Maximize Benefits, Not Revenue

By Beacon Staff

Two weeks ago, I wrote about the dilemma facing the Montana Land Board – what to do with extremely valuable state land near rapidly growing municipalities. A small section of the Stillwater State Forest on the outskirts of Whitefish is an excellent choice for establishing a new policy where managing for outdoor recreation, watershed, wildlife habitat and open space trumps timbering and subdivision.

The rub is, such non-commercial uses might be illegal even if everybody agrees this option would benefit the most people for the longest time.

It would be difficult to place a dollar value on this 330-acre slice of state forestland. It’s so valuable for the same reason any real estate gets valuable: location. It happens to be on the shores of Whitefish Lake, which might be the priciest real estate in Montana. It also extends up the slopes above the lake into the coveted viewshed for not only the bulk of the resort community but also for a line of $10 million lakeshore castles.

The Land Board has a constitutional mandate to maximize revenue from state lands to fund public schools. And there is no doubt selling the so-called Swift section of the Stillwater State Forest for trophy homes would raise many millions for schools and public education, which in Montana are eternally underfunded.

I suspect some members of the Land Board, Montana’s top five elected officials, as well as managers of the Stillwater State Forest would like to see the Swift section remain open for public outdoor recreation. But with the mandate to use state lands for funding schools, how can they legally do it?

Right now, the Montana Department of Natural Resources and Conservation, the state agency charged with managing state lands and making recommendations to the Land Board, has no plans to offer the Swift section or any other section of the forest for sale to land developers. However, DNRC is working on the Beaver/Swift/Skyles timber sale, which probably will lead to traditional logging of the Swift section, including road building and cutting the majestic, 300-foot larches in the area.

Bob Sandman, who manages the Stillwater State Forest, told me his agency has already done a lot of public involvement on this timber sale and plans another round “very soon.” After the upcoming public involvement phase, DNRC will develop alternatives and probably offer the timber for sale this fall with cutting planned for next spring.

Later, after logging, after the access roads are built, after land developers express interest in paying millions for the Swift section, will DNRC offer the area up for rural subdivision? Right now, according to Sandman, there are no plans for residential or commercial development, even though DNRC has a new Real Estate Management Plan and has suggested using the Stillwater State Forest as a pilot project for implementing the plan and some locals suspect the seemingly endless school-funding shortfall might make selling the land too tempting to resist.

The DNRC tends to manage the timber the same everywhere, whether in a remote area or on the shores of Whitefish Lake, points out Jim Cancroft, a private forester working for Northwest Management, a consulting firm. “We want fire hazard reduction and to respond to forest health issues but not cutting on a large scale. We need an alternative where we can keep the big trees and not build permanent roads.”

“The problem is this viewshed and watershed is heavily used for recreation and is already part of this amenity-based economy,” adds Whitefish attorney Diane Conradi. “We need to come up with an alternative that doesn’t involve development or at least limits development.”

Conradi and Cancroft have been hired by Mike Goguen, a Silicon Valley venture capitalist from Sequoia Capital fame and now a wealthy landowner with holdings above Whitefish Lake and adjacent to the Stillwater State Forest, to look for an elusive alternative to revenue-maximizing timber or subdivision development.

So, how do we satisfy the state’s mandate to raise money and not extensively log or subdivide the Swift section?

One answer Conradi likes is what she calls “selling development rights,” which in essence means paying to not develop. Such “non-development rights” could be sold to another state agency or a municipality such as the City of Whitefish or even a private landowner like Mike Goguen. She calls this option “a conservation-based revenue source.”

Or, Cancroft adds, “We can pay them (DNRC) not to cut.”

He has already worked with Goguen to apply for what’s called a Timber Conservation License, which allows an agency, nonprofit or private individual to bid against loggers when the timber sale goes out to bid. If they have the successful bid, they can choose to not remove the timber or at least opt for limited logging.

“We’re already trying to incorporate some of this new thinking into the plan,” Sandman explained. The draft Environmental Impact Statement (EIS) will be out, in his words, “very soon,” and he hopes for lots of public feedback on it. The final EIS is due later out this year.

If ever there were a place to test some new options, this scenic site on Whitefish Lake would be it. I doubt many pieces of state land are more heavily used for outdoor recreation or provide a more prized viewshed.

I agree that the Land Board should view the Swift section as a pilot project, but not for implementing the real estate plan, but a pilot for a new policy for managing state land for maximum public enjoyment instead of maximum income. Let’s make a conservation- and recreation-based alternative work here in the Stillwater State Forest so the Land Board has an option for other key state lands near municipalities.

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