BLM LIBRARY 88067932 U.S. Department of the Interior • Bureau of Land Management Annual Report on Performance and Accountability 2006 Year Fiscal PREFACE The Bureau of Land Management (BLM, or Bureau) is a small agency with a big mission We and a lot of ground to cover. administer more Federal lands than any other agency: over 258 million acres of public lands and their myriad resources, plus hundreds of millions of acres of subsurface mineral estate. Our workforce is spread across the country in numerous state offices and field offices. Most ofthe public lands and resources we manage are in the western states and Alaska. Our Eastern States office in Virginia manages land and natural resources in 31 states east ofand We bordering the Mississippi River. also have national centers for business, science and technology, human resource management, and information resource management in Denver; fire management in Boise; and training in Phoenix. Our headquarters is located in Washington, D.C. In managing the Nation’s vast public land holdings for multiple uses, we perform many tasks: resource inventory, land use planning, environmental impact assessment, land surveying, road construction, fish and wildlife habitat restoration, and resource condition monitoring, to name just a few. Public lands administered by the Bureau include millions ofacres ofopen rangelands; geological formations containing the oil, gas, coal, and other minerals needed to sustain our economic well-being; recreation areas and remote landscapes with spectacular scenery and opportunities for solitude; fishable streams; high forested slopes; alpine tundra; majestic canyons; and rugged badlands. We invite you to read our 2006 Annual Report and see what we have accomplished. Take a moment to reflect on the wealth ofresources and opportunities offered byAmerica’s public lands and this year, . . . think about planning a visit toyour public lands! BLM 2006Annual Report itxzm^yx- T^(GCXci53‘3w Director’s Letter 1 TABLE OF CONTENTS Message from the ChiefFinancial Officer 3 Cooperative Conservation 3 Management’s Discussion and Analysis 6 The BLM’s Mission and Organizational Structure. 6 Performance Goals and Results 9 Systems, Controls, and Legal Compliance 27 — Management Challenges Looking Ahead 32 Discussion and Analysis ofthe Financial Statements 36 Financial Statements 39 Principal Financial Statements 40 Notes to Principal Financial Statements 46 Supplementary Statement of Budgetary Resources by Major Budget Accounts 84 Stewardship Lands and Heritage Assets Report 88 Stewardship Lands 88 Natural Fieritage Assets .92 Cultural Heritage Assets 96 Museum Collections 96 Condition ofStewardship Lands and HeritageAssets .98 . Deferred Maintenance Report 101 Investment in Research and Development Report 103 Independent Auditors’ Report 109 BLM Library Denver Federal Center Bldg. 50, OC-521 P.O. Box 25047 CO Denver, 80225 -uw BLM 2006Annual Report i OUR VISION To enhance the quality oflife for all citizens through the balanced stewardship ofAmerica’s public lands and resources. OUR MISSION To sustain the health, diversity, and productivity ofthe public lands for the use and enjoyment ofpresent and future generations. OUR VALUES To serve with honesty, integrity, accountability, respect, courage, and commitment to make a difference. OUR PRIORITIES To improve the health and productivity ofthe land to support the BLM multiple-use mission. To cultivate community-based conservation, citizen-centered stewardship, and partnership through consultation, cooperation, and communication. To respect, value, and support our employees, giving them resources and opportunities to succeed. To pursue excellence in business practices, improve accountability to our stakeholders, and deliver better service to our customers. BLM 2006Annual Report “To sustain the healthy diversity and DIRECTOR'S productivity ofthepublic lands. LETTER For the use and enjoyment ofpresent ” andfuture generations. The mission ofthe Bureau ofLand Management (BLM) is grounded in a principle that dares back to the very birth of the conservation movement and to the inspiration ofits founding father, President Theodore Roosevelt. “Conservation,” Roosevelt said, “means development as much as it does protection. I recognize the right and duty ofthis generation to develop and use the natural resources ofour land; but I do not recognize the right to waste them, or to rob, by wasteful use, the generations that come after us.” Roosevelts wisdom ofa century ago is surely as relevant for us today, as we strive to provide good stewardship ofthe natural resources ofour land, for the benefit ofpresent and future generations. The dramatic transformation ofthe American West since Roosevelt’s time has brought urban centers, with tens ofmillions ofcitizens, in closer contact with their public lands. For many western communities, the vast and magnificent open spaces managed by our agency have become “America’s great backyard”—with boundless opportunities for recreation and adventure. At the same time, the public lands have grown increasingly important to the nation for the energy and mineral wealth that sustain our economy and energy security and our quality oflife, and for other economic activities such as timber production and ranching that are important to the nation and to the vitality oflocal communities. In this context, balanced stewardship ofthe public lands and resources is more important to the interests ofthe nation and its citizens than ever before. This mission is also more complex and challenging than at any time in our history. The following pages detail our progress over the past year in advancing Kathleen Clarke this important mission. Director, Recognizing the growing public interest in public land recreation, Bureau ofLand we are working to ensure quality recreational experiences for the tens of Management millions ofcitizens who visit the public lands each year. Through a broad national partnership, we are developing strategies such as comprehensive travel management that will help us meet future demands for recreation, while protecting the cultural, natural, and scenic resources ofthe land. In 2006 we completed another milestone in this effort that will improve management ofsome of our most popular recreation venues: a 10-year plan for management ofNational Scenic and Historic Trails. We have successfully completed a four-year effort to institute fundamental changes in the management ofpublic rangelands. These changes will give us greater flexibility to work in partnership with the ranching community in conservation measures to improve forage, improve the health ofwatersheds and habitat for fish and wildlife, and ultimately help preserve the great open spaces ofthe West. BLM 2006 Annual Report 1 We have honored the 00th anniversary ofthe Antiquities Act with 1 a renewed dedication to the preservation ofthe priceless heritage and cultural treasures that are part ofAmerica’s public land legacy. We have continued to implement the National Fire Plan to improve the management ofwildifires that can threaten environmental resources and communities, particularly along the growing wildland urban interface. Through the Flealthy Forest Restoration Act, we are expanding partnership efforts at the local level to promote healthy forests and healthy forest communities. We have assumed a leadership role in implementing the bipartisan National Energy Policy adopted by Congress and signed by the President last year. The BLM’s efforts will make a significant — contribution to the central goals ofthat legislation promoting responsible development ofdomestic energy from both traditional and alternative sources and improving protection ofthe environment. Our guiding principle in all ofthese endeavors is balanced management that recognizes, as Teddy Roosevelt said, the dual obligations ofour stewardship: to both use the land and its resources and to conserve these resources for the benefit offuture generations. We accomplish this through the principle ofCooperative — Conservation an approach that harnesses the pride and volunteer spirit ofindividual citizens and communities, the leadership and vision ofprivate organizations, the entrepreneurial creativity and civic dedication of business, and the common purpose ofagencies of government at the federal, tribal, state, and local level. To all our partners in Cooperative Conservation who have contributed to the progress ofthe past year, and who will help us advance our mission into the future, we extend our deepest appreciation. 2 BLM 2006Annual Report This FY 2006 Performance and Accountability Report summarizes our MESSAGE FROM efforts in the Bureau of Land Management (BLM) to successfully carry out THE CHIEF our mission to “sustain the health, diversity, and productivity ofthe public lands .... Through this report, we share with you our efforts to improve FINANCIAL our accountability and performance consistent with the Department of OFFICER the Interior's Performance Plan, provide a discussion of our programs and accomplishments, and present our audited financial statements. The BLM is keenly aware of the important role that sound business and financial management practices play in executing its natural resource mission. We are proud ofour past record, and we continue to strive for excellence. The following table shows highlights ofsome ofour 2006 achievements: LI Financial statementaudit The BLM has received unqualifiedauditopinionson itsfinancial opinion statementsfor 12 consecutiveyears,thusdemonstratingour accountabilityforthepublic resourcesentrustedtous. Reportingdeadlines Financial statementreportingdeadlinesareconsistently met. Financialsystemscompliance Financial systemscomplywithcorefinancialsystems requirements. Anti-DeficiencyActviolations Theagency has noanti-deficiencyviolations. Material internal control Auditorshavereported nomaterial internalcontrol weaknesses. weaknesses The BLM successfully implementedAppendixAofOfficeof Managementand Budget (0MB)CircularA-123 in 2006in accordancewith Departmentalguidelinesandprovidedan unqualifiedassurancestatementtotheDepartmentrelatingto financial reporting. Non-compliancewith law/ All noncompliance(FFMIA)issuesfor2005andpriorhavebeen regulation cleared. Materialweaknesses/non- Auditorshavefound no FMFIASections2 or4material conformanceunderSections2 and weaknessesornonconformancesthatimpactinternalcontrols 4ofFMFIA overfinancial reportingorfinancial systems,with theexception of RequiredSupplementaryStewardship Informationfor"Condition ofMuseum Collections." Accurate/timelyfinancial The BLM implemented its Management Information System information (MIS) in 1999. The MIS isa datawarehousecontaining multiple interactive modules, includingboth summaryandtransactional levelfinancial information;billingandcollections;laborcost;cost Michael A. Fergusen management(activitybasedcosting/management);workload measures(outputs);performance measures(outcomes);budget ChiefFinancial Officer planning/formulation;customersurveyresults;property,space, andvehicledata;andotherinformation. Thedatacontainedin theMIS isupdated nightly andisavailabletoall BLMemployees ontheBureau's Intra—net. Thefinancialanddetailedlaborcost dataspanstenyears sixyearsforcostmanagement. Integral componentsofthe MISarefinancial datafrom ourCost ManagementSystem thatenablesustotrackactualcostsbywork activityanda Performance ManagementSystem thatfacilitates thecollectionand reportingofperformanceinformation. Together,theseprovideaccurateandtimelyinformationfor assessingperformanceandfor reallocating resourcestoachieve Bureau prioritiesandstrategicperformancegoals. Thesesystemsprovideadisciplinedapproach toresource managementforimprovingperformance,servicequality,and customersatisfaction. Through it,wedefinewhatisimportant, establish thelevelofworkandoutputstobeaccomplished, anddeterminethebudgetresourcesnecessarytoaccomplish thespecificactivities(outputs)thatwhenaggregated, measure performanceintermsofstrategicoutcomes/results. BLM 2006Annual Report 3 Plan toexpand scopeofroutine The BLM haspresentedtoOMB itsplantocontinuouslyexpand data usedtoinform decisions thescopeofroutinedatathatisusedtoassistBLM decision- makers. The BLM continuestoimplementitsplanand has completedthreeofthefourinitiativespresented intheplan. The BLM alsocontinuestoseekoutotherwaysto improveitsfinancial information. The BLM continues to strive for excellence in other management areas as well. In fiscal year 2006, the BLM met or exceeded most ofthe nearly 100 performance measures for which it reports performance data. The Bureau also made considerable progress in implementing all aspects ofthe President’s Management Agenda (PMA). In fiscal year 2006, we implemented our asset management plan and continued to expand E-Government initiatives. To improve service and accessibility to our customers, we now make available to the public our most-used forms on the Internet through an E-Forms initiative, as well as allowing the public to review and comment on environmental impact statements and other land use planning documents via the Internet. In addition, we have earned a “green” score card rating (all commitments met) in human resource management and made giant strides in competitive sourcing and budget and performance integration. We are now seeing meaningful results emanating from the use ofthe management “toolkit” that we began to implement at the turn ofthe decade. Although we are proud ofthe progress we have made so far, we recognize that more is still needed to reach the pinnacle ofmanagement excellence and then to remain in that position. We hope you enjoy reading about our programs and accomplishments and encourage you to join with us in our efforts to “enhance the quality oflife for all citizens through the balanced stewardship ofAmerica’s public lands and resources.” 4 BLM 2006Annual Report The Bureau of Land Management (BLM) works with numerous COOPERATIVE — partners states, counties, local communiti—es, other agencies, CONSERVATION organizations, businesses, and individuals to meet its stewardship responsibilities for our Nations vast public land holdings. This partnership approach promotes citizen involvement and stewardship, known as Cooperative Conservation. Aldo Leopold, noted 20th century conservationist, envisioned a Nation ofcitizen stewards. Simply put, each ofus needs to care for local landscapes and environments. Our individual actions in our own backyards, at our places ofwork, on our farms and ranches, and in our communities can make a crucial difference. Cooperative Conservation seeks to recognize and take full advantage ofthe knowledge, wisdom, talents, and enthusiasm that local people, communities, and governments bring to the table. Cooperative Conservation is far more than just a clever catch phrase or slogan. The Department ofthe Interior has already made over $500 million available in conservation grants for a variety of Cooperative Conservation programs. Two ofthese, the Private Stewardship Grant and Landowner Incentive programs, provide assistance to private landowners in their voluntary efforts to protect threatened, imperiled, and endangered species. BLM Almost $13 million was given to the in Cooperative Conservation challenge cost-share grants to fund 573 projects. These range from eradicating invasive species to restoring wildlife habitat, providing stable water supplies for elk, and providing new and improved recreation and educational opportunities. The grants cover 40 states, involve 749 partners, and leverage $26 million in partnered dollars. — Everyone benefits from Cooperative Conservation especially our environment. The voices oflocal people and communities are heard and their actions count. The BLM’s efforts and expenditures are multiplied though partnerships and cost sharing. Everyone benefits as we work together to sustain the health, diversity, and productivity ofthe public lands for the use and enjoyment ofboth present and future generations. BLM 2006Annual Report 5 MANAGEMENT'S The BLM'S Mission DISCUSSION and Organizational Structure AND ANALYSIS The BLM's Mission and History The Bureau ofLand Management’s (BLM) vision is to enhance the quality oflife for all citizens through the balanced stewardship of the resources on America’s public lands. Its mission is to sustain the health, diversity, and productivity ofthe Nation’s public lands for the use and enjoyment ofpresent and future generations. The BLM manages over 258 million acres ofsurface estate on public land, about one-eighth ofthe land in the United States. The BLM also administers hundreds ofmillions ofacres ofon- shore Federal mineral estate on or underlying both Federal surface ownerships and some privately owned surface. In addition, the BLM has trust responsibilities on 56 million acres ofIndian trust lands for approval and supervision ofmineral operations and cadastral (land) survey. The BLM administers some ofthe most ecologically and culturally diverse, and scientifically important, lands belonging to the Federal government. Among its varied responsibilities for managing and protecting our Nation’s priceless natural and cultural legacy is stewardship for: • Commercial activities • Conventional energy sources (oil, natural gas, coal, etc.) • Renewable energy (wind, solar, geothermal, biomass, etc.) • Minerals (gold, zinc, uranium, copper, mineral materials, gypsum, etc.) • Public land survey system plats and field notes • Rights-of-way • Transportation systems (roads, trails and bridges) • Fish and wildlife habitat • Range management and grazing • Wild free-roaming horses and burros 6 BLM 2006Annual Report