The great agency shakeout.

Thousands have taken buyouts at the Forest Service and Soil Conservation Service. Here's a look at how it will affect our ability to manage public lands.

WE'VE LOST OUR master sergeants," a senior manager-type at the Forest Service observed in weighing the impact of the 1994 buyouts. When Congress offered federal employees a voluntary separation incentive, or buyout, last March, some 2,177 employees at the Forest Service and 1,034 at the Soil Conservation Service vacated their desks in a matter of days. They took with them buyout bonuses of up to $25,000 each and collectively 95,000 years of experience. An additional 1,000 buyouts were approved for the two agencies in the fall.

What led to the buyouts of '94, and what are the impacts of the largest shakeout ever at the land-management agencies?

The buyout profile was a white male in his early 50s who had risen through the ranks to a Grade 9-12 technician job--the master sergeants of land management. Those familiar with the pivotal role of a master sergeant in a military unit know how pervasive such a loss can be. Their exit may signal the end of an era.

Does this sudden, heavy loss of experience jeopardize the agencies' missions? James R. Lyons, assistant secretary of agriculture for natural resources and the environment, says no. "We targeted specific job series where we had excess capacity, like engineering and foresters. That will allow us to staff back up in other skill areas where we feel we need different people with different backgrounds to meet the challenges we face down the road."

Although legislation requires that one full-time equivalent be eliminated for each buyout, agencies can borrow from a pool of vacancies created by other federal agencies that are downsizing without buyouts. If the land-management agencies had had to take full loss for the buyouts, "That definitely would have had an impact," Lyons says.

One of the challenges Lyons expects the natural-resource agencies to face down the road is changing leadership styles. Among the senior executives taking the buyout was Jeff M. Sirmon, deputy chief for international forestry. An author on leadership in the federal government, Sirmon sees styles changing with the times. His background is a case in point:

Entering the Forest Service fresh out of college with an engineering degree, Sirmon took military leave for a tour in the Army Corps of Engineers, then returned to rise through the ranks. "We are witnessing the passing of the authoritarian style of leadership that dominated the Forest Service," he believes. That style was shaped by the training that line officers receive in fighting forest fires--a discipline similar to military combat.

The attack on the strong line-staff organization of the Forest Service began with the environmental movement heralded by the National Environmental Policy Act of 1969. NEPA has served as a catalyst in the evolution of a style called shared-power leadership. Although it sounds like an oxymoron, shared-power leadership may offer a solution to the litigious nature of natural- resource management nurtured by environmental laws. Shared-power or community-of-interest leadership may accommodate a philosophical shift toward ecosystem management and away from traditional focuses such as timber for the Forest Service.

The Gore Report

INTO THIS state of flux came the political scientists of the Clinton Administration, intent on change but frustrated by Civil Service seniority. Buyouts--a downsizing technique borrowed from private industry--promised relief. Introduced to federal government by the Bush Administration, buyouts helped the Department of Defense and the Central Intelligence Agency reduce their workforces in the early days of the post-Cold War era. Vice President Al Gore and the National Performance Review, in the September 1993 reinventing government plan, "Red Tape to Results: Creating a Government that Works Better and Costs Less," recommended buyouts for other agencies, with the Department of Agriculture identified as a prime candidate. The plan will eliminate a quarter of a million federal jobs, many of them middle-management and above, over a six-year period at a savings of $30 billion.

Demographics for the Forest Service and the Soil Conservation Service showed an uneven age distribution common across government, with older white males staying on in top positions. According to the Office of Personnel Management, 17 percent of eligible employees retired each year during the 1980s; by 1992, however, that figure had dropped below 5 percent. In 1993, with rumors of buyout in the air, retirement-age employees formed a wave of people ready to go out but playing a waiting game. At that point buyouts were needed to get the sluggish attrition rate moving again.

Buyouts offered multiple benefits. By trimming from the top, they could help agencies comply with President Clinton's executive orders calling for a more diverse federal workforce and for 10 percent of all staff reductions to come from Grade 14+ positions. Everybody wanted buyouts.

Buyouts Vs. RIFs

THE MOVE TO reduce federal staff was triggered by declining federal budgets. During the Bush Administration, the Forest Service budget had shown a steady increase overall, but the 1993 appropriation contained a $44.7 million reduction in the timber-sales program. Those funds paid salaries, and the Forest Service prepared to downsize. The first Clinton budget reduced the overall budget, slashing another $34.4 million from the timber program. Overall, the budget cuts were not severe, but the reduction in salary money was major. Not all funding supports staffing; for instance, State and Private Forestry works largely with states and partners.

In response the Forest Service declared 1,133 permanent positions excess to the needs of the agency. Secretary of Agriculture Mike Espy declared a hiring freeze, and as vacancies occurred, the Forest Service began filling them from a list of surplus employees. By November 1993, the agency was still carrying 700 surplus, unfunded employees.

Across the street from the red-brick Auditors Building that houses the Washington office of the Forest Service are the long corridors of Agriculture's South Building and the national headquarters of the Soil Conservation Service. Here SCS Chief Paul W. Johnson and his staff faced the loss of cost-share programs in a reorganization plan proposed to Congress by Secretary Espy. To prepare for a 25 percent reduction in FY 1995, SCS set in motion an agencywide effort to rank positions. Employees ranked jobs as Priority 1, need to be filled; Priority 2, may be filled; and Priority 3, eliminate. Johnson relates how employees themselves concluded that 20 percent of the jobs at national headquarters were expendable. As Priority 3 positions became vacant, they were eliminated and "removed from the books."

Despite these corrective actions, as 1993 drew to a close, both agencies were looking at layoffs--or, as the feds call them, reductions in force or RIFs. Cumbersome, difficult, demoralizing, and extremely expensive is how Forest Service Chief Jack Ward Thomas describes them. In a RIF, when a top job is eliminated, its occupant can bump an employee with less seniority, with veterans having preference. This can set in motion a domino effect that ends with the most recently hired--often the youngest and most diverse employees--being let go. The average cost of a RIF--including severance pay, bumping expenses, unemployment benefits, and personnel appeals--is $100,000 per employee.

The buyout's charm is that it works in reverse. Senior employees elect to leave, taking incentive bonuses with them, and allowing younger employees to stay on and move up. On paper, buyouts seem too good to be true. Cheaper than RIFs, they can result in actual savings, depending on when they are offered in a fiscal year.

Meanwhile, Forest Service managers in Region 5 (Pacific Southwest) and Region 6 (Pacific Northwest)--the areas hit hardest by timber-sale reductions--were ready to announce a RIF, but Jim Lyons dissuaded them, declaring that the Forest Service was not going to issue RIF notices right before the holidays. Secretary Espy went further and announced there would be no RIFs at Agriculture. Instead, Espy and Lyons, who both came to Agriculture from Capitol Hill, went to work to convince Congress of the pressing need for buyouts.

The Buyout Bill

CONGRESS passed the Federal Workforce Restructuring Act--the buyout bill--on March 30; President Clinton signed it the same day. The name of the bill clearly states that the purpose was not only to downsize but to restructure federal agencies. The act authorized federal agencies to offer "voluntary separation incentives" paid from salary funds through March 1995. Employees whose performance was essential to the mission of an agency could be kept on no later than March 31, 1997. Buyout employees who returned to federal employment within five years would have to repay the incentive, unless deemed to be the only qualified candidates.

The bill made law of the Gore Report's recommendation to downsize the federal workforce, setting the following reduction deadlines for full-time equivalents in all federal agencies: FY '94: 2.08 million; FY '95: 2.04 million; FY '96: 2.00 million; 'FY '97: 1.96 million: FY '98: 1.92 million; FY '99: 1.88 million.

The Forest Service was ready and waiting. On April 1, Chief Thomas announced Voluntary Separation Incentives (VSI)--buyouts. His first objective was to place unfunded employees. Projecting the need to place 2,000 surplus employees through 1995, he set the buyout goal at 2,000. The incentives would help reduce the number of Grade 14+ administrative jobs and jobs at regional offices and the Washington office per Executive Order. Eliminating top positions also would help adjust the agency's manager-employee ratio. The goal was to move the agency from its ratio of one manager for every six employees to a ratio of 1:10; the private sector ratio is 1:15. At the same time, buyouts would facilitate reorganization, restructuring, and reinvention.

The spring buyout window was short, April 3 to May 13, and those taking VSIs had to vacate their desks during that window. Time was of the essence, because the incentives were to be paid from uncollected salaries. The Chief reserved the right to suspend the buyout once the target was met, and he did so in late April.

Excluded from the buyout were programs and occupations with constant or increasing budgets and employees in special pay rates and shortage skills. Research, State and Private Forestry, International Forestry, and Law Enforcement employees were ineligible, but even in these programs, foresters, forest technicians, and Grade 14+ personnel could elect the buyout.

Occupations ineligible for VSIs were wildlife biologist, fishery biologist, hydrologist, botanist, soil scientist, ecologist, archaeologist, pilot, land surveyor, and land appraiser--disciplines essential in the shift from timber management to ecosystem management.

Backfilling

THE COST OF incentive bonuses, annual-leave payments, and pension contributions for the spring buyouts wiped out any projected savings, and the much-discussed question of how to spend the buyout savings was suddenly moot. In the aftermath of the great shakeout, Secretary Espy lifted the hiring freeze, and Assistant Secretary Lyons returned hiring authority to the Forest Service and Soil Conservation Service. Since buyouts placed both agencies ahead of schedule in reaching their downsizing targets, they could restaff at least some positions. The Forest Service is staffing back up, and the Soil Conservation Service is looking at innovative ways to put new people to work in its hard-hit field offices.

SCS, all of whose 14,000 employees were offered the buyout, was authorized to backfill 460 field positions. To restaff in the midst of steep budget cuts, Chief Johnson is considering part-timers.

"In almost every district in the country, we've got good conservation farmers and ranchers who probably wouldn't mind putting in a few hours a week with us," he says. "They probably would train some of our young people." His agency may use Americorps volunteers from the new national service corps--college graduates coming on to work for a year. Johnson would place them in riparian restoration in the Midwest flood-recovery area, the Emergency Wetlands Reserve Program, or Northwest salmon-recovery work.

Foresters and Engineers: Endangered Species?

WHEN ASKED IF the Forest Service would be hiring fewer foresters, Jim Lyons replied: "That all depends on how you define foresters. I define foresters as people with a natural-resources background. The Society of American Foresters includes silviculturists, wildlife biologists, hydrologists, recreation specialists--that's the forestry community and will continue to be the strength of the Forest Service."

But compared with the past, the agency will be hiring fewer degreed foresters. The Forest Service focused the buy-out on Regions 1, 5, and 6, those with the largest timber-sale programs.

"As we were reducing our timber program by three-quarters in the Pacific Northwest, we obviously would not need as many road engineers and timber-sale foresters," Chief Thomas comments. "On the other hand, in the Pacific Northwest we were very concerned with the salmon. We obviously wouldn't want to lose any fisheries biologists." To show that he doesn't play favorites, Thomas points out that even though he has worked as a wildlife biologist, his Ph.D is in forestry.

On the subject of engineers, SCS Chief Johnson, himself a forest ecologist, believes, "We still have to have the best people in the world in the engineering area, but I think they've got to step out of their boxes, and they've got to combine with the ecological sciences in what we call bioengineering today."

The future, as he sees it, will be "more and more trying to work with the natural systems rather than changing them." The President's Interagency Flood-plain Management Review Committee took a similar position in a June 1994 report. Both agricultural and civil engineers signed up for the buyout, and Jonson sees the need in his agency for "some fantastic engineers" to design wetlands and restore streams.

Diversity

THE DOWNSIZING had an immediate impact on diversity, leaving the workforce, as Lyons put it, "more diverse culturally and in terms of gender, race, and ethnicity, as well as the different disciplines. The buyout helped us do that job."

It was especially opportune in Region 5, where the Forest Service had hired a diverse workforce to comply with a 1981 consent decree in a class-action suit alleging discrimination against women in hiring and promotion. The Forest Service and plaintiffs signed a settlement agreement in 1992 in which the agency agreed to a number of stipulations to protect the civil rights of women employees.

Had the Forest Service been forced into a RIF, those newer, more diverse employees could been laid off, putting the agency in contempt of court. "Buyouts happened to come along at a very opportune and appropriate time for us, because we were getting to the point where we were going to have to have a reduction in force," points out Lamar Beasley, deputy chief for administration. "We did not have the money to carry the existing workforce into the future."

Beasley himself experienced the impact firsthand: All but one of his Personnel staff took the offer.

Over at the Soil Conservation Service, Johnson hopes that his agency will be more sensitive to diversity issues as people are brought back in. Deputy Chief Lewis concludes that the buyout provided an opportunity "to change the mix of people the mix of people that we have in the agency."

Impacts

PRIVATE industry has experienced some unpleasant surprises with its buyouts. Often the employees who leave are the most resourceful, and the evidence does not support the idea that downsizing increases productivity.

The loss of key people at the forest-district level makes it difficult for the Forest Service to serve its various publics, and environmental initiatives like AMERICAN FORESTS' Global ReLeaf campaign are feeling the pinch. The Global ReLeaf Forests program targets ecosystems damaged by storms, disease, or overuse and provides funding for tree planting. Since 1990 the popular program has planted 2.5 million trees, most of them on public lands. But since the buyouts, Bill Tikkala, special-projects forester with AMERICAN FORESTS, reports several instances in which the Forest Service, because of reduced staff, was not able to schedule Global ReLeaf plantings. On one forest district in Texas, six of 19 staff members left, including the forest ranger and two key technicians. Other personnel have been reassigned to positions with expanded territories and duties. Tikkala concludes that the agency is spreading itself thin and that the workload is suffering.

The agencies admit short-term impacts but believe the opportunities created for young people outweigh any short-term dip in productivity. Though they were reluctant to discuss the impact on their capability to manage public lands, Chief Thomas did acknowledge, "The bad news is that you lose experienced managers. The good news is that you have experienced people ready to move into those positions, and it gives younger people a chance. And that's not always a bad thing."

For some professionals, the buyout was a wrenching experience and a less-than-dignified close to a lifetime career. The design allowed no time for orderly exits, trying up loose ends, passing along complex projects, or training successors. One senior manager returned as a volunteer to ensure that his files and special projects were reassigned.

The buyouts could make room for an increase in government contractors, despite contract-limitation language included in the buyout bill. Forest Service contracts cover everything from reforestation and timber-stand improvement (TSI) to information systems. The FY 1992 appropriations act authorized the Forest Service to experiment with stewardship land contracts on four test forests, and the agency is preparing a report on the findings. Timber sales will continue, and some senior managers predict increased opportunities for contract work at the timber-sale level.

SCS Chief Johnson comments that although "It's easy to get depressed about the buyout," he believes it has allowed SCS to eliminate an unnecessary layer of bureaucracy.

Restructuring, Reorganizing, Reinventing

WAS THE buyout a reinvention purge? Assistant Secretary Lyons insists no "grand scheme" or "ulterior motive" was behind the buyouts. All the commentary about attacks on the workforce and capability and institutional memory, he says, misses the point. "Buyouts may make it easier to do some restructuring, but that's ultimately only part of the effort. Buyouts were not intended to make that happen,but as I have come to discover in this job, people have come to these gross misinterpretations of what occurred."

Chief Thomas admits, though, that the Forest Service tried to dovetail the buyout operation into the reinvention effort, which calls for a leaner, meaner organization.

The Soil Conservation Service faces major reinvention. Under the reorganization plan submitted to Congress, SCS would become the Natural Resources Conservation Service, an agency dedicated to working with private landowners on all resources--soil, water, forests, fish, and wildlife. "State and Private Forestry is still under the Forest Service," Johnson notes, "but we are working very closely with them." He doesn't see his agency as one "that's going to duplicate things that are being done elsewhere," but recognizes the need to "partner better."

Assistant Secretary Lyons comments, "The leadership changes are going to be substantial, and I think that's what's fascinating. We are going to turn over more than two-thirds of the Forest Service leadership in the next few years. We already have had substantial changes in forest supervisors. We have already replaced five of our nine regional foresters, and we've had substantial turnover in the Washington office."

Jim Lyons represents the new guard, with eyes focused on the horizon. Lamar Beasley takes a moment for a backward glance. "We had a lot of experience going out the door at one tie; we had a lot of institutional memory walk out. A lot of the people who left are the people who have led this outfit to where we are today.They are valued, and they ought to be remembered for the contributions they made."

Editor's Note:

At press time, Secretary of Agriculture Mike Espy announced his resignation, effective at year's end, to combat questions of improprieties. It is uncertain at this time what impact the resignation may have on current efforts to reorganize the department and reduce its size.

FIREFIGHTERS AND THE BUYOUT

WHEN THE FOREST SERVICE excluded shortage skills from the buyout, its fire program was not listed among them. In fact, contingency funds were available for its downsizing. All firefighting and co-op fire positions were included, except pilots and fire forestry technicians in Southern California. Among those taking the buyout nationwide, 175 were fire managers of unit-leader level or above. The majority were men in their late 40s and early 50s, who vacated GS 12-15 positions, most of which will be filled next year with younger men and women.

Following the buyout, the Forest Service experienced a short-term loss of skills, more in management and coordination than on the fireline. Jack Ward Thomas, chief of the Forest Service, acknowledges that all units were affected but adds, "There aren't any fire bosses out there running things who are not fully qualified."

The buyout occurred in April, prior to the onset of a fire season with a record number of firefighter fatalities. An investigation of the South Canyon fire that took 14 lives in Colorado found that "mistakes were made" in the absence of an orderly chain of command. Some testimony linked the incident to budget reductions and the loss of full-time equivalents. In August, five months after the buyouts trimmed federal agencies of their "master sergeants," the Marines, Army, and National Guard were called in to relieve exhausted firefighters. That same month, the Office of Personnel Management authorized a waiver of the rehiring ban, so that experienced fire managers who had left could be brought back on as emergency employees.

BUYOUTS AT BLM

THE FOREST SERVICE and Soil Conservation Service were not the only federal land-management agencies affected by the buyouts. The U.S. Department of Interior had a total of 3,085 employees take the spring buyout:

DOI AGENCIES SPRING 1994 BUYOUT

BUREAU OF RECLAMATION               805
U.S. GEOLOGICAL SURVEY              582
NATIONAL PARK SERVICE               422
BUREAU OF INDIAN AFFAIRS            338
BUREAU OF LAND MANAGEMENT           298
FISH & WILDLIFE SERVICE             225
BUREAU OF MINES                     177
MINERALS MANAGEMENT SERVICE          55

DOI also was authorized for a second round of buyouts. At the Bureau of Land Management (BLM), where 10,000 employees manage 270 million acres of public lands, more people applied for the buyout than could be spared. Even by limiting the number of buyouts, the agency is feeling the loss of 8,000 years of experience and institutional memory. In the Pacific Northwest, where a third of the buyouts occurred, BLM had maintained a large timber-sale-management staff that was the center of the Bureau's forestry program. Since the President's proposed forest plan sharply reduces the timber harvested from federal forestlands in the Pacific Northwest, BLM could let 99 employees in the area retire with incentives. The agency targeted 10 occupations, among them road engineers, timber-sale foresters, fire staff, and all supervisory positions.

Natural-resource management is changing at Interior, with a bureau-wide reorganization and retraining of personnel to manage whole ecosystems. At BLM, the buyouts worked hand in hand with the reinvention effort. The long-term impact may well be more generalists and fewer specialists. It wasn't a matter of jeopardizing the agency's mission; that mission is changing.

BARRY WALSH--of Garrett Park, Maryand, is a Washington-watcher who specializes in natural-resources and environmental subjects.