Report: States Would Lose Millions Under Timber Plan Firms Would Pay For Own Logging Roads, While Locals Lose Receipts

States and counties would lose about $11 million in national-forest logging receipts under a Clinton administration plan to make timber companies pay for their own logging roads, according to a report commissioned by the industry.

Environmentalists contend the credits amount to a subsidy, effectively reimbursing timber companies for building the roads they need to log national forests.

That’s disputed in the new report from Price Waterhouse, which was hired by the American Forest and Paper Association to analyze an administration proposal to eliminate Forest Service road credits beginning Oct. 1.

“Economic analysis shows that the forest roads program does not contain a subsidy for timber purchasers,” says the report presented Tuesday to the House Agriculture subcommittee on forestry, resource conservation and research.

“It provides an efficient and effective mechanism for financing road construction and reconstruction. Net timber-sale receipts to the government will be the same with or without a forest roads program,” the report says.

The credits can be used to bid on future timber sales.

“For years, self-described and misinformed opponents of ‘corporate pork’ have targeted timber road credits,” said Rep. Bob Smith, R-Ore., chairman of the House Agriculture Committee.

“Now, we have an independent, unbiased study, by a nationally known, highly respected accounting firm, concluding that timber road credits are not a subsidy,” he said.

The $11 million may not seem like much, Smith said.

“But in rural counties that have already seen dramatic reductions in county budgets, the $150,000 or $200,000 this might mean to their budget could be the difference between retaining and eliminating a critical public school program.”

Environmentalists said the report ignores the damage caused by road-building, road-maintenance costs and the costs of eventual restoration of fish and wildlife habitat destroyed by road-building.

“Road construction is one of the most environmentally destructive activities to our forests and streams,” said Steve Holmer, campaign coordinator for the Western Ancient Forest Campaign.

“It doesn’t make any sense to keep building new logging roads given the fact that we can’t maintain the current 380,000-mile system,” he said.

Forest Service officials had not seen the report and had no immediate comment, agency spokesman Alan Polk said.

In February, the White House Council of Economic Advisers’ annual report concluded that the Forest Service spent $234 million more than it made logging U.S. national forests in 1995, partly because of money spent on logging roads.

Agriculture Undersecretary James Lyons has said he expects elimination of the road credits would result in lower bids for national-forest timber sales as logging companies adjust to cover road-building costs.