Page 29 - Flathead Beacon // 9.7.16

CLOSING RANGE DAVE SKINNER
GUEST COLUMN DALE BOSWORTH, DAVID A. MIHALIC & RYAN ZINKE
WE HAVE A LAND WMANAGEMENT PROBLEM
HILE REASONABLE PEOPLE nation in collaborative land manage- might disagree on any num- ment e orts, but unfortunately we ber of issues, we agree that also lead in litigating their results. Col-
PAST, PRESENT, IFUTURE PART 4
N EXAMINING MONTANA’S FOR- estry sector, let’s move now to Mon- tana’s role in the “big picture” of the
national forest-products market basket, more speci cally, Montana’s part in Wey- erhaeuser’s strategy.
After merging with Plum Creek, Wey- erhaeuser now owns over 13 million acres of U.S. timberlands in 19 states, plus har- vest rights on 14 million acres of Crown lands in Canada – a continental empire of which Montana comprises a tiny, tiny part.
In any business, long-term invest- ments should have the highest possi- ble rate of return. For “core” productive timber lands, the rate of return is deter- mined mainly by the growth rate of the forest – functioning scally as the “inter- est rate” of the forest land investment of buying land, planting trees and guarding them until harvest time.
The Montana Department of Natural Resources and Conservation, along with commercial forest owners everywhere, uses a guideline called culmination of mean annual increment (CMAI), which is “the ideal harvest or rotation age in terms of most e cient net annual volume production.” This CMAI is used to deter- mine “rotation,” or the number of years between harvest, which when combined with data on site productivity, allows Montana state trust managers to deter- mine long-term sustained yield harvest from on Montana state forest lands.
What is Montana’s typical rotation age? For many lodgepole forests in Mon- tana, the CMAI is generally regarded as 80 years, even though lodgepole lives at most 120 years. My buddy, Evel the Log- ger, or just Evel, tells me that most of the trees he cuts for sawlogs (not pulp) tend to be between 60 and 100 years old.
As for Weyerhaeuser’s continen- tal expectations, the company’s web- site explains that “25 to 40 years might pass before nal harvest delivers the full return on our investment” – that is basi- cally the overall average CMAI for Wey- erhaeuser’s national land base, the “bio- logical rotation.”
Is this di erence important? No, it’s critical. Businesses today focus on “net present value” (NPV) for sharehold- ers, so let’s again consider Net Present Value and say we want a 6 percent annual return realized at harvest, years 25, 40
and 80. Our dollar collected in year 25 is worth 23 cents today. 40 years, 9.7 cents. 80 years? Zero point nine four cents – and we haven’t adjusted for either in a- tion or “risks” like wild re or disease.
Crazy? Seems so, but it’s the bitter reality of forestry, compound interest and time. Forests that take 80 years to grow are worth less than a tenth, not half, of a forest that will grow in 40 years. With that in mind, might Weyerhaeuser’s managers (or those of any other timber REIT) be actively considering disposing of those properties with rotations higher than 25 to 40 years? Say, in Montana?
Sure – Plum Creek was already think- ing, and doing, that for a much longer period of time than most people realize.
After buying Champion Interna- tional’s 867,000 acres for $260 million ($300 an acre, $500 today) in summer 1993 (Stimson bought the mills, all now closed), Plum Creek stopped expanding in Montana, mainly because there wasn’t much left to buy.
Instead, Plum Creek went to work acquiring shorter-rotation timberland in other states, examples being buying SAPPI in Maine and merging with Geor- gia Paci c’s land division in the south- east. Plum Creek was able to do so thanks to A.) tax-favored REIT status after 1999, which made loans easy; and B.) cash from existing stands of comparatively old, dense, quality wood – the legacy of rail- road-focused Northern Paci c’s sort-of- but-not-really-benign neglect.
In 2004, Plum Creek sold 89,000 acres in the Blackfoot, in 2008, 311,000 acres in the Swan, Potomac and Fish Creek coun- try, and last year, sold the 117,000-acre Clearwater/Placid block. Signi cantly, these sales were not to any forest-sec- tor competitor or private entity. Rather, these sales were brokered by The Nature Conservancy with the intent of eventual sale to government agencies as well as select private “conservation” buyers.
Why were none of these lands bought by, say, Pyramid? Stoltze? Stimson? R-Y? Or even another Real Estate Investment Trust? Simple – from the government, from taxpayers, via TNC, Plum Creek was paid crazy-stupid prices no rational pri- vate investor would ever touch.
Might Weyerhaeuser seek the same for an exit strategy?
Theodore Roosevelt was right. Our pub- lic lands belong to all Americans and are best managed under federal protection. Roosevelt de ed convention and coura- geously acted to save America’s dimin- ishing natural resources, bringing 230 million acres of public land under increased protection as national forests, refuges, parks, and monuments.
He and Gi ord Pinchot, whom Roo- sevelt appointed rst Chief of the U.S. Forest Service, are credited with estab- lishing the modern “conservation ethic” by using scienti c management princi- ples that have become the bedrock of public land management policy. Indeed, their vision that conservation means promoting resource management along with strict protection is well re ected in our diverse system of national parks, forests, wilderness, and public lands.
Today, Roosevelt’s conservation ethic is in jeopardy as special interests, end- less litigation, and political gridlock threaten proven best practices, balanced use, and common sense while tying the hands of our resource professionals. The result is catastrophic wildland res, destruction of critical habitat, manage- ment decisions made by lawyers, and the loss of millions of dollars in local reve- nue that funds schools, infrastructure, and preservation.
What is needed to restore the con- servation ethic is better management by resource professionals, greater col- laboration with citizens, and increased investment in our public lands. But “better” management does not mean the transfer or the sale of federal lands. The National Environmental Policy Act (NEPA) is an e ective management tool to identify risks, mitigate potential impacts, and to prevent inappropriate use. But Congress never intended NEPA to be a tool to stop sound resource man- agement. Today, the facts supporting the need for better management are clear. In just 20 years, the U.S. Forest Ser- vice has gone from spending 15 percent of its budget on ghting res to over 50 percent. Last year, over $2 billion was spent ghting re. The season is longer, res burn hotter, and the devastation to watershed and wildlife is undeniable.
The fact is, we do not have a re prob- lem; we have a land management prob- lem. We need to restore scienti c man- agement principles, promote collabora- tion and balanced use, and allow profes- sional land managers to manage.
Montana is proud that we lead the
laboration is not easy. It takes time, resources, and commitment by all stake- holders to come together and reach con- sensus. Such e orts should be rewarded. But too often, the collective decisions are stopped by punitive litigation from objectors who believe their own agenda is more important.
The result is that all management progress stops and the collective will of stakeholders is subverted. The outcome is that good solutions are tossed out and stakeholders are told to start over. In the meantime, opportunities are lost and best practices disrupted due to the tyr- anny of a few. Too often, the next step is to lose heart or become frustrated and to x the blame, instead of xing the problem.
Meanwhile, the USFS spends the lion’s share of their budget ghting res and defending litigation. Foresters are faced with mountains of paperwork rather than being in the eld. Parks face crowding, resource damage, and decay- ing facilities. Refuges remain short- sta ed, and wildlife su ers while pub- lic lands lose native plants and su er unmanaged use. Common sense would say we need more resource profession- als and scientists on the land and greater collaboration with citizens to promote a healthier public landscape.
Montana is blessed to have world-re- nowned national parks among our national and state forests and national wildlife refuges. The success of Glacier and Yellowstone may also be a threat to their sustainability unless we pre- pare now for the future. With visitors at record levels we already see those who believe people are the problem and the solution is to keep people out. It is time we demonstrate the courage of Teddy Roosevelt, invest in our parks and for- ests, and rethink the use of our adja- cent public lands to relieve some of the burden. We believe this will take col- laboration and both public and private resources to improve access, upgrade recreation amenities, protect habitat, and better manage public use and access.
We believe all Montanans cherish our public lands. We must act now – together – to restore a true conservation ethic. Roosevelt had it right when he stated “We have fallen heirs to the most glori- ous heritage a people ever received, and each one must do (their) part if we wish to show that the nation is worthy of its good fortune.” We agree.
Mike (Uncommon Ground) Jopek and Dave (Closing Range) Skinner often fall on opposite sides of the fence when it comes to political and outdoor issues. Their columns alternate each week in the Flathead Beacon.
Dale Bosworth is former U.S. Forest Service chief; David A. Mihalic is former Yosemite & Glacier National parks supervisor, and Ryan Zinke is Montana’s congressman
SEPTEMBER 7, 2016 // FLATHEADBEACON.COM
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