Effect of COVID-19 on Federal Land Revenues

Four major federal land management agencies administer 606 million acres (95%) of the federal land in the United States (approximately 640 million acres). These agencies are the Bureau of Land Management (BLM), U.S. Fish and Wildlife Service (FWS), and National Park Service (NPS) in the Department of the Interior (DOI) and the Forest Service (FS) in the Department of Agriculture. In addition, the Bureau of Ocean Energy Management (BOEM), in DOI, manages access to approximately 1.7 billion offshore acres in federal waters on the U.S. outer continental shelf. The agencies administer their lands for a variety of purposes, primarily related to conservation, recreation, and development of natural resources. This report focuses on the potential impacts of the Coronavirus Disease 2019 (COVID-19) pandemic on certain revenue-generating activities, federal payment and revenue-sharing programs, and federal assistance programs administered by these resource-managing agencies. The resource-managing agencies are authorized to charge fees and generate revenue from many of the uses and services provided on the federal lands they manage. Revenue-generating activities include recreation; concessions and commercial visitor services; energy development, both onshore and offshore; livestock grazing; and timber harvesting. The revenue may be allocated in various ways to support diverse purposes. Some allocations are made to the resource-managing agencies to offset costs of specific activities, such as recreation and visitor services. Other allocations are to the General Fund of the U.S. Treasury to support governmental functions generally; still other allocations are to special funds established by Congress for particular activities, such as historic preservation or land acquisition. During the COVID-19 pandemic, the five agencies have experienced varying degrees of disruption to the continuity of revenue-generating activities on their lands and programs they administer. If reduced activity or fee payments result in less revenue generated on federal lands, the decrease could affect the agencies, general and special funds, and activities sharing in the revenues. More broadly, the general public, communities near federal lands, and businesses and industries that use or purchase resources from federal lands could feel the effects of such a decrease in activity or revenue. In some cases, the resource-managing agencies are required to share revenues with state and local governments. State and local governments also receive payments through various other programs based on the extent of federal acreage within their jurisdiction or other factors. The basis, distribution, recipients, and authorized uses of these revenue-sharing and other payment programs differ widely. For the revenue-based payments, lower revenues from federal lands likely would affect the level of payments to states and local governments. For most payments, however, the effect would not be apparent until the following fiscal year (e.g., FY2021, for revenue fluctuations in FY2020). The potential for COVID-19 to affect the nonrevenue-based payments is less clear. An issue for some of the nonrevenue-based payments has been uncertainty related to program and funding authorization. In addition, because some of the revenue-based and nonrevenue-based payments are funded through offsetting receipts, another potential issue is that any reduction in receipts also may reduce the availability of funds to cover the payments’ costs. Some of the resource-managing agencies also administer programs that provide assistance to states and territories for conservation-related and other activities through grants or other financial or technical assistance. Two such programs are the Pittman-Robertson Wildlife Restoration Program and the Dingell-Johnson Sport Fish Restoration Program. FWS administers these two programs, which are funded through revenues from excise taxes and/or import duties for specific items. The COVID-19 pandemic could affect these programs in various ways, including by altering the amount of revenue generated, allocations to states and territories, and recipients’ ability to use allocated funds. It is unclear, however, the extent to which any effect of COVID-19 on these programs may be representative of impacts on assistance programs generally. The effects of COVID-19 on revenue-generating activities, federal payment and revenue-sharing programs, and assistance programs administered by these agencies raise an array of potential issues for Congress. Generally, these issues include whether to counteract any decreases in revenues, payments, or funding for assistance programs; provide for additional flexibilities or direct relief for entities that operate on federal lands or purchase federal resources; or alter cost-share and obligation requirements for recipients of assistance programs. To address these issues, Congress could provide additional appropriations or amend the programs in diverse ways to mitigate the impacts. Congress may decide that some issues do not warrant legislative action, or it may prefer to address these issues in the future, depending on the duration, scope, and scale of the pandemic and related impacts.