Timber sales from national forests in Utah cost the federal government more than $2 million last year, a U.S. Forest Service report concludes.

Annual timber sales by the Forest Service in Utah totaled $1.8 million in 1988, the report said, with other revenues bringing the statewide total to $2.7 million.But the cost of administering the program was $4.9 million, creating a net loss of nearly $2.2 million. When a mandatory payment to the state on the timber sales is added in, the total loss is more than $2.5 million.

However, to eliminate the program could have a noticeable impact on Utah's economy, the report said. Timber harvesting on Forest Service land in Utah accounted for 836 jobs, with a total community income of $15 million.

Dixie National Forest accounts for the largest number of jobs, 278, with Wasatch-Cache National Forest a close second with 272 jobs.

"The charge that Congress has given the Forest Service is to manage forest resources in a multiple use concept," said Ronald Brunson, timber staff officer of Dixie National Forest.

"If you were to do away with the program, it would have a harsh impact on the communities who rely on (the program) for their livlihood," he said.

Overall, the sale of timber by the Forest Service generates a profit for the government. In 1987, national sales totaled $1.25 billion. Expenses came to $714.5 million, with payments to state and local governments totaling $272 million, leaving a net profit of $267.4 million.

In addition to the profit, the program generates $650 million in federal income tax. The program is responsible for 139,121 jobs nationwide, with an economic impact on communities to the tune of nearly $5 million.

Rep. James V. Hansen, R-Utah, a member of the House Interior Committee, said he was cautiously supportive of the program despite its losses in Utah and other states.

Hansen said that if the program were not in place, the Forest Service would have to contract out the process of thinning forests at considerable expense and little economic benefit.

Forests are thinned under the timber sales program as a routine part of their management.

"Without the (logging off) of certain areas,," Brunson said. "They would become completely closed in with overmature growth. That cuts out a lot of areas for wildlife."

"A lot of people access forests and recreational areas on roads constructed for timber purposes, contributing to the multiple use concept. The people who would like to see the timber sales progam changed don't look beyond simple cash flow," he said.

Utah is not the only state in the region where the Forest Service is losing money. Colorado, for example, shows an overall loss of slightly more than $1 million. But the program creates 1,130 jobs and generates more than $23 million in economic impact for local communities.