Taxpayers Big Losers In Logging Estimates Of Profits From Salvaging Timber Neglect To Include Overhead Costs
Copyright 1995, The Spokesman-Review
A massive emergency logging plan being touted as a bonanza will actually cost American taxpayers more than $200 million, according to federal budget sources.
Environmentalists and budget watchdogs are alarmed over the House passage of an appropriations bill that includes salvage timber sales of 6.3 billion board feet over the next two years.
The volume of the sales is considered significant by the industry because federal forests have been virtually closed to logging by environmental challenges during the 1990s.
Removing the dead and dying timber will improve forest health and fuel the economy, supporters say.
Even if the Senate approves the logging amendment, President Clinton is expected to veto it.
Crafted by Rep. Charles Taylor, R-N.C., and Rep. Norm Dicks, D-Wash., the bill relaxes environmental laws to speed logging of burned and diseased timber before it loses market value.
Taylor, a timber industry booster, says the trees will bring the federal treasury and U.S. Forest Service $345 million.
Timber industry officials predict the windfall will exceed $1 billion.
Federal budget sources say those figures are gross revenues from the sale of trees that do not include overhead costs such as building roads, reforestation and sale preparation.
The former deputy director of the Congressional Research Service, an arm of Congress that tracks money, says taxpayers will lose at least $210 million.
Other estimates have the deficit as high as $300 million. The environmental group Save America’s Forests says Taylor’s bill will cost taxpayers $1 billion from the associated environmental damage.
“This is a cockamamie scheme,” says Robert Wolf, the former No. 2 official at the Congressional Research Service for 12 years. Although he retired in 1984, Wolf still tracks federal timber revenues as a hobby.
“If you had a business that did $1 million worth of sales and you forgot to mention you had $2 million in costs, you’d be fooling the public,” Wolf says.
Forest Service officials say the agency has not crunched the numbers yet, but agreed the plan will cost more than it generates.
“There is a lot of concern in the Forest Service that if we’re forced to go in and cut 6 billion board feet over the next two years, there are going to be a lot of below-cost sales,” said an agency official in Washington, D.C.
“Most of this timber is inaccessible. It’s not along highways. That will jump up the costs,” said the official, who didn’t want his name used.
Repeated calls to Taylor and Dicks were not returned last week.
The Forest Service says last summer’s wildfires burned 3.6 billion board feet of timber with a value of $798 million. The burned timber contains enough lumber to frame more than 333,000 houses.
Most of the fires were in Montana, Idaho, and Eastern and central Washington. Taylor’s salvage amendment does not target specific forests, but the agency, as well as environmentalists and timber companies, agree the Inland Northwest will bear the brunt of logging operations.
Only forests in Northern California and Western Washington and Oregon consistently profit from timber sales, Wolf said, because of their volume and value.
The vast majority of forests lose money on timber, he said.
For every dollar generated by federal trees, a quarter goes to counties for roads and schools. Timber companies also get paid to build expensive logging roads. Reforestation and preparing salvage timber sales push them into the red, Wolf said.
In addition, burned trees don’t command as high a price.
After expenses, the Taylor amendment will cost taxpayers $35 per 1,000 board feet of timber harvested, he said, or $210 million, based on averages since 1983.
Taylor, a four-year congressman, has received $71,500 in campaign cash from timber companies, according to the Western Ancient Forest Campaign.
In Taylor’s North Carolina national forests, taxpayers lost $49 million to below-cost timber sales since 1983, Wolf said.
A University of Oregon economist, Ed Whitelaw, is more pessimistic. His new study says taxpayers will not only subsidize the logging, but also to repair environmental damages.
Conservationists are outraged at the potential for harm. They also note that new roads cutting through remote forests will give poachers easier access to endangered species, such as grizzly bears.
“We’re handing our forests back to industry on a silver platter for them to do what they wish,” said Dave Crandall of the Spokane-based Inland Empire Public Lands Council.
The Whitelaw study was cited by U.S. Rep. Sid Yates, D-Ill., during his unsuccessful fight last week to defeat the Taylor amendment.
Timber industry spokesman Ken Kohli of Coeur d’Alene said any study trumpeted by Yates “is tainted to begin with” because the Illinois Democrat has been on an “unending mission” to abolish logging in national forests.
“If we let this stuff decay out in the woods, that will drive the value down,” Kohli said. “The longer the enviros (environmentalists) try to monkey-wrench this process, the lower the value.”
Rep. George Nethercutt, R-Wash., who represents Eastern Washington, took to the House floor last week to praise the logging bill.
Quoting Taylor’s numbers, Nethercutt spokesman Ken Lisaius said logging crowded stands in tinder-dry forests will reduce fire risks while generating income.
“Congress realizes there is an emergency situation out there,” Lisaius said. “It’s sitting on the ground dying and rotting.”
Conservationists originally had an unexpected ally in House Speaker Newt Gingrich, who earlier last week opposed the logging bill as too costly.
But Gingrich changed his mind just before the vote. His staff later said they had mistaken the speaker’s views on the bill.
In a recent interview with Sierra magazine of San Francisco, Gingrich said he opposes below-cost timber sales and expensive road building.
Such subsidies fly in the face of the Republican “Contract With America,” the speaker said.
“Subsidized logging operations as well as subsidized road building at taxpayer expense should cease,” he said. “It’s unfortunate that national forest management yields too often to the local special interest.”