Logging and Sawmilling Information for the Western United States

January  2001 - Volume 26 Number 1



In The News  

Samoa Pulp Mill Sale 
In December, LouisianaPacific Corporation (LP) sold to LaPointe Partners, Inc. their Samoa, Calif. pulp mill and chip export facility. LaPointe Partners, a management and consulting firm focused on the pulp and paper industry, acquired the facility for $46 million in cash and issue preferred stock to LP totaling approximately $33 million. LaPointe chairman Bill New says, "We are very excited about the opportunities that the Samoa mill brings to us and look forward to working with the management team at the mill to plot a successful course for the future." 

Cash For Juneau Schools and Roads 
The funds that Juneau, Alaska's city government receives from a federal timber program will quadruple in 2001 - $200,000 to $900,000. A change in the current formula will give a boost to Juneau's schools and roads that have been hurt by the drop in timber harvests on federal lands. The state of Alaska should gain a total of approximately $10 million for fiscal 2001. "The precipitous drop in financial support for education and infrastructure has really hurt many Alaska towns and boroughs," says U.S. Sen. Frank Murkowski, who cosponsored the bill. "This bill reverses those reductions and sets up a steady reliable flow of federal aid to offset the loss to the local tax base because of federal land ownership." 

Community Forestry 
In Priest River, Idaho, something unique is taking place. A mixed group of businessmen, loggers and environmentalists, led by the Selkirk Conservation Alliance, are pushing for community forestry. They would like to see selected logging, with the proceeds financing forest restoration to reduce fire threat. The timber town sees this action as a way to rekindle the depressed market made worse by constricted federal sales and environmental court suits. The residents of Priest River hope to attract some of the $1.8 billion set aside for reducing the danger of wildfire nationwide. "People need to buy into their community," says hardware store owner Mike Schaff. "Everything changes. You're not going to stop that." There are skeptics, of course. Some environmentalists believe federal stewardship contracts will be used to justify logging. And many loggers don't believe anything backed by environmentalists. Mike Reynolds, owner of a local logging company, understands the tension on both sides. "We can't take advantage of this program. The last thing you'd want to do is give (environmentalists) an excuse to say we told you so: You raped the land." "If the transition can be made successfully, the opportunity is there for having healthy local economies for towns like Priest River, Bonners Ferry, and Metaline Falls," says Guy Bailey, director of the Selkirk Conservation Alliance. 

Croman Files Suit 
Croman Corporation, a helicopter logging company based in White City, Ore., filed a breach of contract suit in Washington D.C. The company is seeking more than a million dollars in damages from the Forest Service regarding the Trail Creek timber sale contract on the Boise National Forest. Croman alleges that after obtaining the contract, various preservation oriented Forest Service employees tampered with the paint markings which signified which of the valuable Ponderosa Pine trees Croman had a contractual right to cut. The deliberate removal of the markings, purportedly done to preserve the visual aesthetics of the area, cost taxpayers hundreds of thousands of dollars in contract revenue. Croman co owner Dwain Cross says, "The actions of these people was criminal. If a logger had tampered with the tree marking like the Forest Service did, he'd be in jail. These people have stolen the amount we would have paid for trees from the American people but I don't see the current Forest Service administration doing a thing to have them prosecuted." It will be up to courts to see if his accusations are true. 

Referenda in Oregon 
Oregon residents passed Measure 7, "Landowner Compensation," which amends the Oregon State constitution to require state and local governments to reimburse property owners for the loss of value caused by state and local regulations. Opponents argue the Measure would damage the state's land use system that "manages growth and conserves farmland," and the state estimates that providing compensation will require $5.4 billion annually. Governor Kitzhaber, who is against the measure, says "We're going to have to choose between enforcing our laws and money we don't have." Measure 7 went into effect Dec. 7; many are waiting to see what changes the Measure will undergo and just how effective it will be. 

Sierra Nevada Logging Suspended 
Worried about a logging injunction like one that rocked the Pacific Northwest in 1991, the U.S. Forest Service temporarily halted timber sales and most harvesting in national forests of the Sierra Nevada and nearby ranges. The nearly three-month suspension, - that began Dec. 11 - affects timber operations across 11 million acres of California and Nevada forest, and comes after environmentalists filed a lawsuit in Sacramento federal court two months ago. The lawsuit, filed by the Earth Island Institute and two other groups, seeks to suspend logging in the Sierra Nevadas and parts of the southern Cascade Range, on behalf of the California spotted owl and Pacific fisher. Both animals are being studied for endangered species status. Federal officials - fearful a judge might rule against them and grant an indefinite logging injunction - said they decided to suspend timber sales while they prepare a response to the environmental groups' lawsuit. "We strongly disagree with them on the merits of the lawsuit," said Edmund Brennan, an assistant U.S. attorney. "But we felt it doesn't make sense to rush into court and shoot from the hip on all these complex issues." Brennan added that the logging suspension probably would not have economic impact this time of year, with snows and wet roads slowing logging activities. Timber industry officials, however, disagreed, stating that many sawmills and logging companies depend on lower elevation timber, and charged that the Forest Service was "caving in to legal arm twisting by environmentalists." "These ill-conceived lawsuits are all about eliminating logging instead of protecting species," said Chris Nance, a spokesman for the California Forestry Association. "The Forest Service folks have been brought to their knees by appointees in Washington, D.C., and environmental groups." 

Dreary Production For 2001 
The Western Wood Products Association (WWPA) predicts a slowdown in new home construction, which would curtail U.S. lumber demands for the second consecutive year. The WWPA believes U.S. lumber demand will total 53.4 billion board feet in 2001, down 1.2 percent from 2000 volumes and 1.7 percent from 1999's record market of 54.3 billion board feet. However despite the decline, 2001 would be the third highest lumber consumption year on record. "Since housing is the largest market for lumber, any reduction in building activity will impact wood demand," said WWPA President Michael O'Halloran. "Though demand will be lower, we expect Western mills to see only a modest decline in production." 

Plum Creek to Protect Fish 
Officials from Plum Creek Timber and Interior Secretary Bruce Babbitt recently signed an agreement designed to protect fish habitat in exchange for regulatory certainty on 1.6 million acres of private lands. Under the 30year contract, the National Marine Fisheries Service (NMFS) and the U.S. Fish and Wildlife Service will allow Plum Creek to do some damage to fish habitat while logging and managing lands in Montana, Idaho and Washington, in exchange for long-term improvements to fish habitat. Plum Creek, in return, is guaranteed that federal authorities won't impose new rules on the lands during the life of the contract, said Brian Gorman, spokesman for NMFS. The plan covers about 1.5 million acres in Montana, 40,000 in Idaho and 80,000 in Eastern Washington. The areas in Washington State include the Lower Tieton River, Lewis River and Ahtanum Creek. 

Tree Attack 
By now everyone is familiar with Julia Hill and her two-year residency in a 1,000yearold giant redwood on Pacific Lumber's land in Humboldt County, Calif. The story has taken a new turn. Over Thanksgiving, vandals serious maimed the tree with a chain saw, cutting about 32 inches around the tree and about a quarter of the way through the trunk. Some believe the vandals were disgruntled members of the timber industry, although the only evidence is that they were familiar with a chain saw. In any event, Pacific Lumber has come to the rescue, providing stabilization to the tree with thick metal bracing. It may be several years before anyone can tell whether the famous tree will live or die. 

Pope Resources Sells and Cuts 
Pope Resources said it will sell some of its resort and commercial properties and its Canadian forestry consulting business, and will cut 60 percent of its workforce, in order to focus on managing and expanding its tree farms. Pope will sell its Port Ludlow, Wash. real estate development activities and Canadian forestry consulting business. As a result, the company will cut about 150 jobs. The company said the sales would allow it to buy more timberland while prices are reasonable. Pope also said it will reduce its harvesting of trees by 25 percent next year to make cash flows from timber operations more stable. 

Willamette Fights Weyerhaeuser Offer 
Willamette has urged shareholders to reject a $7.1 billion cash and debt offer by Weyerhaeuser, claiming the hostile bid is an attempt to acquire the company at a time of depressed industry share prices. "The company is not for sale, but if it were for sale. Weyerhaeuser could pay significantly in excess of the offer price," Willamette said in a statement. However, Duane McDougall, Willamette chief executive, later said his company was not trying to negotiate with Weyerhaeuser. Weyerhaeuser has said it's committed to its $48pershare offer and argues that Willamette hasn't given any sign as to how it would create similar value for its shareholders. It also said it had filed a suit against Willamette to gain access to shareholder information. The stalemate suggested the takeover battle could drag on, although some observers believe Willamette shareholders will ultimately accept a deal. 

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