A forest that is funded out of 100 percent of its net receipts will tend to set its costs equal to its net. Since net plus costs equal gross, if costs equal net then costs will tend to be about half of gross. Yet funding out of net produces very different incentives than funding out of half of gross. The Oregon Department of Forestry is funded out of 36 percent of its gross receipts, while the Washington Department of Natural Resources is funded out of 25 percent of its gross. To the extent that all resources are priced in the market place, the answer is yes.
Maximum profit indicates that the public is getting the maximum net benefit out of the forest.
If spending money on revenue-producing activities is harmful to nonmarketable resources, then profit maximization may be the best solution since it leads to the lowest budgets. Pilots 1 and 4 also contain special funds for nonmarket stewardship activities. The Forest Options Group recognizes that the self-nomination process will pose a dilemma for national forests. Yet the Forest Options Group strongly believes that all options must be tested. The pilot project advisory committee must insure that pilots cover the full range of budgeting options.