An independent auditor has found no funds were misspent when the Douglas County Board of Commissioners awarded Title III Secure Rural Schools dollars to Communities for Healthy Forests.
The finding, by audit manager Scott Muller of Salem-based Kenneth Kuhns & Co., was included in an audit of the county’s pass-through of all types of federal funds in the 2016-17 fiscal year.
The pass-through of Title III funds to Communities for Healthy Forests landed the county in the middle of controversy in September, after the nonprofit put a video online called “After the Fire is Out.” The video, which promotes salvage logging and replanting in forested areas ravaged by wildfire, was criticized by environmentalists as propaganda for the timber industry. But the county said the video qualifies for Title III money under a forest-related education category.
The Douglas County Board of Commissioners is under fire for spending federal timber safety n…
That particular video cost Communities for Healthy Forests about $6,000 to produce, money that came from a 2015-16 Title III grant. It has since produced a second, for about the same cost, called “Smoke!” In 2015-16, the county granted $190,000 to CHF. Some of the money went toward uncontroversial educational programs such as tree planting with school children. The budget submitted in the grant proposal for that year said $50,000 would be used for “educational videos production.”
The Kenneth Kuhns & Co. audit, dated March 30, 2018, covers the 2016-17 year. For that year, the county granted Communities for Healthy Forests $300,000. Under “uses of funds,” the grant application listed the biggest line item as “feature film funding,” at $200,000. About $50,000 of that was for CHF’s expenses overseeing the project.
Douglas County Chief Financial Officer Jessica Hansen said the auditor found no problems with the county’s Title III expenditures.
“We wouldn’t have got a clean audit if we had a problem,” she said.
Douglas County Commissioner Tim Freeman said he believed the expenditures were valid and responded to criticisms by promising the audit that was completed last week. On Thursday, he told The News-Review he was happy with the outcome.
“It’s nice to get the answer, to make sure what we’re doing is correct,” he said.
The controversy surrounding this grant hinged on the interpretation of what constitutes forest-related education. The full text of the relevant portion of the SRS law reads like this: “Forest related educational opportunities. — A county may use these funds to establish and conduct forest-related after school programs.”
Critics of the Communities for Healthy Forests grant interpret that to mean that only after-school programs qualify for forest-related education funds. Four opponents argued the county violated federal law by spending the funds on videos, and they contacted their Congressional delegation in November to request an investigation.
However, longtime Commissioner Doug Robertson, who continues to advise the county on timber issues and who, according to federal nonprofit tax exemption documents, has also served as a senior adviser to Communities for Healthy Forests, interprets the forest-related education category broadly. He said the verbiage indicating a county “may” use the funds for after-school programs is intended to show that after-school programs are just one possible type of education program authorized under the law.
Douglas County Commissioner Tim Freeman said this morning that the county plans to hire an i…
In preparing his audit, Muller specifically reached out to Leanne Veldhuis, national partnership coordinator for the U.S. Forest Service’s National Partnership Office, to seek an answer to the question of what counts as forest-related education and whether the feature film project would be an allowable expense under that category.
A series of emails between Veldhuis, Muller and Freeman show that the Forest Service refused to answer that question, instead tossing it back in the county’s lap.
“In answering the question about whether the county’s specific use of title III funds was authorized, we defer to the county and its auditor. While we have provided some guidance on the SRS website relating to the use of county funds under title III, as a general practice the Forest Service does not review specific uses of title III funds,” Veldhuis wrote.
Following that response, the auditors determined the expenditure was allowed.
Freeman pointed out that the county has been making grants under the forest education category to Communities for Healthy Forests for 11 years, and that multiple commissioners unanimously approved the expenditures. During that time, he said, federal agencies had the opportunity to object to the county’s expenditures and declined to do so.
The Forest Service has consistently refused to weigh in on whether the county’s interpretation of forest-related education is correct. Freeman provided copies of a 2012 report from the U.S. Government Accountability Office, and a 2017 audit from the Office of Inspector General of the USDA, which oversees the Forest Service.
Both the inspector general and the GAO called out the Forest Service and the Bureau of Land Management for failing to oversee the expenditures of counties receiving Title III funds. Without that guidance, the reports said, counties may be spending their funds in ways inconsistent with the Secure Rural Schools Act. The GAO also noted that what little guidance the Forest Service offered on its website was unclear, confusing and “directs the counties to consult their own legal counsel regarding the authorized uses of Title III funds.”
The Association of Oregon Counties, the Association of O&C Counties and their legal counsel, Kevin Davis, had issued their interpretation back in 2001 of how forest-related education funds could be spent. It’s a broad definition, going beyond after-school programs and including the catch-all category, “Other programs used to provide experiences to children and adults related to forest education.”
“Note that these programs can be for children or adults and can be conducted on or off school campuses. The primary restrictions are that the educational programs be forestry related and not be included as part of the curriculum during the school day,” they wrote.
In a letter to federal officials Thursday, a group of citizens called for an investigation o…
In the end, the feature film project that generated so much controversy fell through after one of the project developers for the Scott Valley Film Coalition became ill. According to county officials, CHF, as the grantee, has already received the money and is still allowed to spend it on other programs that fit within the forest-related education category.
Joseph Patrick Quinn, one of the citizens who wrote to his Congressional representatives about his belief the money was misspent, is skeptical of the auditor’s findings.
“To say that giving CHF money to conduct PR for industrial timber; to make films that, in effect, decry federal forest management over against private industrial management; to style this as forest related education is outrageous,” he said in an email to The News-Review.
“Personally, I never put much faith in the effectiveness of the county’s auditing of this issue and in the end, that skepticism, although I have not seen the actual audit, has apparently been confirmed,” he said.
On one thing, there appears to be an agreement between the county and its critics. Quinn is frustrated, too, about the lack of federal oversight.
“That, following receipt of the GAO Title III report, the Forest Service and the BLM were AWOL and now that they refuse to engage, or even comment, is a betrayal of the public trust, in my estimation,” Quinn said.