As timber payment fight drags on in D.C, Hood River County plans for worst

March 10, 2012

As legislators in Washington, D.C., and Salem make an attempt to gallop to the rescue of 18 cash-strapped southern and coastal Oregon timber counties, the 13 other Oregon counties, including Hood River County, which receive federal timber payments could be forgiven for wondering "What about us?"

For decades, Oregon timber counties have received federal payments to offset revenue which cannot be collected from federal forestland inside the counties. Those payments are set to expire June 30.

Oregon and California (O&C) Railroad counties, which run up and down western Oregon, have received their funding differently than other counties in the Secure Rural Schools Act. Payments to the O&C counties go into the county general funds. For the rest of the counties which receive Secure Rural School payments, the majority of the payments go into the county roads fund.

And that is where counties like Hood River are hurting.

Hood River County received approximately $750,000 in timber payments last year. For the next year, they have budgeted for only $85,000 from federal timber payments.

That's a big chunk of the county roads budget, which was $3.5 million this year.

"We've been doing our best over the years to prepare for this," said County Budget Supervisor Sandra Borowy.

The county has built up a reserve of about $11 million in the road budget. At current funding levels, that would mean another three years of operations before things began to get tricky.

Last year the County Commission voted to not allow any new roads into the county road systems. Other possibilities include allowing some roads to return to gravel and not plowing some roads as quickly during winter storms.

The Oregon Legislature closed out its session last week by passing a measure which would allow the state's O&C counties to tap their county road funds to fund other services while a long-term solution is sought at the national level.

In Congress, Rep. Greg Walden, R-Hood River, and Democrats Peter DeFazio and Kurt Schrader have introduced a bipartisan draft legislation (O&C Trust, Conservation and Jobs Act) to establish a state trust fund for the O&C counties, which would allow for increased timber revenues, by allowing previously managed timber stands under 80 years old to be used as timber harvests on a rotating basis.

However, what the draft legislation, which has yet to get a hearing from the House Natural Resources Committee, does not include is a solution for the other counties across the nation which also receive Secure Rural Schools funding.

On the same day as Walden, DeFazio and Schrader introduced their draft legislation, Rep. Doc Hasting, a Washington state Republican who chairs the natural resources committee, introduced a bill which does include a solution for the other counties.

However, the two proposed pieces of legislation appear likely to bog down for separate reasons.

The Hastings bill (HR 4019: Federal Forests County Revenue, Schools, and Jobs Act of 2012) calls for a dramatic increase in timber harvests on federal lands.

The Hastings bill calls for yearly revenue from harvestable units in the national forests system to equal 60 percent of the annual gross receipts from the unit from 1980-2000 and a minimum sale level of 50 percent of the annual timber volume sold from each unit over the same time period.

Oregon would see a large growth in its payments under the plan, about $280 million per year as opposed to $127 million in payments in 2010, according to Headwaters Economics, a natural resources research firm in Bozeman, Mont.

However, with that increased revenue would come a dramatic increase in the amount of timber harvested from federal forest lands in Oregon, including the Mt. Hood National Forest. In 2010, a total of 310,000 million board-feet of timber was cut in federal forests in Oregon. The minimum sale level to reach the required revenue standards in the Hastings bill would be around 10.7 million board feet.

Over the 20-year time period for averages to establish the minimum sale and harvest levels, the record high for Oregon timber sales was 4 million board-feet in 1987.

Walden spokesman Andrew Whelan said that Walden hopes that the two pieces of legislation might be combined at some point.

"The solution needs to be long-term and put people back to work and create jobs in these rural counties where unemployment remains far into double digits … anything short of that is a stop-gap," Whelan said.

However that is where the bipartisan cooperation which marked the Walden, DeFazio Schrader bill might come to an end.

The Hastings bill garnered unanimous Republican support in the House Natural Resources Committee, and was countered with unanimous democratic opposition, with the exception of DeFazio who voted "present" to allow him to continue to work on getting the draft bill into committee.

Nearly a month later, that has yet to happen.

On Thursday the Senate passed an amendment to a transportation funding bill which would extend the Secure Rural Schools act by one year. However the legislation still needs to pass the House and would not resolve the long term funding issue.

"We've been trying to do the planning," Borowy said. "But when our reserves are depleted for public works - what happens next?"

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