Elliott State Forest Management Puts Small Birds over Small Kids

By John A. Charles, Jr.

Last year the S&P 500 Index had a total return on investment of 32%. That should have been good news for Oregon public schools, which receive twice-yearly checks from an endowment known as the Common School Fund (CSF).

One of the largest assets supporting the Fund is the 93,000-acre Elliott State Forest, near Coos Bay. Net timber harvest receipts from the Elliott are transferred to the CSF, where the money is invested in stocks, bonds, and other financial instruments.

Unfortunately, the Elliott did not return 32% last year. It did not even return zero percent. The state actually lost $3 million. That is quite a feat of mismanagement for timberland valued at more than $500 million.

The Elliott is governed by the State Land Board, comprised of Governor John Kitzhaber, Secretary of State Kate Brown, and State Treasurer Ted Wheeler. Under their leadership, timber harvesting has steadily declined on the Elliott, so that roughly 78% of the forest is off-limits. Since overhead is relatively fixed (e.g., fire suppression and road maintenance), if harvest is halted, the forest loses money.


The Elliott is part of a broader portfolio of lands known as the Common School Trust Lands. Under the terms of the Oregon Admissions Act, the primary management objective for Trust Lands is to raise money for the Common School Fund. Therefore, the Land Board has a fiduciary duty to maximize timber harvest on the Elliott.

As environmental litigation became more widespread in the 1980s, it became clear that “fiduciary trust” would start taking a back seat to wildlife habitat preservation in state forests. Knowing this, in 1994 outside consultant John Beuter was retained by the Department of Forestry to look at various options for increasing revenue to the School Fund from the ESF. His conclusion: “Selling the Elliott is the only marketing alternative likely to significantly increase net annual income to the CSF.”

The Land Board did consider this option in 1995-96, but rejected it. Instead, the Board wasted more than a decade on a futile attempt at negotiating with the federal government on a so-called “Habitat Conservation Plan” (HCP) for spotted owls and marbled murrelets. But ultimately the Board was left at the altar by federal negotiators, and the HCP was abandoned.

This continual appeasement emboldened environmental activists, who sued to halt virtually all commercial logging on the Elliott. As single-issue advocates, they have never cared about the collateral damage to schools. They only want one thing, and that is a shutdown of commercial timber harvest on the ESF.

There is a better way. Selling or leasing the Elliott would result in much more revenue for schools while still protecting bird habitat, because private landowners are subject to Endangered Species Act regulation just as the state is. However, it’s well known in the industry that private landowners use different compliance techniques that allow reasonable levels of harvest, while also maintaining necessary habitat. Private owners generally don’t waste time trying to negotiate HCPs.

To its credit, the Land Board has recently acknowledged that the status quo is unacceptable and is reviewing bids for three parcels of the ESF that it may sell off this year, totaling some 2,700 acres. Selling this land would help erase the $3 million loss from last year, but the basic problem remains: The state itself is a poor manager of commercial timberland.

A recent study by independent economist Eric Fruits reinforces the conclusion made by John Beuter 20 years ago, namely that Oregon schools would gain additional revenues of $40-50 million per year if the state placed management of the Elliott in private hands. While this is not the only option available, it is clearly the one that would generate the most money for schools. Therefore, it needs to be seriously considered by the Land Board.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

Knowledge and Courage: What the West Needs to Take Back Our Public Lands

By Ken Ivory

The federal government continues to control more than 50% of all lands in the western United States. Locked up in these federally controlled lands are more than $150 trillion in mineral values and more recoverable oil―in Utah, Colorado, and Wyoming alone―than in the rest of the world combined. Failed federal forest policies prevent harvesting timber, which would improve forest conditions and wildfire resilience, provide useful consumer products and renewable energy feedstock, and revitalize rural schools and communities. FBI criminal activity alerts now warn that terrorists are encouraging the use of wildfire in fuel-laden federal forests as weapons for jihad.

There is no good reason for the federal government to retain control over these lands and resources in states like Oregon. We in the West have, in good faith, simply tolerated the federal government’s delay in honoring its more than 200-year-old obligation to transfer title to these lands for so long that now most people assume there must be some valid reason the federal government controls our lands and resources.

But there is none. At a recent Continuing Legal Education seminar to several dozen lawyers, a law professor (who is frequently quoted as saying it is “clearly unconstitutional” for states to take action to secure the transfer of title to their public lands) displayed an annual average precipitation map indicating that the federal government retains control of western lands because they are “arid.”

The second reason he gave was that the founders of the western states simply gave up their lands as a sort of ransom for the privilege of statehood, citing half a sentence in the statehood enabling acts: “… forever disclaim all right and title….” The funny thing is, this same half sentence is word-for-word the same in the statehood enabling acts of almost all states east of Colorado, where the federal government did dispose of their public lands.

In fact, for decades, as much as 90% of the lands in Illinois, Missouri, Arkansas, Indiana, Louisiana, Alabama, Mississippi, and Florida were kept under federal control. Then, one man had the knowledge and courage to rally citizens to compel Congress to transfer title to their public lands. His name was Thomas Hart Benton, a Democratic U.S. Senator from Missouri featured in President John F. Kennedy’s best-selling book Profiles in Courage.

The statehood enabling acts promising to transfer title to the public lands are the same for all states west and east of Colorado. It’s been done before―repeatedly and recently. And, returning these lands to state control is the only solution big enough to fund education; better care for our lands and forests; protect access; create jobs; and grow local, state, and national economies and tax base.

If we fail to stand up and take action to secure state and local control of our lands and abundant resources, it will not be because it is illegal, unconstitutional, or impossible. It will only be because we―and the local, state, and national leaders we “hire”―lack the knowledge and the courage to do what has been successfully done before.

Do your local, state, and national leaders know why there is a difference between the way the federal government has handled eastern and western lands? Have you inquired what specifically they are doing to compel Congress to honor the same statehood promise for our children and our future that Congress already kept with Hawaii and all states east of Colorado? Have you asked them what groups or influential individuals they will bring to the effort? Have you asked them what specifically you can do to help?

Now is the time to let our representatives know how transferring federally controlled lands back to the state can vastly benefit Oregon’s economy while preserving and using wisely our wealth of natural resources.

Ken Ivory is president of the American Lands Council and a member of the Utah House of Representatives. He was a guest speaker on this issue for Cascade Policy Institute in November 2013.

Supreme Court Should Reject Federal Regulation of Forest-Road Rainwater

By Daniel A. Himebaugh

Is rain in the woods the equivalent of hazardous waste? The answer might seem obvious, but the question is one that the U.S. Supreme Court will answer soon, in the case of Georgia-Pacific West v. Northwest Environmental Defense Center.

The environmental organization Northwest Environmental Defense Center sued Oregon state officials and several timber companies in 2006, seeking to require them to obtain federal Clean Water Act permits before using or authorizing the use of forest roads. NEDC won at the 9th U.S. Circuit Court of Appeals in 2011 by convincing the court that rainwater flowing through forest road ditches must be treated as industrial pollution that requires a federal permit.

In briefs with the Supreme Court, timber harvesters argue that requiring Clean Water Act permits for forest road runoff would do little to improve the environment, but would greatly harm logging in the United States.

Indeed, expanding federal Clean Water Act authority to cover forest road runoff makes no sense if the objective is to improve water quality. A new permitting regime would interfere with state programs that are already being enforced.

At last count, there were more than 150 state laws designed to prevent logging from becoming a major source of water pollution. According to a study made available by the U.S. Forest Service, such regulation is effective because it fosters flexibility, avoids impractical one-size-fits-all restrictions, and improves compliance.

Furthermore, federal permitting will create tremendous new costs. As the Supreme Court noted in 2006, the cost required at that time to obtain Clean Water Act “dredge and fill” permits was staggering―$271,596 for an individual permit. Similar costs would apply to as many as 5 million landowners if the court accepts the idea that forest road runoff requires a Clean Water Act permit. Big operations that can afford it will pay (and pass the cost on to consumers). Many small operations―which make up the majority of forest land owners―simply will not be able to pay.

Regulating forest road runoff under the Clean Water Act will also lead to intolerable delay. A few years ago, EPA was forced as a result of litigation to create a rainwater permitting program for shipping vessels. EPA needed over two years to get the program up and running, and that program has a much smaller scope than a program covering forest roads would have.

How long would it take the agency to develop a program for forest roads? Nobody knows, but one thing is certain: Any delay in developing a new program would harm timber harvesters, confronting them with a brutal choice. If they continued using forest roads, they would run the risk of becoming a defendant in a Clean Water Act lawsuit. But no longer using forest roads would mean abandoning their livelihoods.

The right path for the Supreme Court should be clear: The justices should consider the destructive effects of treating forest road runoff as industrial pollution under the Clean Water Act, and reject NEDC’s claims when they rule on Georgia-Pacific West v. NEDC.

Daniel A. Himebaugh is an attorney with Pacific Legal Foundation in Bellevue, Washington. He represented over a dozen timber industry, conservation, and educational organizations in filing a friend-of-the-court brief urging the U.S. Supreme Court to reverse the 9th Circuit’s decision in the Georgia-Pacific West case. Himebaugh is a guest contributor for Cascade Policy Institute, Oregon’s free market research center. A version of this article was originally published by The Capital Press, October 2012.

Measure 81 Would Take Salmon off the Table

By Thomas Dulcich and Michael Barton

Oregonians are most fortunate to border the Columbia River, prized for its scenic beauty, recreational opportunities, power generation, irrigation, fishing resources, transportation, and a long list of additional values. We pay for the management of this complex resource with our taxes and utility bills; but if Measure 81 passes this November, Oregonians will have another distinction. We alone will be prohibited from enjoying Columbia River salmon and other fish caught by non-tribal commercial fishers.


Measure 81 bans a method of commercial harvest known as gillnetting, but it also includes a stealth provision: a purchase ban for Oregonians only. The “purchase ban,” found in Section 2 (2) of Measure 81, would prevent Oregon buyers and consumers from buying non-tribal net-caught fish from the Columbia River. If you live in Washington, you still would be able to enjoy Columbia River salmon. The same is true if you live in Washington, D.C., or California, or…well, anywhere but Oregon. What justification is offered for prohibiting Oregon buyers and consumers from purchasing Columbia River-caught salmon? None.


Measure 81 is the latest effort by sports fishing interests to increase their share of Columbia River fish at the expense of commercial fishing that supplies product to grocery stores and restaurants. Currently, fish are allocated among the small commercial fleet, sports fishers, and tribal fishers (who also oppose Measure 81).


What is the source of the conflict? Perhaps it stems from the industrialization of sports fishery and the resulting overcapitalization. The Columbia River commercial fleet, which fishes for consumers, is restricted by “limited entry” laws to a specified number of licenses (only 200 in Oregon). The “guide industry,” which markets day trips for hobby fishermen, is not limited in number by Oregon law. The financial barriers to entry to become a for-profit fishing “guide” are relatively low (a $50 Marine Board license, a pick-up truck, and a boat), so it has been easy, in the absence of limited entry, for this “commercial sport fishing” endeavor to become overcapitalized. Over the past 10 years, hobby fishers got 80% of the Columbia River Spring Chinook and 80% of the sturgeon, while the non-tribal consumer access fleet got 20%. The allocation of other runs also favors recreational fishers. Does it make sense for consumers to get even less?


The rationale offered by the backers of Measure 81 includes the claim that removing gillnets from the Columbia River will enhance fish conservation. This idea has been promoted with scary-sounding but unsubstantiated claims of widespread killing of other wildlife by gillnets. In fact, gillnets long have been the only method allowed by law and regulation for the commercial harvest of Columbia River fish, in large part because this is the method which has the least negative impact.


While he opposes Measure 81, Governor John Kitzhaber has ordered the Oregon Fish and Wildlife Commission (and has “suggested” to the Washington Commission) that it adopt administrative rules severely restricting the commercial fleet by taking away the mainstream Columbia River and limiting commercial fishing only to very tiny back waters or side channels known as the “select areas.” The governor’s plan also will reduce consumer access to products of the Columbia River, such as the Spring Chinook salmon, Summer Chinook salmon, sturgeon, Fall Chinook salmon, and Coho salmon. The commercial fleet, composed of a few hundred small family businesses and several fish processors (mostly in rural Oregon and Washington), is of the opinion that Governor Kitzhaber’s plan will kill their industry and jobs―not in an overt, sudden way, but instead by slow death.


Why should Oregon consumers care about this? First, locally caught salmon is a very healthful source of natural protein, teeming with omega-3 heart-healthy vitamins. Second, Oregon taxpayers (and ratepayers) contribute through their taxes and utility bills to the ongoing work to sustain salmon runs, which must migrate through the hydropower system on the Columbia River and its tributaries. Given this financial investment, it is reasonable that all Oregon consumers―not just hobby fishermen―be able to enjoy Columbia River salmon. Measure 81 and Governor Kitzhaber’s plan are anti-consumer and anti-Oregon, and both should be defeated.


Thomas Dulcich is an attorney and one of the 200 Oregon gillnet fishing permit holders. Michael Barton is a member of Cascade Policy Institute’s board of directors.


Why the School System Doesn’t Just “Buy Local”

By Erin Mae Shiffler

The Oregonian’s recent PolitiFact “Feds Don’t Think Local on School Lunch Ingredients” was prompted by Senator Ron Wyden’s complaint that “Oregon schools receive millions of dollars per year in federal school lunch assistance and yet they are required to spend that money almost anywhere but Oregon.” Politifact concluded that Wyden’s claim was “true” because “96% of food served in Oregon schools and purchased with federal dollars came from another state.” This is a false conclusion. Just because the “one definitive document” cited shows that most school food comes from out of state doesn’t mean it is required to come from out of state.

Oregon schools are not “required” to spend federal school lunch money outside Oregon. For the largest portion of their purchasing budget, schools must obtain food products through a competitive bidding process that also includes quality and nutrition standards.

Requiring food suppliers to bid makes sure schools do not favor suppliers unfairly. The bidding process allows schools to receive bids from local producers and suppliers throughout the country. Producers which meet quality and nutrition standards at the lowest cost will be chosen. Schools cannot afford to discriminate against out-of-state suppliers in favor of local food sources because they have a limited budget with which to feed the whole student population.

The other aspects of this process that may impede local suppliers are the nutrition and quality standards. These standards may increase the cost of food and make it harder for Oregon’s farms to produce items up to par while simultaneously underbidding producers in states like California. But standards are applied across the board, not just to Oregon suppliers. These standards include criteria such as: lunches must provide at least one-third of the recommended dietary allowances for key nutrients, they may have no more than 30 percent of their calories from fat, they must have less than 10 percent of calories from saturated fat, they must reduce sodium levels whenever possible, and they must increase fiber content whenever possible.

According to the article, Sen. Wyden assumes that local produce is more nutritious than food from out of state, but this may not be true. According to Cynthia Sass, Nutrition Director for Prevention magazine (January 2008): “A lot of people think fresh is best, but believe it or not, frozen produce is even more nutrient packed. That’s because the moment produce is picked, it starts to lose nutrients, but freezing slows that loss. A 2007 study found that vitamin C content of fresh broccoli plummeted 56% in 7 days, but dipped just 10% in a year’s time when frozen. In addition, the levels of disease-fighting antioxidants called anthocyanins actually increased after freezing.” This is just another reason why schools may choose to buy from outside Oregon.

A small portion of Oregon schools’ purchasing budget must be spent on specific items from the USDA’s program and is called “commodity money.” Commodity money is an extra $0.2225 per lunch served the previous school year. The bulk of the federally funded budget is non-commodity money that is reimbursed depending on the student’s status. For schools with less than 60% of children qualifying for free/reduced price lunches, the reimbursement rates are $0.26 for paid, $2.37 for reduced price, and $2.77 for free lunches. The rates are even higher in schools with more than 60% eligible.

According to a study of the commodity program done by the Food Research and Action Center, “when only expenditures on food are included in the calculation, the value of the commodities makes up about one-fifth of the federal resources spent on food for school lunch.” This means that four-fifths of the money is subject to the requirements above and do not need to be purchased from the USDA’s list of food. If a school found better quality items at lower prices through bids from Oregon suppliers, then they could spend about 80% of their federal funds here in Oregon.

If we are only spending 4% in Oregon, there are several possible reasons. It could be because the supply locally costs too much, lacks in quality, local suppliers are not bidding for the schools’ business, non-commodity money is following the commodity money to a single supplier to make buying easier, or the person at the school district in charge of buying food doesn’t have time to personally contact all of the small local providers that could supply cheaper and better quality food.

Oregon schools do not refuse to buy from Oregon suppliers because federal restrictions require them to buy outside Oregon or from any particular supplier. If we want to increase sales to local vendors, then local farms and food producers must offer bids for high-quality products at competitive prices. This scenario is incorrectly being used to promote the “buy local” mentality when in reality, buying local right now would only hurt the kids this program is supposed to feed because higher food prices would decrease the quantity that can be purchased. If our schools are buying food from anywhere but Oregon, don’t blame the federal government. Instead, figure out why Oregon suffers from a lack of locally available quality and low-cost food options.

Erin Mae Shiffler is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization. She is a student at Brigham Young University-Idaho.

Steve Buckstein interviewed about his commentary, Oregon’s Budget Transformation

We sat down with Cascade Policy Institute Senior Policy Analyst, Steve Buckstein, to talk about his latest commentary, Oregon’s Budget Transformation which discusses government trying to do efficiently that which it shouldn’t be doing at all.


The Wild Gray Wolf―No Romance for Oregon Ranchers

The journey of the gray wolf known as “OR-7” from his home in Wallowa County, Oregon to south of the California border has become a minor modern wildlife epic. It is fascinating to witness the migration of a wild animal through Oregon’s wide-open spaces, tracked by wildlife biologists.

While OR-7’s travels have appeal as a classic Western tale of the wilderness and its perils, it is important to remember that wolves are, in fact, wild. Reintroducing wolves into rural Oregon affects the people and the livestock living there, particularly ranchers who suffer the intimidation, injury, and death of their animals. Wolves exact real costs on ranchers who lose livestock and contend with changes in animal behavior spurred by harassment from a natural predator.

The Oregonian reports that Idaho’s wolf population grew from 35 in 1996 to about 800 in ten years and that Oregon currently has 28 wolves. As Oregon’s wolf population grows, Oregon’s legislature and the Oregon Fish and Wildlife Commission need to listen to the experiences of rural Oregonians living in proximity to freely roaming predators. Ranchers need to be legally empowered to reasonably defend themselves, their families, and their animals.

OR-7’s exploration of the wilds of Oregon may be a true-life adventure for those who watch Internet videos of him from hundreds of miles away. But for rural Oregonians watching wolves cross onto their property near their cattle, the tale of the wild wolf is not so romantic.


Note: On Wednesday  the Oregon Legislature was scheduled to vote on House Bill 4005. If passed and signed by the governor, the law would allow ranchers who lose livestock to wolf depredation to receive some compensation in the form of a tax credit.


Karla discusses Alberta’s Bill 36 on CAEPLA Connections in Canada – Part 2

Click here for Part 1

On July 2, 2011, Karla continued discussion with CAEPLA CONNECTIONS LANDOWNER TALK RADIO about an Alberta land use law similar to one instituted in Oregon.

From the CAEPLA website…

This week on CAEPLA Connections Landowner Talk Radio, Keith Wilson, Karla Kay Edwards, and Kevin Avram discuss the impact of Bill 36-like legislation in Oregon. Bill 36 is an Alberta law that is going to change Alberta in a way that few people realize. In many instances, it is also going to affect property values in ways that few people have thought about. The Bill is the Stelmach government’s central planning land use law.

For more information, visit http://www.landownerassociation.ca

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