Diesel soars, Timber benefit justified, Forest carbon doubts

By Rex Storm, Forest Policy Manger
Oregon Associated Loggers,

Diesel Climbs to High: US retail prices of diesel fuel surged January’s first week, soaring an average 6.5 cents to $2.80 per gallon, its highest level in over a year.  At press time, the US average rose further to $2.91/gal.  By January 19th, Oregon’s average diesel price had climbed 11 cents (+4%) from the previous month to $2.902 per gallon, the nation’s 26th highest average price, according to Fuel Gauge Report (www.fuelgaugereport.com).  The rise is due to rising crude oil price and unexpectedly high heating oil demand in a cold US winter.

Study finds Private Forest Huge Economic Benefit: A report, commissioned by National Alliance of Forest Owners (NAFO) and written by Forest2Market, quantified large economic contributions to the US economy from private “working” forests.  One thousand acres of a privately-owned forest generates $277,000 in state gross domestic product, while the same area of public forest generates just $41,000.  A 1,000-acres of private forest annually generates 8 jobs, $270,000 payroll, $9,950 state taxes, and $733,000 in sales.  The report online: www.forest2market.com/f2m/f2m-impact/

Forest CO2 Market Promises Uncertain: A global market for carbon offsets from planting trees and “preserving” forests could stall—which would not be a bad thing.  Bureaucratic promises of markets for forestry carbon offsets, claimed to be worth $150 million, would not materialize unless the US Congress passes a so-called “cap & trade” climate bill.  Known as “cap & tax”, such legislation would tax energy users, producers and most emissions.  A recent report says faltering congressional attempts to pass such a bill, means that a forest carbon market is unlikely soon.

Bill to Nationalize Health Business Rolls through Congress: Business strongly opposed the two 2,000-page healthcare bills, which passed the US House and Senate in late 2009.  Headed for February reconciliation of the two bills by a super-majority Democrat House & Senate, President Barack Obama is expected to sign the bill.  This socialist health care takeover scheme would seize one-sixth of the US economy and ration medical care through a new government bureaucracy.  The bills dictate new taxes and stringent requirements on employers to offer employee health coverage.

Health Mandate Bill Shocks Construction Contractors: The healthcare bill may include a surprise price tag for small business contractors, defined as “construction industry.”  Added just 48-hours before the Senate’s final vote, US Senator Jeff Merkley (D-OR) amended the $750 employer mandate penalty to hit “construction” firms with as few as five employees, forcing them to provide health insurance to all employees.  Although the final bill provisions are unknown at press time, this assault on small business contractors is clearly patronage for the unions.  Stay tuned.

Builders Split from NAHB: Sixteen of the nation’s largest home builders created their own new trade association, divorcing from the 200,000-member National Association of Home Builders.  The new association, Leading Builders of America, will work toward housing sector recovery, and other home building industry issues.  Leading association members apparently had irreconcilable conflicts with NAHB, such as tax code provisions.  NAHB is primarily composed of small-business builders, which have unique capital and regulatory challenges that often conflict with the large outfits.

Blue Heron Paper Bankruptcy: Oregon City’s Blue Heron Paper Co. pulp & paper mill, filed for Chapter 11 bankruptcy protection, because of “an ongoing liquidity crisis due to the loss of newsprint orders and a steep decline in newsprint and specialty paper pricing.”  The firm announced it intended to reorganize its debt and emerge with a healthier financial structure.

Siskiyou Rail Proposal: The federal Surface Transportation Board is considering a request by Roseburg Forest Prod. and Timber Products, to have West Texas & Lubbock Railway operate the 218-mile Siskiyou Summit railroad.  The STB must approve transfer of the rail-line, located between Dillard, OR and Black Butte, CA.  The shipper’s request came after the Central Oregon & Pacific Railroad, which leases the line from Union Pacific, curtailed service between Ashland and Weed and reduced northbound service.  Another competing proposal is in the works by an upstart CA entity.

Rail Reform Bill in Congress: A landmark revamping of federal railroad regulation unanimously cleared a US Senate Committee in Dec.  Industry has for years lobbied for the sweeping bill, which would take steps to reduce an outdated railroad monopoly that’s led to high freight costs, rampant inefficiencies, poor shipping service, and stifled innovation and competition.  The legislation is still months from becoming law, as the full Senate must act, the anti-business US House must act on its own bill, and the President would need to be convinced to sign the bill.

Senator Introduces Eastside Bill: US Senator Ron Wyden (D-OR) introduced the ‘Oregon Eastside Forests Restoration, Old Growth Protection and Jobs Act,’ S. 2895—which would add more bureaucracy and promised increase in national forest “treatment” to 120,000 acres/yr.  Although a couple industry and green groups support the bill, its long-term ramifications are dubious at best.  If the bill ever became law, any harvest increase would require finding new federal budget.  Plus, the bill’s permanent prohibitions would stifle good forestry, such as a maximum 21” dbh cut tree, excessive stream buffers and road bans.  Announced with media fanfare, many acknowledge that the bill is more about election-year posturing, rather than seeking real solutions.

Montana Senator Offers Local Forest Bill: In a rush to find parochial band aids for ailing federal forestry, US Senator Jon Tester (D-MT) introduced another state-targeted bill: the Forest Jobs & Recreation Act, S. 1470.  Tester’s bill would dictate specific actions for Montana national forests, such as 336,000 acres of new national recreation areas, 680,000 acres of new Wilderness, boosting logging to 10,000 acres/year in the Beaverhead-Deerlodge and Kootenai national forests (7x current).  Tester’s bill was written with input from industry and conservationists.

Feds Pressure Oregon Stream Rules: The federal Environmental Protection Agency and NOAA-Fisheries wrote to the OR Dept. of Environmental Quality—threatening that Oregon “doesn’t do enough to protect” forest streams from logging.  The skirmish began with an environmental lawsuit against the EPA, aimed at blackmailing the OR Board of Forestry to increase stream buffer rules, rather than face losing $5 million/yr of federal funding.  The Board, ODF and industry will defend Oregon’s forest practices rules, because they provide excellent water quality without excess buffers.

Industry Talks to Forest Service: In December, a group of forest industry representatives, including AOL, met with US Forest Service NW Regional Forester Mary Wagner, forest supervisors and her staff.  Attendees discussed the importance of FS timber sale offerings, and promised federal stimulus contracting, needed to maintain logging and milling infrastructure across rural Oregon.  In recent years, promised timber sale volume has been delayed or short, due to litigation, faulty planning, poor appraisal, excessive restrictions, cumbersome contracting, and insufficient value/acre.

Forest Service Planning Rule Rewrite: US Agriculture Secretary Tom Vilsack announced Dec. 17 that the Forest Service has begun revising its crippled planning rule, which is needed to guide development of national forest plans.  All five versions of former planning rules (1982, 1996, 2000, 2005, 2007) have been litigated aggressively by environmentalists, and overturned in federal courts.  The resulting debacle has left national forests hobbled by layers of outdated and conflicting plans.  A 60-day comment period ends Feb. 16.  For more information, visit: www.fs.usda.gov/planningrule

Feds Lose Survey & Manage Case: In December, federal Judge Coughenour issued a damaging ruling that returns US Forest Service and Bureau of Land Management timber sale planning back to 1994-era presale searches for over 400 uncommon slugs, snails, lichens and fungi.  The judge ruled that the cumbersome “survey & manage” program—mandated by the ‘94 Northwest Forest Plan—is working well and the agencies must keep it.  The FS and BLM had twice scaled-back the ridiculous surveys; but repeated environmental lawsuits and court rulings overturned their better judgment.

Bull Trout Proposed Habitat Expansion: The US Fish & Wildlife Service proposed quadrupling the designated critical habitat for the listed bull trout, a cold-water char that’s not actually a “trout”.  The FWS proposed designating 23,000 stream miles and 533,000 lake acres in OR, WA, ID, MT and NV, the first time unoccupied bull trout streams will be sanctioned.  This proposal is another indicator of how the Obama administration is rolling-back previous upgrades to the beleaguered Endangered Species Act.  The bull trout proposal was supported by environmental group lawsuits.

Siuslaw New Leader:
The deputy Forest Supervisor on the Humboldt-Toiyabe Nat. Forest in NV has been selected as new Forest Supervisor of the Siuslaw National Forest in Corvallis.  In March, Jerry Ingersoll replaces Barnie Gyant, who moved to California.  Jerry worked at different levels of the Forest Service, in CO, NV, AK, AR, and Washington, DC.  He began his career in 1987 after receiving degrees from UC Berkeley.

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