Beached logs pile up in Shoal Cove on Revilla Island in the Tongass National Forest. (Jim Baichtal/USFS)

A federal watchdog agency says the U.S. Forest Service acted illegally when it awarded a $2 million grant to the state of Alaska in 2018. The state had asked for the grant to gather input on a proposal to exempt the Tongass National Forest from the Clinton-era Roadless Rule.


The U.S. Department of Agriculture’s Office of Inspector General issued its report Wednesday. The report says the Forest Service illegally awarded the $2 million to the state through a grant program intended to support fire suppression in state-owned forests.

A Washington, D.C.-based spokesperson for the Forest Service, Larry Moore, says the money had been set aside for the state. But he says none of it actually ever changed hands. The agency says it’s working with its in-house lawyers to determine how to reallocate the funds.

That means the state is on the hook for any expenses the grant was meant to reimburse. The $2 million grant was to be matched by state funds. It’s not clear how much the state spent gathering input from industry groups and local stakeholders.

The USDA watchdog does not directly accuse state officials of wrongdoing — in fact, documents obtained by Alaska’s Energy Desk show that the state told the Forest Service exactly what it was requesting the money for. But investigators say that money never should have been awarded as part of the firefighting grant.

The Alaska Department of Natural Resources says it’s reviewing the findings. Spokesperson Dan Saddler says the agency will work with the Forest Service to ensure grant funds are spent in line with their intended use. He says in an email that the state Division of Forestry voluntarily cooperated with the investigation.

Investigators say it’s above-board for the Forest Service to provide funding to gather input on rule changes. But they say awarding that money to the state without informing other interested parties that money was available for that purpose violated federal law and regulations.

Southeast Alaska Conservation Council Executive Director Meredith Trainor said it’s an example of conservation groups and tribes being shut out of the rulemaking process.

“The findings of this independent investigation highlight one of many critical flaws in the Alaska-specific Roadless Rule-making process, and the undue influence that the Trump administration wielded in determining which groups would have access to participate in the public process, and which would be left out,” she said in a statement posted to the group’s website.

She added that the group looked forward to working with the incoming Biden administration to overturn the rule.

Alaska Wilderness League head Adam Kolton issued a statement saying the investigation shows that approval of a roadless rule exemption was “baked into the process once Governor Dunleavy sold Donald Trump on the idea on Air Force One.”

“Alaska officials wanted to change the rule, so the Forest Service gave the state $2 million dollars to convince them to do so,” Kolton wrote.

He said the investigation shows “an egregious lack of respect for Alaska Native voices in Southeast Alaska,” adding that the investigation showed the rulemaking process was driven by timber industry interests.

The investigation was prompted by a story last year from former Alaska’s Energy Desk reporter Elizabeth Jenkins. She uncovered documents showing the state had paid the Alaska Forest Association more than $200,000 to influence the rulemaking process. The industry group declined to comment for this story. At least one Southeast Alaska tribe was also reimbursed for travel expenses estimated at a few thousand dollars.

Two members of Congress requested the investigation after the story was published.

State officials, including Gov. Mike Dunleavy and Natural Resources commissioner Corri Feige, said last year the state had not misspent any federal money from the grant.

This story has been updated with additional information.