However, one drawback of this calculation method is that it assigns a lower score for land-use changes occurring in degraded land, therefore the equivalence ratio and, by extension the fees, would be relatively low while the costs to restore an equivalent land could be high. Given that the in-lieu fees are based on reference average costs for restoration and reforestation activities, and on an equivalence ratio, the area of land-use change does not equal the area of land restored and/or reforested. The in-lieu fees collected in the Forest Fund for compensation of land-use change in forested areas in a given year in each federal state represents the budget available to CONAFOR to conduct the compensation and restoration activities in the federal state where the fees were collected. The funds must therefore be used for compensation activities located in areas near where the land-use change takes place.