A legislative audit released Monday says Utah's 12 state-owned fish hatcheries are producing too many eggs and fish at too high a cost, and raises the possibility of closing one or two of the Division of Wildlife Resources' facilities.

Auditors also found that Utah's conservation permit sales help improve hunting opportunities while diminishing public hunting opportunities by less than 1 percent. They recommended that the DWR review Cooperative Wildlife Management Unit (CWMU) permits to ensure that the public receives an equitable share of the tags.

Much of the audit focused on inefficiencies in the DWR's fish hatchery program. The agency's 12 hatcheries produce approximately 1 million fish each year, most of which are stocked throughout the state to provide fishing opportunities.

The agency's aquatics section needed a $2.2 million cash infusion in 2010, with much of the revenue taken from sales of hunting licenses.

"We treat all of our money from hunters and anglers as one big fund," said DWR director Jim Karpowitz. "Right now, we've got more wildlife money coming in than fishing [money], but that goes back and forth. We don't want that to be the case long term."

He said Utah anglers can likely expect to see a fishing license fee increase in 2013. Such a change must be approved by the Legislature.

The audit said Utah's fish hatcheries are producing more pounds of fish at a higher total cost, often caused by hatcheries raising larger sized fish as well as increases in energy and feed costs. In 2010, DWR hatcheries produced 1,334,889 pounds of fish and stocked 8.7 million fish at a cost per pound of $3.73. In 2006, the cost was $3.02 per pound. In that year, hatcheries produced fewer pounds of fish, but stocked a higher number of fish.

Karpowitz said that increased hatchery production has added 100,000 fishing licenses purchased in Utah in the past six years, generating about $2.8 million in additional revenue. He said that justified some of the increased production at Utah hatcheries.

Part of the cost increase is that "community fisheries" near urban and populated areas require planting of more-expensive-to-produce hatchery fish, usually rainbow trout. These fisheries have proved popular, but can be expensive to manage.

Auditors said that the DWR might save money by closing less efficient hatcheries. The two least cost-effective facilities in the state system are at Mammoth Creek south of Panguitch and Mantua.

A major concern was that Utah hatcheries maintain "brood stock" to produce eggs and have been producing by as much as 50 percent more than needed by hatcheries. Some of those eggs are given to surrounding states, or traded for other wildlife species. Auditors said that the DWR has given away about $700,000 in eggs to out of state hatcheries and have discarded almost $600,000 in viable eggs over the past three years because of overproduction.

They suggested that the agency's brood stock program might be eliminated and eggs be purchased from other states.

"We intentionally overproduce eggs," said Karpowitz. "You can have pretty big failures, and you don't want to get caught short. But we have been overproducing more than we need to. We have cut that back to about 20 percent overproduction."

Auditors also told the DWR to evaluate whether every species of fish the state produces is necessary to meet management goals.

Utah hatcheries produced more than 135,000 pounds of excess fish for 2009 and 2010 at a cost of over $530,000, exceeding quotas of fish requested by regional biologists.

On the big game portion of the audit, auditors found the DWR's conservation permit program — in which groups such as Sportsmen for Fish and Wildlife auction permits to hunt trophy animals — benefited the public by promoting habitat preservation and species conservation.

Karpowitz called the audit fair and helpful.

"We felt they did a thorough audit of the hatchery program, and we welcomed it at the time because we were doing the same thing ourselves," he said. "We felt they could do a good, unbiased evaluation and we are going to implement their recommendations."

George Sommer of the Blue Ribbon Fisheries Advisory Council wondered why the audit of the DWR mainly focussed on hatcheries, even though last year's similar audit of the Utah State Parks proved much more detailed.

"The thing that jumped out at me was the audit solely focussed on one area, which was hatcheries," he said. "Everything else seemed to be fluff. I thought it was interesting they found no issues with the conservation permit or CWMU program."

wharton@sltrib.com

Twitter: @tribtomwharton