transaction from the awarding of the stewardship 
        contract itself.
            (8) Secretary.--The term ``Secretary'' means the Secretary 
        of Agriculture.
            (9) Statement of work contract.--The term ``statement of 
        work contract'' is used to describe contracts in which the 
        contracting entity gives a general overview of the project, and 
        the bidding contractor provides the specifics on how he/she 
        envisions the project and the end result he/she would obtain 
        using his/her particular approach to land stewardship.
            (10) Stewardship contract.--The term ``stewardship 
        contract'' means a contract for carrying out resource 
        activities for the improvement and restoration of forest 
        ecosystems of units of the National Forest System and to 
        encourage or enhance the economic sustainability and the 
        viability of rural and regional communities. A stewardship 
        contract could use a design specification format (definition 2, 
        above), a performance specification format (definition 4, 
        above), a statement of work format (definition 9, above), or 
        some combination thereof.

SEC. 3. USE OF STEWARDSHIP CONTRACTS.

    (a) Use Authorized.--The Secretary shall establish and implement in 
the Forest Service a demonstration program through which forest- and/or 
district-level resource managers use stewardship contracts to carry out 
resource activities in a comprehensive manner to restore and preserve 
the ecological integrity and productivity of forest ecosystems within 
the National Forest System and to encourage or enhance the economic 
sustainability and the viability of nearby rural communities. The 
resource activities undertaken should be consistent with the precepts 
of ecosystem management and with the forest's management plan for 
achieving the desired future conditions of the area being treated.
    (b) Use Limited.--Within the limits of available financial 
resources, each forest within the National Forest System may use 
stewardship contracts to carry out ecosystem management projects, if 
those contracts:
            (1) Provide for payment to the contractor based on the 
        number of acres satisfactorily treated in accordance with an 
        approved plan to create a desired future condition on the land.
            (2) Are used for projects where the harvest of timber is 
        secondary to creating specific resource conditions (e.g., 
        wildlife habitat enhancement, watershed improvement, insect and 
        disease control).
            (3) Are not used for projects involving the construction of 
        new permanent roads or entries into roadless areas.
            (4) Will result in the removal of no more than 300,000 
        board feet of merchantable timber per project.
            (5) Provide for the roadside sale of all contract-
        designated merchantable timber which is extracted.
            (6) Are awarded competitively to qualified contractors with 
        no more than 25 employees.
            (7) Include stewardship skill and experience qualification 
        requirements which have been established by the local Forest 
        Stewardship Council and approved by the Forest Service.
            (8) Are monitored not only by the Forest Service, but also 
        by the local Forest Stewardship Council.
            (9) Provide for periodic progress payments to contractors 
        based on successful completion of contract activities on a per 
        acre basis. The acceptability of the contractor's work shall be 
        determined by the Forest Service, taking into account the 
        recommendation of the local Forest Stewardship Council.
    (c) Demonstration Research Objectives.--The Secretary shall insure 
that in the carrying out of the provisions of this Act enough 
flexibility is provided to resource managers to enable them to test 
various approaches to solving questions left unresolved in previous 
demonstrations of stewardship and end results contracts authorized in 
fiscal year 1991 and 1992 through the Department of the Interior and 
Related Appropriation Acts. These questions include, but are not 
limited to:
            (1) The need for the bonding of stewardship contractors 
        and/or possible alternatives which could reduce the financial 
        burden on small businesses.
            (2) Preferred methods of marketing timber or other products 
        of the forest removed as a result of stewardship contract 
        activities.
            (3) The standards to be used in evaluating the quality and 
        acceptability of the work performed by a stewardship 
        contractor.
            (4) The desirability of multi-year contracts for 
        stewardship projects.
            (5) The relative merits of using design specifications, 
        performance specifications, or statements of work in offering, 
        awarding, and evaluating stewardship contracts.
            (6) The costs, benefits, problems, and opportunities 
        resulting from increased community involvement in the design 
        and monitoring of stewardship contracts.
            (7) The benefits and problems resulting from restricting 
        stewardship contracts to very small (no more than 25 employees) 
        contractors.
            (8) The extent to which local economic sustainability and 
        rural community viability are affected by the use of 
        stewardship contracts.
            (9) The difference between estimated and actual revenues 
        derived from roadside sales of timber.
            (10) The level of utilization of timber and other products 
        of the forest derived from stewardship contract projects as 
        compared with conventional timber sales.
            (11) The extent to which stewardship contracting 
        contributes to the achievement of forest ecosystem management 
        plans.
            (12) The extent to which the revenues from stewardship 
        contracts cover the cost of such contracts or are offset by the 
        costs which could reasonably be expected to result if the 
        contracts are not carried out (e.g., fire suppression costs in 
        areas with heavy fuel loads).
            (13) The administrative costs or savings involved in the 
        use of stewardship contracts.
            (14) The benefits and/or disadvantages of using local 
        Forest Stewardship Councils as part of the stewardship 
        contracting process.
            (15) The benefits and/or disadvantages of various methods 
        of selecting members, organizing, administering, and conducting 
        the business of local Forest Stewardship Councils.
    (d) Development and Use of Contracts.--Each resource manager of a 
unit of the National Forest System may enter into stewardship contracts 
with qualified non-Federal entities (as established in regulations 
relating to procurement by the Federal Government or as determined by 
the Secretary.) The local Forest Stewardship Council, in cooperation 
with the Forest Service resource manager, shall select the type of 
stewardship contract that is most suitable to local conditions. 
Contracts should clearly describe the desired future condition for each 
resource managed under the contract and the evaluation criteria to be 
used to determine acceptable performance. The length of a stewardship 
contract shall be consistent with the requirements of section 14 of the 
National Forest Management Act of 1976 (16 U.S.C. 472a).
    (e) Selection of Areas for Contracts.--In selecting areas within 
units of the National Forest System to be subject to stewardship 
contracts, the Secretary, resource managers, and local Forest 
Stewardship Councils shall base the selection on the need to improve 
forest health, maintain and improve soil and water quality, and improve 
fisheries and wildlife habitat. Priorities for activities within 
individual units will be established by local resource managers, in 
consultation with the appropriate local Forest Stewardship Council.
    (f) Establishment of Local Forest Stewardship Councils.--Local 
Forest Stewardship Councils shall be established for each unit of the 
National Forest System which offers stewardship contracts. The role of 
a Forest Stewardship Council will be to, in cooperation with the 
resource managers, prioritize and select stewardship projects, set 
operational goals in the context of current national forest management 
policies and local forest plans, evaluate contractor performance and 
accomplishments, recommend progress payments for work successfully 
completed by contractors, and make recommendations for the improvement 
of the stewardship contract process. Each participating National Forest 
System unit shall establish, after soliciting the comments of local 
citizens, the size of the local council, the method of selection or 
election of council members, the terms of service of members, and the 
council administrative budget, if any. At least 51 percent of members 
of any Forest Stewardship Council shall be drawn from the private 
sector, in a manner which insures representation of a broad range of 
public interests. The functioning of the Forest Stewardship Councils 
must assure a continuing and open process and must in no way interfere 
with the broad public involvement in Federal resource management 
decision making required under the National Environmental Policy Act of 
1976.
    (g) Application of Contracts.--Subject to subsection (h), the 
revenue received from the sale of timber or any other products of the 
forest resulting to the Federal Government as a result of work carried 
out under a stewardship contract shall be deposited into a Stewardship 
Account as established in section 4(a).
    (h) Effect on Other Revenue Requirements.--Twenty-five percent of 
the revenues received from roadside sale of products extracted through 
stewardship contract activities shall remain available for payments to 
States, as required under the Act of May 23, 1908, and section 13 of 
the Act of March 1, 1991 (16 U.S.C. 500). The Secretary shall first 
collect revenues to make such payments before exercising the authority 
provided in subsection g.

SEC. 4. STEWARDSHIP CONTRACT RECEIPTS AND EXPENDITURES.

    (a) Receipts.--Monetary receipts received as payment for contract-
designated timber and other products of the forest extracted through 
stewardship contract activities shall be deposited in a designated fund 
to be known as the ``Stewardship Account''. Amounts in the Account 
shall be used to make payments to States under the Act of May 23, 1908, 
and section 13 of the Act of March 1, 1911 (16 U.S.C. 500), and to fund 
resource activities. Amounts in the Account are hereby appropriated and 
shall be available to the Secretary until expended, except that those 
amounts found by the Secretary to be in excess of the needs of the 
Secretary shall be transferred to miscellaneous receipts in the 
Treasury of the United States. Any additional revenues made available 
through direct appropriations to the Forest Service for stewardship 
contracting and ecosystem management purposes also shall be deposited 
in the Account.
    (b) Expenditures.--Not less than 80 percent of amounts in the 
Account available for resource activities shall be used for the direct 
costs of such resource activities. The revenues received from sales of 
contract-designated products resulting from stewardship contracts shall 
be returned to the national forest from which they were generated, to 
be used to fund additional stewardship contracts. To the extent that 
additional revenues are received in the Account from direct 
appropriations by the Congress of funds for stewardship contract 
activities, such funds shall be made available to those forest units 
using stewardship contracts through a process to be developed by the 
Secretary.
    (c) Reporting.--As part of the annual report of the Secretary to 
Congress, the Secretary shall include an accounting of revenues, 
expenditures, and accomplishments related to the stewardship contracts.

SEC. 5. RELATION TO OTHER LAWS.

    All stewardship contracts shall comply with existing applicable 
laws, and nothing in this Act may be construed as modifying the 
provisions of any other law except as explicitly provided in this Act.

SEC. 6. EFFECTIVE DATE.

    This Act shall be effective upon passage.

SEC. 7. TERMINATION DATE.

    Unless extended by a subsequent act of the Congress, this Act shall 
terminate five years from its effective date.
Forest Ecosystem Stewardship Demonstration Act of 1995 - Directs the Secretary of Agriculture to establish and implement a Forest Service demonstration program of stewardship contracts (as defined in this Act) to restore and preserve forest ecosystems and to sustain neighboring rural communities' economic viability. 
Requires Local Forest Stewardship Councils to be established for each National Forest System offering stewardship contracts.
Forest Ecosystem Stewardship Demonstration Act of 1995