U.S. GOVERNMENT PRINTING OFFICE

59–858 u WASHINGTON : 1999

H.R. 2389, COUNTY SCHOOLS REVITALIZATION

ACT OF 1999 AND H.R. 1185, TIMBER-DEPENDENT COUNTIES STABILIZATION ACT

HEARING

BEFORE THE

SUBCOMMITTEE ON FORESTS AND FOREST HEALTH

OF THE

COMMITTEE ON RESOURCES

HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

FIRST SESSION

JULY 13, 1999, WASHINGTON, DC

Serial No. 106–45

Printed for the use of the Committee on Resources

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house

or

Committee address: http://www.house.gov/resources

(II)

COMMITTEE ON RESOURCES

DON YOUNG, Alaska, Chairman

W.J. (BILLY) TAUZIN, Louisiana

JAMES V. HANSEN, Utah

JIM SAXTON, New Jersey

ELTON GALLEGLY, California

JOHN J. DUNCAN, JR., Tennessee

JOEL HEFLEY, Colorado

JOHN T. DOOLITTLE, California

WAYNE T. GILCHREST, Maryland

KEN CALVERT, California

RICHARD W. POMBO, California

BARBARA CUBIN, Wyoming

HELEN CHENOWETH-HAGE, Idaho

GEORGE P. RADANOVICH, California

WALTER B. JONES, JR., North Carolina

WILLIAM M. (MAC) THORNBERRY, Texas

CHRIS CANNON, Utah

KEVIN BRADY, Texas

JOHN PETERSON, Pennsylvania

RICK HILL, Montana

BOB SCHAFFER, Colorado

JIM GIBBONS, Nevada

MARK E. SOUDER, Indiana

GREG WALDEN, Oregon

DON SHERWOOD, Pennsylvania

ROBIN HAYES, North Carolina

MIKE SIMPSON, Idaho

THOMAS G. TANCREDO, Colorado

GEORGE MILLER, California

NICK J. RAHALL II, West Virginia

BRUCE F. VENTO, Minnesota

DALE E. KILDEE, Michigan

PETER A. DEFAZIO, Oregon

ENI F.H. FALEOMAVAEGA, American

Samoa

NEIL ABERCROMBIE, Hawaii

SOLOMON P. ORTIZ, Texas

OWEN B. PICKETT, Virginia

FRANK PALLONE, JR., New Jersey

CALVIN M. DOOLEY, California

CARLOS A. ROMERO-BARCELO ́ , Puerto

Rico

ROBERT A. UNDERWOOD, Guam

PATRICK J. KENNEDY, Rhode Island

ADAM SMITH, Washington

WILLIAM D. DELAHUNT, Massachusetts

CHRIS JOHN, Louisiana

DONNA CHRISTIAN-CHRISTENSEN, Virgin

Islands

RON KIND, Wisconsin

JAY INSLEE, Washington

GRACE F. NAPOLITANO, California

TOM UDALL, New Mexico

MARK UDALL, Colorado

JOSEPH CROWLEY, New York

RUSH D. HOLT, New Jersey

LLOYD A. JONES, Chief of Staff

ELIZABETH MEGGINSON, Chief Counsel

CHRISTINE KENNEDY, Chief Clerk/Administrator

JOHN LAWRENCE, Democratic Staff Director

SUBCOMMITTEE ON FORESTS AND FOREST HEALTH

HELEN CHENOWETH-HAGE, Idaho, Chairman

JOHN J. DUNCAN, JR., Tennessee

JOHN T. DOOLITTLE, California

WAYNE T. GILCHREST, Maryland

JOHN PETERSON, Pennsylvania

RICK HILL, Montana

BOB SCHAFFER, Colorado

DON SHERWOOD, Pennsylvania

ROBIN HAYES, North Carolina

ADAM SMITH, Washington

DALE E. KILDEE, Michigan

OWEN B. PICKETT, Virginia

RON KIND, Wisconsin

GRACE F. NAPOLITANO, California

TOM UDALL, New Mexico

MARK UDALL, Colorado

JOSEPH CROWLEY, New York

DOUG CRANDALL, Staff Director

ANNE HEISSENBUTTEL, Legislative Staff

JEFF PETRICH, Minority Chief Counsel

(III)

C O N T E N T S

Page

Hearing held July 13, 1999 ..................................................................................... 1

Statements of Members:

Boyd, Hon. Allen, a Representative in Congress from the State of Florida 29

Prepared statement of ............................................................................... 31

Hill, Hon. Rick, a Representative in Congress from the State of Montana . 28

Prepared statement of ............................................................................... 28

Statements of witnesses:

Dennison, William N., Supervisor, District 3, Plumas County, California .. 113

Prepared statement of ............................................................................... 125

Dombeck, Mike, Chief of the U.S. Forest Service .......................................... 49

Prepared statement of ............................................................................... 52

Douglas, Robert E., Tehema County Superintendent of Schools, Red Bluff,

California ....................................................................................................... 55

Prepared statement of ............................................................................... 56

Green, Bobby, Chairman, Lane County Board of Commissioners, Eugene,

Oregon ............................................................................................................ 103

Prepared statement of ............................................................................... 108

Spain, Glen, Pacific Coast Federation of Fisherman’s Associations ............ 69

Prepared statement of ............................................................................... 71

Additional material supplied:

Text of H.R. 1185 .............................................................................................. 2

Text of H.R. 2389 .............................................................................................. 9

(1)

HEARING ON H.R. 2389, COUNTY SCHOOLS REVITALIZATION ACT OF 1999 AND H.R. 1185,

TIMBER-DEPENDENT COUNTIES STABILIZATION ACT

TUESDAY, JULY 13, 1999

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON FORESTS,

AND FOREST HEALTH,

COMMITTEE ON RESOURCES,

Washington, DC.

The Subcommittee met, pursuant to call, at 2 p.m. in Room 1334,

Longworth House Office Building, Hon. Rick Hill presiding.

Mr. HILL. [presiding] The Subcommittee on Forest and Forest

Health will come to order. The Subcommittee is meeting today to

hear testimony on H.R. 1185, the Timber-Dependent Counties Stabilization Act, and H.R. 2389, the County Schools Revitalization

Act of 1999.

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Mr. HILL. Under rule 4G of the Committee rules, any oral opening statements at the hearing are limited to the chairman or Ranking Minority Member which will allow us to hear from the witnesses sooner and allow Members to keep their schedules. Therefore, if any other Members have statements, they can be included

in the hearing record under unanimous consent.

STATEMENT OF HON. RICK HILL, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF MONTANA

Since 1908, counties and school systems adjacent to the national

forests have received 25 percent of the gross receipts from the management of these lands. These payments were established to compensate communities for the lack of taxes that would have otherwise been generated had the lands been in private ownership.

A similar program compensates counties by 50 percent of the

gross receipts from the BLM managed O&C lands. The bulk of the

funds for these two programs came from the sale of Federal timber.

As the volume of timber sales began to fall on national forest and

BLM lands in the late 1980s, so did the amount of these payments,

leaving many rural communities in severe economic straits. What

is at stake now is the education and welfare of our children.

One approach, offered by Representative DeFazio, H.R. 1185, and

comparable to the administration proposal would lead to the decoupling of payments from receipts. The other approach, H.R. 2389,

maintains a linkage between payments and economic activities,

recognizing the importance of jobs to local communities.

This second approach was developed by a remarkable grassroots

coalition of over 500 organizations in 32 States, called the National

Forest Counties and Schools Coalition. Based on a set of principles

established by this group, our colleagues, Mr. Allen Boyd of Florida, and Nathan Deal of Georgia, developed legislation that would

create a safety net of payments to counties in the short term and

at the same time create a committee to develop long-term solutions.

[The prepared statement of Mr. Hill follows:]

STATEMENT OF HON. RICK HILL, A REPRESENTATIVE IN CONGRESS FROM THE STATE

OF MONTANA

Today’s hearing will examine two different legislative approaches to resolving the

issue of payments to county schools.

Since 1908, counties and school systems adjacent to national forests have received

25 percent of the gross receipts from the management of these lands. These payments were established to compensate communities for the lack of taxes that would

have otherwise been generated had the lands been in private ownership. A similar

program compensates counties by 50 percent of the gross receipts from BLM managed O&C lands. The bulk of the funds for these two programs came from the sale

of Federal timber. As the volume of timber sales began to fall on national forest and

BLM lands in the late 1980’s, so did the amount of these payments, leaving many

rural communities in severe economic straits. What’s at stake now is the education

and welfare of our children.

One approach, offered by Rep. DeFazio, H.R. 1185, and comparable to the Administration proposal would lead to the ‘‘decoupling’’ of payments from receipts. The

other approach, H.R. 2389, maintains a linkage between payments and economic activities, recognizing the importance of jobs to local communities. This second approach was developed by a remarkable grassroots coalition of over 500 organizations

in 32 states, called The National Forest Counties and Schools Coalition. Based on

a set of principles established by this group, our colleagues, Mr. Allen Boyd of Florida and Nathan Deal of Georgia, developed legislation that would create a safety

net of payments to counties in the short-term and at the same time create a committee to develop long-term solutions.

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To present his bipartisan bill I would like to first introduce Allen Boyd for his

testimony on H.R. 2389. I would also like to thank both he and Mr. Deal for all

their hard work with the National Forest Counties and Schools Coalition in formulating this consensus legislation.

Mr. HILL. To present his bipartisan bill, I would like to first introduce Allen Boyd for his testimony on H.R. 2389. I would also

like to thank both he and Mr. Deal for all their hard work with

the National Forest Counties and Schools Coalition in formulating

this consensus legislation.

Mr. HILL. The Chairman would now recognize the Ranking Minority Member for any statement he might have.

Mr. SMITH. I will save my comments for questions to witnesses.

Mr. HILL. We will introduce Mr. Allen Boyd from Florida. You

are recognized.

STATEMENT OF HON. ALLEN BOYD, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF FLORIDA

Mr. BOYD. Thank you very much, Mr. Chairman and Congressman Smith, Ranking Member. First of all I want to thank you, Mr.

Chairman, and the other members of the Subcommittee for allowing me the privilege of testifying before you about H.R. 2389, the

County Schools Funding Revitalization Act of 1999.

You have a written statement before you, and I want to briefly

summarize that in a short oral statement and then will be glad to

take your questions. The issue of forest revenue payments by the

Federal Government to local affected communities is very important to a large portion of the Second Congressional District of Florida. The Second Congressional District is a very rural district

which encompasses 19 counties and two national forests, the Apalachicola and the Osceola in the Florida panhandle. In fact, I have

been working on this issue since the time I served in the Florida

state legislature. I hope that this hearing will serve as a springboard for Congress to finally address and solve these issues that

adversely effect so many communities across this Nation.

As you stated, Mr. Chairman, in 1908 the Federal Government

entered into a compact with rural forest communities in which the

government was the dominant landowner. Under this compact,

counties received 25 percent of the revenues generated from Federal forest lands to compensate them for a diminished tax base. By

law, these revenues financed public schools and local road infrastructure. However, in recent years, the principal source of these

revenues, Federal timber sales, has been sharply curtailed due to

changes in Federal forest management policy, and those revenues,

shared with States and counties have declined significantly.

If you would look at Exhibit 1 which is before you here, perhaps

the most significant thing about these changes in policy is not the

decline in harvest but rather the fact that in 1998, the net annual

growth of timber in the Apalachicola National Forest was about

800 percent greater than the volume harvested. And the sawtimber

growth is approximately 50 times greater than the volume harvested. I will say again, the annual growth in the Apalachicola National Forest total volume is 8 times that which was harvested and

the sawtimber was 50 times that which was harvested.

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As we know, payments to many counties have dropped to less

than 10 percent of their historic levels under this compact, and this

impact on rural communities and schools has been staggering.

If you look at the next exhibit, Exhibit 2, the returns to the four

counties of the Apalachicola National Forest dropped 89 percent.

This decline in sheer revenues has severely impacted or crippled

educational funding, the quality of education provided, and the

services offered in those affected counties.

Since my time is limited, I will not detail all of the various painful cuts incurred by our counties and schools, but I hope that you

will read the written testimony which is more specific in this area.

I do want to outline two very specific areas that have happened

in Liberty County, Florida, which is the county that contains more

of the Apalachicola National Forest than any other.

First, let us talk about a county obligation and that is the county

emergency response organization. Liberty County in Florida is the

only county that does not have an advanced life support system for

its county emergency response organization. That is a basic when

you talk about rural counties where hospitals in many cases are a

hundred miles away. We don’t have an advanced life support system in that county for its citizens.

The second area and probably the most far reaching and devastating impact is the adverse effect on the future of our children.

When I was in the legislature in the late eighties, we established

in the State of Florida a prekindergarten program which we considered as a very critical part of dealing with some of the problems

that we had in our schools. That has been an enormous success in

the State of Florida.

That program actually was a mandatory program in Florida. In

the last couple of years as we have done what we call accountability decentralization of our educational system, we have allowed

the local governments to make decisions about those kinds of programs. In Liberty County, which was the first county in the State

to enroll all of its eligible pre-K students, the school system in the

last 3 years has totally eliminated that program. It is really sad.

An education system crippled by such severe funding cuts cannot

train the young people in the skills needed to join tomorrow’s society as contributing, productive, and tax-paying citizens.

It is very clear to me that the compact of 1908 is broken and

needs to be fixed immediately. That is why I, along with my colleague, Nathan Deal, have introduced the County Schools Funding

Revitalization Act of 1999. This legislation is based on principles

that were part of a compromise agreement reached by the National

Forest Counties and Schools Coalition. It was not developed by a

Washington knows best top-down approach, but rather through a

bottom-up approach that has finally reached a consensus. This coalition includes over 500 groups from approximately 32 States, including school superintendents, county commissioners, educators,

the National Education Association, and the U.S. Chamber of Commerce.

This bill contains two provisions. First, it would restore stability

to the 25 percent payment of the compact by ensuring a predictable

payment level to the Federal forest communities for an interim 5-

year period. This payment program would be based on the average

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of the three highest payments received by a State in fiscal years

from 1985 until the time this bill is enacted. This is obviously a

necessary step to arrest the current destructive downward spiral.

Secondly, the bill requires the Federal Government to collaborate

with the local communities and school representatives as part of

the Forest Counties Payment Committee to develop a permanent

solution that will fix the 1908 compact for the long term.

In closing, Mr. Chairman, the Federal Government must fulfill

the promise made to these communities in 1908. Together we can

fix the compact and restore long-term stability to our rural schools

and government and the families that depend on them.

Mr. Chairman, I thank you for the opportunity to come before

you and am prepared to answer any questions you might have.

[The prepared statement of Mr. Boyd follows:]

STATEMENT OF HON. ALLEN BOYD, A REPRESENTATIVE IN CONGRESS FROM THE STATE

OF FLORIDA

Madam Chairman, first of all, I want to thank you and the other members of this

Subcommittee for allowing me the privilege of testifying before you about H.R. 2389,

the County Schools Funding Revitalization Act of 1999. The issue of forest revenue

payments by the Federal Government to local affected communities is very important to a large portion of my Congressional district, which is a very rural district

that encompasses 19 counties in the Florida panhandle. In fact, I have been working

on this issue since the time I was serving in the Florida State Legislature. I hope

this hearing is the springboard to having Congress finally address and solve this

issue that affects communities in so many adverse ways.

The Second Congressional District, which I have the honor of representing in the

House, is located in the panhandle of the state, running from Panama City in the

west to the middle of the Osceola National Forest in the east. It has the entire Apalachicola National Forest within its borders and also encompasses part of the Osceola National Forest. The district has over 760,000 acres of national forestland.

Background

In 1908, the Federal Government recognized that counties with Federal lands

were at an economic disadvantage since the Federal Government was the dominant

landowner in many of these communities and therefore these counties were powerless to tax these lands. Recognizing this, Congress entered into a compact with rural

forest communities in which 25 percent of the revenues from National Forests would

be paid to the states for impacted counties in compensation for their diminished

local property tax base. By law, these revenues finance rural public schools and local

road infrastructure. As one can imagine, these counties relied heavily on this revenue for education and infrastructure.

However, in recent years, the principal source of these revenues, Federal timber

sales, has been sharply curtailed due to changes in Federal forest management policy, and those revenues shared with states and counties have declined precipitously.

Payments to many counties have dropped to less than 10 percent of their historic

levels under this compact. This impact on rural communities and schools has been

staggering. The decline in shared revenues has severely impacted or crippled educational funding, and the quality of education provided, in the affected counties.

Many schools have been forced to lay off teachers, bus drivers, nurses, and other

employees; postpone badly needed building repairs and other capital expenditures;

eliminate lunch programs; and curtail extracurricular activities.

Rural communities have also suffered from severe economic downturns causing

high unemployment, domestic violence, substance abuse, and family dislocation.

They are finding it difficult to recruit new business and to meet the demands of

health and social issues associated with the displacement and unemployment. Finally, local county budgets have also been badly strained that communities have

been forced to cut funding for social programs and local infrastructure to offset lost

25 percent payment revenues.

In 1993, the Congress enacted a law which provided an alternative annual safety

net payment system for 72 counties in the northwest region of the country, where

Federal timber sales had been restricted or prohibited to protect the northern spotted owl. This authority for the 1993 safety net program will expire in 2003. No comparable protection has been provided for the other 730 counties across the national

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which receive forest payments. An equitable system of payments for all forest counties nationwide is needed to protect the ability of these counties to provide quality

schools and roads and to allow the Federal Government to uphold its part of the

compact.

A Case Study

As members, we have all heard about, and many of us actually have, counties

that have been adversely impacted by this compact being broken. I have several in

my district, but will focus on Liberty County as a example of how the lost revenue

has affected a large portion of this nation and its citizens. This case study shows

the various effects that the loss of timber revenue from the Apalachicola National

Forest has had on the children and citizens of Liberty County.

Liberty County is a rural county with a population of about 7,000 including 1,300

schoolchildren. That is the smallest county population of schoolchildren in the entire

state of Florida. It has a total land area of 525,000 acres, 97 percent of which is

forested, with half of that owned by the U.S. Forest Service within the Apalachicola.

Until recently, the forest was the mainstay of a strong local forest product-based

economy, and through sharing 25 percent of the revenue from timber sales, provided

substantial support for the local schools and government.

In 1989, the Forest Service began to manage its land in a different way, mostly

to protect the habitat for the endangered red-cockaded woodpecker. It is interesting

to note that Liberty County has the only recovered population of this bird in the

world. Perhaps the most significant thing about these changes is not the decline in

harvest, but rather the fact that in 1998 the net annual growth of timber on the

Apalachicola National Forest was about 800 percent greater than the volume harvested. The sawtimber growth is approximately 50 times greater than the volume

harvested.

The effects of timber harvest reduction on forest revenues to the 4 counties and

school districts within the Apalachicola is that the 25 percent payments have declined in value from a 1987-93, 5 year average (in 1998 dollars) of $1,905,000 to

$220,000 in 1998; a loss of 89 percent. Due to this reduction, the Liberty County

School District was forced to take several painful steps. These steps included reducing school staffing by 11 positions out of a total of 151; increasing the average class

size from 23 to 28 students; discontinuing the enrichment programs in health, computer education, and humanities; discontinuing vocational programs in industrial

arts, small engine repair, and electronics (80 percent of the graduates do not attend

college); curtailing the school media center; eliminating certified art and music

teachers from the elementary school staffs; reducing the Pre-K program, formerly

the only program in the state to serve all four-year olds; and terminating a new program in technology acquisition, which would have placed the county on par with

other Florida school districts.

The impacts on county government have also been very significant. The County

road crew was reduced from 23 to 18 positions. This staff reduction, plus equipment

obsolescence and the inability to purchase needed supplies and materials, has resulted in the deterioration of the rural road system. In 1994, the County was forced

to float a $1,780,000 bond issue in order to meet current road needs. It is unclear

how the county will meet its future road responsibilities in the absence of a substantial increase in the 25 percent payments from timber sale receipts. County employees suffered a 10 percent salary cut, which was partially restored following the imposition of a 1 percent local option sales tax and 7 cents per gallon gas tax. Finally,

the Sheriff’s Office and Emergency Medical Service have been forced to curtail hours

and reduce services. As a result of this action, Liberty County remains the only

county in Florida without an advanced life support system as part of the county

emergency response organization.

However, the most far-reaching and devastating impact of these declining revenues is the adverse effect on the future of our children. An education system crippled by such funding cuts cannot train our young people in the skills needed to join

tomorrow’s society as contributing, functioning citizens.

H.R. 2389

It is clear to me that the compact of 1908 is broken and needs to be fixed immediately. That is why I have introduced the County Schools Funding Revitalization

Act of 1999 with my colleague Representative Nathan Deal. This legislation is based

on principles that were part of a compromise agreement reached by the National

Forest Counties & Schools Coalition. This bill is significant because it was developed

not by a ‘‘Washington knows best,’’ top-down approach, but rather through ‘‘a homegrown,’’ bottom-up approach that has finally reached a consensus. This unique coalition includes over 500 groups from approximately 32 states including school superVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00036 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
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intendents (including Hal Summers, School Superintendent of Liberty County, Florida Schools), county commissioners (including the Columbia County, Florida Board

of County Commissioners), educators, several labor groups, the National Education

Association and the U.S. Chamber of Commerce.

H.R. 2389 contains two main provisions. First, it would restore stability to the 25

percent payment compact by ensuring a predictable payment level to Federal forest

communities for an interim 5-year period. This temporary five-year payment program would be based on the average of the three highest payments received by a

state in fiscal years from 1985 until this bill is enacted. This is obviously a necessary step to arrest the current destructive downward spiral. Secondly, the bill requires the Federal Government to collaborate with local community and school representatives as part of the Forest Counties Payment Committee to develop a permanent solution that will fix the 1908 compact for the long term.

There are other options that have been proposed to address this problem, from

decoupling forest receipt payments from forest management activities to legislating

or mandating timber harvest. My view is that the welfare of schools and county governments cannot be artificially disconnected from the economic stability and social

vitality of rural counties. I do not feel that either one of those options is a starter

in this Congress. However, I truly believe that the consensus compromise that H.R.

2389 represents is the one possibility that could be passed.

We, the Federal Government, must fulfill the promise made to these communities

in 1908. In the part of the country where I come from, a man’s word is his bond.

Together, we can fix the compact and restore long-term stability to our rural schools

and governments and the families that depend on them.

Again, thank you for allowing me the opportunity to discuss the issue of forest

timber revenue payments and the solution that Representative Deal and I have developed. I stand ready to try and answer any questions that my colleagues might

have.

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Mr. HILL. I thank you, Mr. Boyd, for your testimony.

Before we proceed, I would like to ask for unanimous consent for

Mr. DeFazio to be able to join us at the dais. Without objection, so

ordered.

I want to remind members that Committee rule 3C imposes a 5-

minute limit on questions, and the Chair will recognize members

for any questions they may have to ask witnesses.

Mr. Sherwood, you are recognized.

Mr. DEFAZIO. Mr. Chairman, is that necessary? I appreciate the

unanimous consent, but is that necessary for a member of the full

Committee. I thought members of the full Committee could sit on

any Subcommittee.

Mr. HILL. That is what we were told by staff.

Mr. DEFAZIO. Thank you, Mr. Chairman.

Mr. SHERWOOD. Thank you.

Mr. Boyd, I am very interested in your first chart that showed

the cut on the Apalachicola National Forest and the growth. I realize that you reemphasize those figures for us, but what is your understanding why we find ourselves in that position where growth

is 800 times harvest; if I understood you right?

Mr. BOYD. Well, that is a very good question, an appropriate

question. I think you need to understand a little bit about the history of the Apalachicola National Forest. The forest was purchased

by the Federal Government probably back in the 1930s. It was actually cut over when the Federal Government purchased it, and the

United States Forest Service and the government has done a great

job in reestablishing the forest. I know Mr. Dombeck is here and

can give us more of the specific dates.

But what has happened over the last few years is there is the

red-cockaded woodpecker population in the Apalachicola National

Forest, and I might say that we have the only recovered population

of RCW in the world and probably the largest population in one

spot of RCW anywhere in the world.

The point that I would make is that this RCW population has actually thrived over the years with the cutting practices that we

were using back in the eighties; but somehow or another the Forest

Service policy changed in the early 1990s and our cutting has gone

to almost zero. As a result, our county and schools don’t get any

revenue off of it. I hope that answers your question.

Mr. SHERWOOD. Where did you get your timber volume figures?

Mr. BOYD. They came from the Southeast Forest Experiment

Station Resource Bulletin.

Mr. SHERWOOD. When did the policy change? It looks like it

maybe is 1991 or 1992?

Mr. BOYD. You can see the graph shows after 1989, you started

a downward decline that hit rock bottom in 1995. You actually

see—the sawtimber volume is indicated by the dark portion of each

bar. The pulptimber, that is the total cutting on each—the total

cutting for the forest.

Mr. SHERWOOD. What is the rotation, pulpwood, you need about

35 years?

Mr. BOYD. We need much less. We can cut out pulpwood in those

areas of Florida, if you cut on a 25 to 30 year rotation, you actually

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get a good amount of saw timber. We understand that we have

some other objectives in the national forest.

Mr. SHERWOOD. We are so used to talking about western forests

in this Committee where it is dry, and timber does not grow that

fast.

Mr. BOYD. That is not the case here.

Mr. SHERWOOD. That is what I wanted to establish. I will reserve

the rest of my questions until after the chief talks to us.

Mr. HILL. I thank the gentleman, and the Chair recognizes Mr.

Smith.

Mr. SMITH. One question on the decoupling issue. Can you explain where you are coming from on that? Obviously the one side

of the argument is since timber harvest has been so unpredictable

in recent years that tying a significant portion of the local community’s budget to that is a questionable policy, even though the original policy of making sure that they were compensated for the fact

that this land was put in Federal hands is sound and is necessary.

Wouldn’t it make sense to find some more secure and stable

amount of funding to make up for that instead of having it tied in

to the timber sales, which as I understand it, you built some things

along the lines of stability but doesn’t go to full decoupling.

Mr. BOYD. I think that is correct. The reason that the coalition

did not come up with a recommendation to go to decoupling is that

the administration has made that recommendation for 2 or 3 years

in a row and I don’t know that a bill has ever been introduced, certainly I don’t believe one has ever had a hearing and moved. Mr.

DeFazio can speak greater to that than I can because I think he

has a piece of legislation which basically does that.

But our goal here was to stabilize the situation for the 5-year

term, put in place this advisory committee which would be made

up of seven people as a cross-section of the interested parties here

and have them make a recommendation back to Congress as to

how we fix this long term.

Mr. SMITH. Thank you.

Mr. HILL. The Chair would recognize Mr. DeFazio.

Mr. DEFAZIO. Thank you, Mr. Chairman.

In clarification, the administration has proposed this as I understand it twice now. This is the second budget cycle in which they

have proposed it.

My bill, just to correct the record, both the staff memo and the

gentleman’s perception, gives a one-time option 5 years out which

is after the next regularly scheduled forest planning process at

which point I think we would have a good handle on what future

harvests might or might not yield and whether counties and

schools would be better linking themselves to revenue sharing or

to guaranteed payment.

But my question goes to the issue of where the money comes

from under the gentleman’s bill. It appears to me that the money

if it is not adequate in—is going to come out of the Forest Service

appropriations, is that where some of the money might come from?

Mr. BOYD. Congressman DeFazio, what the bill—this bill anticipates is that is a decision that would be made by the Forest Service. There was a 1908 compact made between the Federal GovernVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00049 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
46

ment and the local communities, and the Forest Service had the responsibility for implementing that compact.

The Forest Service has changed its management policy in the

last 6 to 7 years in such a way that the compact has been rendered

essentially useless and so we felt like the Forest Service should

make the decision about those issues, about where the funding

comes from since it was their policy changes that got us there. Of

course we stand ready to work with the Forest Service in any way

that we can to make it happen.

Mr. DEFAZIO. Just to disagree slightly with the gentleman, we

make policy, not the Forest Service. The Forest Service implements

policy. That is a little bit of my frustration with the approach,

which is to say if the agency cannot deliver on higher harvests,

which are precluded by law as established by Congress, then it will

have to come out of their budget, further crippling an agency which

doesn’t have enough money to perform its mission, whether the

mission is to provide benefits to the counties or recreational benefits or other multiple-use benefits. I don’t believe the Forest Service

has enough money.

So I am concerned that it would appear that we are going to penalize the agency which is implementing the policies which we

have established, and this has been my argument with the counties

coalition. If we want to have a debate on forest policy, the Chairman could start that debate tomorrow on legislation to change the

underlying laws and policies that are under the jurisdiction of this

Committee that goes to the level of harvest and mandate high levels of harvest. But instead we are having this sort of back door way

of penalizing the agency which really can’t do—doesn’t have the

flexibility.

In my case, in my region the changes came about because of litigation after the Forest Service had drug its feet for years, and they

were totally wiped out in the courts. The timber harvest went to

zero, and subsequently changes were made that restored some harvest. But I guess the point is maybe it should come out of

Congress’s budget.

Mr. BOYD. I certainly don’t want you to inaccurately characterize

what the legislation does because I think it speaks clearly for itself.

You have been here certainly longer than I have and probably

understand these issues a great deal better than I do because you

have been involved with them. I don’t know of any specific legislation that has come out of this Congress which has mandated, since

1990, reduced cutting. But I am sure as a result of certain policies

that came out, the Forest Service took it upon themselves to

change their management policy and I certainly understand that

part.

That is why we have set up what we think is a reasonable 5-year

temporary fix and put together the advisory committee to help us

develop a long-term solution. The alternative is to bury our heads

in the sand and go along like we have. And in the meantime, we

continue to have these funding problems in our schools and with

our local governments down there.

I want you to know, Mr. DeFazio, I stand ready to work with

anybody. I have been hollering and screaming about this issue for

several years, even before I got into Congress. I don’t know exactly

47

how to answer your question except to say that it is the Forest

Service management policy that has changed over the last few

years that has reduced the revenues to our local governments.

Mr. DEFAZIO. To whom does the committee make the recommendation for changes in policy?

Mr. BOYD. To the U.S. Congress.

Mr. DEFAZIO. That goes back to the point that I made. The

changes in forest policy management do go to a whole host of Federal environmental laws and court precedents that have been set.

And if this Congress wants to mandate higher harvest levels, we

can do that, which means that there are underlying policies that

were created by laws by the Congress that have driven the management by the Forest Service.

I mean, yes, there is a little bit of wiggle room, but under the

last administration that wanted to harvest a lot more timber in the

Pacific northwest than the law apparently allows, the courts just

enjoined them. I think you might find in your forest if they try to

ignore the red-cockaded woodpecker or other mutiple-use concerns

and endangered species concerns, whatever your concerns are in

your forest, you might end up under an injunction that wipes out

that whole little bar that you have left there. I am not sure that

we are—I agree on your basic premise. And the hurt and pain, I

have seen it. The amount of timber that you harvested at the maximum was the amount of timber harvested in the smallest ranger

districts in my region, and so I understand the pain. I am sympathetic, but I want to keep my eye on the ball and that is the

money.

Mr. BOYD. If I might because when Mr. DeFazio asked the last

question, he asked it in such a way maybe I didn’t answer it correctly. You said who the advisory committee makes the recommendations to about the policy changes. We are not—we don’t

ask the advisory committee to make recommendations about policy

changes. We ask them to make recommendations about how to

solve this problem. I want to make that very clear. I can see if you

thought that the advisory committee was going to be advising the

Forest Service about how to do its cutting, that is not what we

asked them to do. We are asking them to make recommendations

to the U.S. Congress about how to solve this problem so that the

Federal Government can keep its compact with the local communities that it established in 1908.

Mr. HILL. I thank the gentleman. Carrying on with that same

topic, we can’t pass a decoupling bill or targeted timber harvest bill

in this Congress. This is an effort to compromise those two positions and come up with something that we can move forward with.

Mr. BOYD. You said it better than I could, Mr. Chairman.

Mr. HILL. Thank you very much.

The issue here is bigger than just the funding of schools and

counties. One of our goals here is stable economies and stable communities. Isn’t that one of the objectives of this bill?

Mr. BOYD. That is correct. I didn’t talk about that because there

are several impacts on local communities. One is on your school

system and another is on your local county government and both

of those have to do with tax issues. The third impact is on the economy and many of these communities rely heavily on the forest or

48

timber industry as the backbone of their economy, which has been

ripped away from them. We are not sure that we will solve all of

those questions over the years, but at least we ought to make an

effort as to how we can help solve this funding problem with the

school systems and local governments.

Mr. HILL. And this is consensus legislation. It is bipartisan and

a broad spectrum of different groups that are supporting it; isn’t

that correct?

Mr. BOYD. That is correct. You have people all of the way from

the National Educational Association to the U.S. Chamber of Commerce and labor groups. I think that is about as much consensus

as you can get.

Mr. HILL. Are you aware of any coalition that is supporting Mr.

DeFazio’s bill or the administration’s proposal with regard to decoupling?

Mr. BOYD. I am not. That does not mean that there is not somebody out there supporting it, it just means that I am not aware of

it.

Mr. HILL. Let’s go back to the issue of decoupling. I happen to

agree with your feelings about decoupling. I have a couple of examples, more than a few examples, where there are decoupled payments from the Federal Government. The most common is Indian

reservations where we have impact aid and other payments. The

point is that they don’t have sustained economies. They don’t have

stable economies. Would you just address this issue of decoupling;

why decoupling is a mistake in your view?

Mr. BOYD. Well, I believe there is always a chance, particularly

in some of the things that we have seen happen in the U.S. Congress in the last few years, that if the issue becomes decoupled,

then it becomes an easy appropriation to just let go away eventually. So that is one of the reasons.

The other reason is because even though the administration has

proposed it now for two budget cycles, it has not caught on with

anybody. We were looking for something that might be able to give

us a short-term fix again and establish a committee that will make

some long-term recommendations on solutions.

Mr. HILL. One last question. If there is one important point that

you want this Subcommittee to keep in mind, what is it do you

think that the Subcommittee should remember from this hearing?

Mr. BOYD. I think that in Liberty County, Apalachicola National

Forest, in the mid-eighties, this school system got almost $2 million

out of this program which was a very important, significant part

of its funding for children. And that was in exchange for the Federal Government owning land and diminishing the tax base which

would be the normal revenue base for the schooling.

Now that has gone to 10 percent of that number, and our class

sizes have increased from 23 up to 28. We have had to lay off

teachers and bus drivers. We have obsolete equipment. We have

done away with our pre-K program. Those are significant issues. It

is affecting the education of our children in that community.

Mr. HILL. I thank you very much, and I thank you for your excellent testimony. If there are no other questions, you are excused.

Mr. BOYD. Thank you, Mr. Chairman, and Members.

49

Mr. HILL. I would like to introduce our next panel, Mr. Mike

Dombeck, Chief of the U.S. Forest Service; Mr. Bob Douglas,

Tehema County Superintendent of Schools, Red Bluff, California;

Mr. Glen Spain, Pacific Coast Federation of Fisherman’s Associations; Mr. Bobby Green, Chairman, Lane County Board of Commissioners, Eugene, Oregon; and Mr. William N. Dennison, Plumas

County Supervisor, District 3, Chester, California.

The Chairman will recognize Mr. Dombeck.

STATEMENT OF MIKE DOMBECK, CHIEF OF THE U.S. FOREST

SERVICE

Mr. DOMBECK. Thank you, Mr. Chairman. It is always an honor

to appear before this Committee, and today our topic is to testify

on the Timber-Dependent Counties Stabilization Act of 1999 and

the County Schools Funding Revitalization Act of 1999 and to discuss the Department’s proposal on this same topic, and I would like

to introduce Associate Deputy Chief Sandra Key who is here with

me as a technical expert and knows all of the numbers.

I will talk about the Department’s proposal first. As you are

aware, the proposal which we have submitted for a second year

really focuses on a number of things. Number one, to provide stability and predictability to counties. I think I am struck when I

heard just the statements of Congressman Boyd and the questions

of how much—how many common goals we have in this effort. Predictability and stability are those, and the fact is that social services and schools, roads are very important. And I am one that grew

up on a national forest and attended one of those schools in one

of those districts, so I am somewhat familiar with it.

Our second objective is to provide reasonable payments to compensate counties for national forest lands that are not available for

the local tax base.

A third objective is mandatory permanent payments not subject

to annual appropriation, not subject to the unpredictability that

county commissioners and others deal with; and perhaps the last

issue that there is some concern over, and that is the connection

between controversial timber sales to critically important local

services and how we can avoid some of the instability from litigation injunctions and things like that that are really out of the control of the Congress and the Forest Service.

Let’s talk about the stability issue first. I have a graph that really points out the trends.

[The information follows:]

50

51

Mr. DOMBECK. As we move to the right, what we see is a 36 percent reduction from 1989 to the present. And if the safety net had

not been put into place for the O&C counties and the west side

counties in Oregon, the slope of that curve would be even significantly further down from where it is right there. As you see, our

projections of where payments to counties, where we would predict

that they would go based on the information that we have are also

listed there and then the squares across the top indicate some sort

of stability that our proposal provides, and we think that is a real

important objective.

Secondly, I just want to reaffirm the commitment of the Forest

Service to providing some level of payment to the counties understanding that in many cases there are large portions of the tax

base that are not available because of the national forest lands that

are there. The children of the Forest Service employees go to these

same schools, use the same roads as other residents in those communities. The concern about the unpredictability of the appropriations process, to fund to the authorized levels, I know are concerns

here; and that is why we feel some sort of mandatory payment is

important. We have a permanent mandatory appropriation now on

the 25 percent fund, so really what we are looking at there is no

change to make this a permanent fund because it is already a permanent fund. It is already mandatory.

Lastly, the distinction between a social services, a moral imperative for our children’s education, do we really want to tie that to

controversial issues like timber sales where we know the controversies are looming, and how can we move away from that. It is my

belief that tightening the connection will further inflame the controversy rather than make it easier.

The fact is should education issues be driving national resource

decisions? Wouldn’t they be better dealt with as education issues

and as funding issues rather than mixing the two in an already

fairly complex situation because the fact is that resource management has been controversial since the days of Gifford Pinchot and

will continue to be controversial because of the simple fact that as

our country grows, there is not enough for everyone to have all of

what they want. And so we have to share, and the real debate is

about balance as much as anything else.

With regard to the County Schools Funding Revitalization Act, I

think there is a lot of agreement there. However, we strongly oppose that piece of legislation for a couple of reasons. Number one,

it doesn’t provide long-term stability beyond 5 years.

Secondly, the funding provisions for the payments could create

significant impacts on Forest Service programs like recreation, fish

and wildlife programs because of the provisions there, and it

doesn’t separate payments from controversial issues like timber

sales. And we are also concerned about the establishment of another committee since we already have congressional concerns over

the complexity of legislation and issues that really play into Forest

Service policies.

With regard to Mr. DeFazio’s bill, we see a lot of commonality

there and think that through some amendments we could really

move forward with that. The issue of stability is important. The

issue that I am somewhat concerned about and I am happy to

52

enter into a dialogue on, we know what the problems are today so

why would we wait 5 years to put a decision off. At any rate, I

think it is important that these issues are being discussed here

today, and I am happy to answer any questions you have after the

panel has made its statements.

Mr. HILL. Thank you Chief Dombeck for your testimony.

[The prepared statement of Mr. Dombeck follows:]

STATEMENT OF MIKE DOMBECK, CHIEF, FOREST SERVICE, UNITED STATES

DEPARTMENT OF AGRICULTURE

Thank you for your invitation to testify on H.R. 1185, ‘‘Timber-Dependent Counties Stabilization Act of 1999,’’ and H.R. 2389, ‘‘County Schools Funding Revitalization Act of 1999.’’ I appreciate the opportunity to join you today to continue the dialogue that the Administration began last year on the need to provide a stable, permanent level of payments, commonly known as the twenty-five percent fund, and

to separate the payments from National Forests receipts. With me this afternoon

is Sandra Key, Associate Deputy Chief, Programs and Legislation from the Forest

Service.

As you are aware the Department of Agriculture has also submitted to Congress

proposed legislative language that would make payments to states permanent and

at an increased level over what is forecasted with the twenty-five percent fund payments.

Department’s proposal, ‘‘The Stabilization Act of 1999.’’

The Department’s proposal will:

(1) provide a stable, predictable payment that counties can depend on to help

fund education and maintenance of roads,

(2) provide increased payments above the payments projected under current law

to compensate states for National Forest lands that are not available to the

local tax base,

(3) provide a mandatory, permanent payment not subject to the annual appropriation process, and

(4) sever the connection between timber sales and critically important local

services.

First, we need to provide a stable, predictable payment that counties can depend

on to help fund education and road maintenance. Under 16 U.S.C. 500, (commonly

known as the twenty-five percent fund), twenty-five percent of most Forest Service

receipts are paid to the states for distribution to the counties in which National Forest lands are located for financing public roads and schools. Historically, the primary source of National Forest receipts has been from the sale of timber on National Forests. Over the past 10 years, timber harvest from National Forests has

declined 70 percent in response to new scientific information, changing social values,

and our evolving understanding of how to manage sustainable ecosystems. During

that same period, payments to states made under 16 U.S.C. 500 have been reduced

36 percent; from $361 million in 1989 to $228 million in 1998.

Under the Department’s proposal, states will receive the higher of the 1998 fiscal

year payment or a new special payment amount. The special payment amount will

be 76 percent of the average of the 3 highest payments made to the state during

the 10 year period from fiscal years (FY) 1986 through 1995 of both twenty-five percent fund payments and payments under section 13982 of the Omnibus Budget Reconciliation Act of 1991 The special payment amount will not exceed the 1998 FY

payment by more than 25 percent. The special payment amount will pay the states

approximately $269 million annually, representing an additional $27 million above

the existing baseline in FY 2000, $72 million in FY 2004, and $259 million more

over the next five years.

The special payment is modeled on the formula used in what was referred to as

the ‘‘owl county safety-net’’ adopted by Congress in 1990 as a provision of the Interior and Related Agencies Appropriations Act. The provision was adopted at the request of certain counties in western Washington, Oregon, and northern California

affected by decisions relating to the Northern Spotted Owl. It was renewed annually

until 1993 when Congress authorized a 10 year, gradually declining, payment stabilization formula which will expire in 2003. We chose 76 percent of the historic

baseline because that was the level of the owl county safety-net payment guarantee

when the Administration first proposed to stabilize payments over a year and a half

ago.

53

Second, we want to provide a reasonable payment, based on all benefits of National Forest lands, to compensate states for these lands that are not available to

the local tax base. Historically, states received payments based on revenues generated from commodity extraction, primarily timber. For a variety of reasons, including new scientific information about the sustainability of our resources, commodity extraction from our National Forests has been reduced. National Forests

continue to provide a myriad of benefits to local communities—jobs, income generation, recreation and tourism, timber and mining, hunting and fishing and so on.

Payments made through the payments in lieu of taxes program are often not appropriated to their fully authorized levels, creating difficulties for counties with a limited tax base due the presence of public lands. Our proposal ensures that states continue to benefit from both the intrinsic and economic value of public lands by guaranteeing a payment to make planning and budgeting predictable for counties. Thus,

we propose that states receive a permanent, stable annual payment based upon a

percentage of historic payment averages.

Third, the payment needs to be excluded from the annual appropriation process.

We cannot rely on either revenues or the annual appropriation process to produce

a consistent, reliable level of funding. The Department’s proposal will provide a

mandatory, permanent payment to states from the general fund of the Treasury.

Fourth, we must make distinct and separate the social and moral imperative of

cildren’s education from the manner that public forests are managed. Both activities, children’s education and forest management, are essential but continuing to

link the two activities together could continue to reduce funding for children’s basic

education needs.

There has been resistance to this proposal. In part, the resistance may stem from

a belief that timber harvest levels will rise dramatically again in the future. This

belief is mistaken: (1) timber harvest has steadily declined over the past decade, and

(2) in FY 1999 and FY 2000, the Administration and both Houses of Congress each

proposed as part of the appropriations process timber offer levels that were below

4 billion board feet, including salvage opportunities. It is highly unlikely that timber

harvest levels will return to the 11 billion board feet volume of the early 1990s.

Continuing the connection—or tightening it as one of the two congressional proposals before us today would do—will only serve to ensure that payments to states

will continue to be tied to controversial forest management issues.

Separating payments to states from the receipts generated from the sale of commodities and user fees will allow for a stable, reliable increased level of funding for

the states and counties.

H.R. 1185, ‘‘Timber-Dependent Counties Stabilization Act of 1999’’

The Administration supports the objectives of H.R. 1185, but will seek amendments to more closely align this bill with the Department’s proposal. For FY 2000

through FY 20004, this legislation will provide stable payments to states based on

an amount equal to 76 percent of the average of the 3 highest twenty-five percent

payments made to the state during the 10 year period from fiscal years 1986

through 1995 (special payment amount).

In addition, the bill would provide that after FY 2004 each state will make a one

time permanent, binding choice of receiving either the twenty-five percent payment

or the special payment amount. This will give states the option to have a permanent, stable payment, not based on revenue generation, or to continue with the decreasing, unpredictable twenty-five percent fund payments. While this is definitely

a step in the right direction, it simply puts off decisions which can and should be

made today. The Department prefers to ensure that all states receive a permanent

stable payment as is provided in the Department’s proposal.

This legislation also provides for the special payment amount to be adjusted to

reflect changes in the consumer price index for urban uses. The Department’s proposal does not reflect changes in the consumer price index, but we are willing to

work with the Subcommittee to discuss the additional funding that this will require.

H.R. 2389, ‘‘County Schools Funding Revitalization Act of 1999’’

Again the Department agrees with one of the objectives of H.R. 2389, that is to

stabilize payments, but strongly oppose this bill for the following reasons: (1) it does

not provide a stable payment past 5 years nor does it provide for a mandatory payment to states from the general fund of the Treasury, (2) the funding provisions for

FY 2000-2005 payments could create significant impacts on Forest Service programs

and (3) it does not separate payments to states from the contentious, controversial

debate over natural resource management of the National Forests, but only fuels

this debate by establishing an advisory committee to address issues concerning

management of our National Forests.

54

First, H.R. 2389 would only temporarily stabilize payments to states for a five

year period beginning in FY 2000. Under this bill, the short-term payments for fiscal years 2000 through 2005 would be the twenty-five percent fund payment for the

fiscal year or the full payment amount, whichever is greater. The full payment

amount would be equal to the average of the three highest twenty-five percent fund

payments or the owl county safety-net payment during FY 1986 through FY 1999.

This formula would yield a payment that is over $170 million more than the $269

million that is available for the Department’s proposal. Since current payment levels

equal $227 million for FY 2000, falling harvests would need to double in order to

fund the higher payments to state levels, or the Forest Service will have to significantly reduce non-revenue producing programs. In addition, after 5 years this issue

will have to be addressed again. Assuming this issue will not be easier to resolve,

then payments to states will return to the twenty-five percent fund payments resulting in a significant reduction in funding for education and roads.

Second, under the Department’s proposal, payments to states will be made automatically from the general fund of the Treasury and will not be subject to the annual appropriation process. In contrast, H.R. 2389 will fund the difference between

the twenty-five percent fund payment amount and the full payment amount from

revenues received from activities on National Forest lands and funds appropriated

for the Forest Service. Forest Service appropriations that fund programs generating

revenues for the twenty-five percent fund, and funds from trust funds or other special accounts established by statute for specified uses will not be eligible to fund this

difference. Under this provision, in FY 2000 the Appropriations Committees will

have to either increase Forest Service funding or divert over $170 million from Forest Service programs such as fire suppression, watershed improvement, wilderness,

wildlife and fisheries that do not generate revenue. This is neither tenable nor appropriate.

Third, H.R. 2389 will fail to separate payments to states from the debate over the

management of National Forest lands. In fact, the bill would only fuel this debate

by continuing to make the payment amount dependent on decisions relating to natural resources management. Most significantly, the bill would establish an advisory

committee charged with developing recommendations for a long term method for

generating payments at or above the full payments amount. The advisory committee

will be required to ‘‘seek to maximize the amount of . . . revenues collected from Federal lands’’ and to ‘‘ensure that this method is in accord with a definition of sustainable forest management in which ecological, economic and social factors are accorded equal consideration in the management of the Federal lands.’’

The concept of maximizing revenues collected from National Forests is a fundamental change in Forest Service policy and direction. There is nothing in the Organic Act or National Forest Management Act (NFMA) that requires optimization

of revenues. For the last 30 years, Congress has declined emphasizing economic return over natural resource management needs. To do so now is a major reversal to

long-standing, carefully hammered out policy. NFMA certainly recognizes the important contributions of economic products from the National Forests, but it also recognizes that such production should be within the ecologically sustainable limits that

also preserves our children’s economic future.

We strongly believe that payments to states for the purposes of funding schools

and roads should not be thrust into the middle of the debate over the appropriate

management of our natural resources.

Closing

Since 1908, the twenty-five percent fund has worked well to provide funding for

local schools and roads. But as demands on our National Forests have increased and

timber harvest has declined we need to provide a stable, permanent mechanism for

making payments to states.

Madam Chairman, the Department supports the objectives of H.R. 1185, but we

prefer a complete separation between the payments to states and revenue generation from National Forests. The Department strongly opposes H.R. 2389 because it

neither provides a permanent stable payment to states nor separates payments to

states from the controversial debate over management of our National Forests. We

recommend that you consider our proposal to provide a permanent, predictable payment that states can depend on to help fund schools and roads. We would be

pleased to work with the Subcommittee to pursue options that might meet our respective goals.

This concludes my statement; I would be happy to answer any questions you and

the Members of the Subcommittee might have.

Mr. HILL. Mr. Douglas, you are recognized.

55

STATEMENT OF ROBERT E. DOUGLAS, TEHEMA COUNTY

SUPERINTENDENT OF SCHOOLS, RED BLUFF, CALIFORNIA

Mr. DOUGLAS. Thank you for the opportunity to testify in support

of H.R. 2389. The bill is based upon the National Forest Counties

and Schools Coalition principles, as you mentioned. Our coalition

is a rapidly growing collaborative of 500 organizations from now 35

States. Our office administers the coalition, and I serve as the chief

administrative officer.

Mr. Chairman, I would like to enter into the record a list of the

organizations which support the coalition.

Mr. HILL. Without objection.

Mr. DOUGLAS. Our organization has grown very rapidly since

founded in March 1999, primarily because the citizens of the 800

forest counties in America, all of whom are represented in one way

or another by the organizations in our coalition are having a common experience. As a group these counties are enduring economic

instability as a result of the deep decline in resource-based activities on Federal forest lands, they are experiencing devastating social disruption and decimated public school and county services.

Nationally, U.S. Forest receipts have declined precipitously since

1989. In 70 forest counties which are protected by the Northwest

Forest Plan, the declines have been in the 21 to 24 percent range

to date. However, in the 730 forest counties not protected in the

Northwest Plan, the declines in receipts have ranged from 75 to 90

percent as Congressman Boyd noted.

Public schools and county governments have, out of necessity,

slashed programs and services. Five to ten years of steeply declining receipts have literally eviscerated the breadth and quality of

school and county services in most of these counties.

In an urban or suburban setting, the vast majority of property

is private or industrial, and it is possible to offset these losses in

revenues through a variety of taxes or assessments.

In forest counties where 50 to 96 percent of the land is nontaxable Federal forest land, this possibility simply does not exist.

This fact was recognized by the Congress and the founders of our

Federal Forest System almost a hundred years ago when huge

blocks of land were set aside to form our national forest reserves.

When we removed those lands from private ownership, revenue

production and local tax generation, the counties of America protested the impact on public service support. Gifford Pinchot, Congress, and the President agreed that 25 percent of the annual revenue from management of those lands would be given to schools

and counties as mitigation for the effects of land removal.

This was a compact with the people of rural counties. These

funds have been for almost a hundred years a mainstay of support

for forest counties and schools. We honored that compact until the

late 1980s when by agency policy, administration regulation and

injunction, the active management of our forest system was severely restricted. The historic compact with the people of forest

counties has been broken and disregarded for almost a decade.

For these reasons, we propose H.R. 2389 which is a two-phased

resolution to revitalize county and school support. It proposes a

short-term safety net for forest counties designed to protect public

schools and county services over the next 5 years. Given the ecoVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00059 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
56

nomic and social deterioration in these counties, it is absolutely essential that we revitalize and stabilize their infrastructures.

Second, in order to address the larger and more significant systemic problem, which includes not just school and county government support but also the economic and social health of our communities and the health and sustained multiple use of our Federal

forest lands, we are proposing the creation of a national committee

appointed by Congress to develop recommended legislation and/or

policy revisions, a focused national conversation over the next 5

years devoted to defining a long-term solution to our Federal forest

management practices. And the resultant effects upon long-term

sustainable health, community and social stability, and the vitality

and effectiveness of school and county infrastructures is critically

needed in our country. In the meantime, the current laws regarding the payments to States should remain untouched.

Our bill provides such a mechanism. This is a systemic problem,

and it must be solved with a systemic solution. We believe that the

Forest Service and the Bureau of Land Management must continue

to have incentives to actively manage Federal forests for the production of materials for our Nation to generate resources for the

Treasury and payments to counties and schools and also be diligent

about the active healthy management of our national forests.

We strongly believe that payments to counties and schools

unconnected from corollary improvement in economic self-determination and improved social conditions will not work. Neither will

payments to counties work, which are unconnected to incentives to

actively manage, on a sustained basis, the dominant economic asset

in forest counties, the forest land itself.

All of these factors are connected parts of an ecological and social

system and any long-term solution must achieve a balance between

these factors. Forest Counties and Schools Coalition urges your

support of H.R. 2389. It meets the immediate and critical needs of

forest counties and schools while providing a blueprint for the construction of a long-term solution to our current forest management

gridlock and its attendant consequences.

Thank you very much, Mr. Chairman.

Mr. HILL. I thank you, Mr. Douglas.

[The prepared statement of Mr. Douglas follows:]

STATEMENT OF BOB DOUGLAS, NATIONAL FOREST COUNTIES AND SCHOOLS COALITION

Thank you for the opportunity to provide testimony in support of H.R. 2389. This

bill is based upon and reflects the principles upon which the National Forest Counties and Schools Coalition is based (see Appendix A). The National Forest Counties

and Schools Coalition is a rapidly growing collaborative of over 500 organizations

from 32 states. My office currently administers the Coalition and I serve as the

Chief Administrative Officer.

Mr. Chairman, I would like to enter into the record, a list of those organizations

which support the National Forest Counties and Schools Coalition Principles and

this legislation. Our organization has grown very rapidly since it was founded in

March 1999. This is primarily due to the fact that the citizens in our eight hundred

(800) forest counties in America, all of whom are represented by organizations in

our Coalition, are having a common experience. As forest related communities, they

are all enduring economic instability as a result of the precipitous decline in resource based activities on Federal forest lands, devastating social disruption, and

decimated public school and county services.

Nationally, U.S. Forest Reserve receipts have declined by 65 percent since 1989,

(See Appendix B). In the seventy (70) forest counties which are protected by the

Northwest Forest Plan, the declines have been approximately 21 percent to date.

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However, in our 730 forest counties not protected in the Northwest Plan, the declines in receipts have ranged from 75-90 percent (See Appendix C).

Public schools and county governments have, out of necessity, slashed programs

and services. Five to ten years of steeply declining receipts have literally eviscerated

the breadth and quality of school and county services in most of these counties.

In an urban or suburban setting, wherein, the vast majority of property is private

or industrial, it is possible to raise offsetting revenues through a variety of local

taxes and/or assessments. In forest counties where 50-96 percent of the land is nontaxable Federal forest land, this possibility simply does not exist. Given the exceptionally small non-Federal land base, it is impossible to locally offset the loss of Forest Reserve or O & C BLM receipts.

This fact was recognized by the Congress and the Founders of our Federal forest

system. Almost one hundred years ago when our National Forest system was

formed, huge blocks of land were set aside to be Federal Forest Reserves. These

lands were removed from the possibility of private ownership, revenue production,

and local tax generation for county government and schools. Not surprising, there

was a hue and cry from forest counties nationwide about the local economic impact.

Gifford Pinchot, Congress, and the President agreed that 25 percent of the annual

revenue from the management of these Federal forest lands would be given to

schools and counties as mitigation for the effects of this land removal.

This was a ‘‘Compact With The People of Our Rural Forest Counties.’’ These funds

have been, for almost 100 years, a mainstay of support for rural schools and counties. The Compact was honored and protected until the late 1980’s, when by Federal

agency policy, administrative regulation, and injunction, the active management of

our National Forest System was severely restricted. During the last decade, this historic Compact with the People of our forest counties has been broken and disregarded.

For these reasons, H.R. 2389 proposes a two-phase solution to revitalize county

and school support. First, it proposes a short-term safety-net for our forest counties

designed to protect public schools and county services over the next five years.

Given the economic and social deterioration in these counties, it is absolutely essential that we revitalize and stabilize their infrastructures. Second, in order to address

the larger and more significant systemic problem, which includes, not just school

and county government support, but also the economic and social health of our communities, and the health and sustained multiple use of our Federal forest lands, we

are proposing the creation of a National Committee appointed by Congress to develop recommended legislation and/or policy revisions. These recommendations will

emphasize increasing receipt generation, minimizing adverse budget impacts, promoting economic benefits to schools and counties, while simultaneously ensuring

healthy, long-term sustained use of our National Forest lands.

We strongly believe that these recommendations can and should be formulated

during the first three years of the safety-net and then submitted to the Administration and Congress for their consideration. It is further our belief that these recommendations should be enacted into law within two years of their receipt by Congress.

A focused national conversation devoted to defining a long-term solution to our

Federal forest management practices and their resultant effects upon long-term sustainable forest health, community economic and social stability, and the vitality and

effectiveness of school and county infrastructures is critically needed in our country.

This bill provides such a mechanism. This is a systemic problem and it must be

solved with a systemic solution. The current laws regarding payments to states

should remain untouched. Specifically, the Coalition is adamantly opposed to decoupling or disconnecting county and school payments from actual gross forest receipts.

We believe that the U.S. Forest Service and the Bureau of Land Management must

continue to have incentives to manage the National Forests for the production of

materials for the nation, to generate resources for the Treasury and payments to

counties and schools and be diligent about the active healthy management of our

National Forests. It is possible to have sustained-yield multiple-use forests which

produce materials for our Nation, revenue to support local community infrastructures, provide the economic and social vertebrae for local communities, and simultaneously provide wildland fire protection, pure watersheds to sustain our urban and

suburban population centers, and maintain ecologically healthy forests. These are

mutually compatible and not mutually exclusive goals. There are those in our society today that are spending millions of dollars on advertising, public relations, and

legal fees to convince us that this is an ‘‘either/or situation’’ when in reality, we

know that these goals are compatible. Consequently, we strongly believe that payments to counties and schools, unconnected from the corollary improvement in economic self-determination and improved social conditions will not work. Likewise,

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neither will payments to counties work, which are unconnected to incentives to actively manage on a sustained basis, the dominant economic asset in forest counties—the forest land itself. All of these factors are connected parts of an ecological,

economic and social system, and any long-term solution must achieve a balance between these factors.

We believe that this can and must be done for the benefit of our rural counties

and schools and the long-term health of our Federal forests. The Forest Counties

and Schools Coalition urges your support of H.R. 2389. It meets the immediate

needs of forest counties and schools while providing a blueprint for the construction

of a long-term solution to our current forest management gridlock and its attendant

consequences.

Thank you.

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Mr. HILL. The Chair recognizes Mr. Spain for your testimony.

STATEMENT OF GLEN SPAIN, PACIFIC COAST FEDERATION OF

FISHERMAN’S ASSOCIATIONS

Mr. SPAIN. Thank you, Mr. Chairman. Let me explain a little bit

of our interest here. We are the largest organization of commercial

fishermen in the West Coast and many of our people have been

salmon fishermen. Salmon is the number two forest-dependent industry in the West Coast. Salmon, just 10 years ago, provided over

62,000 jobs and $1.25 billion to our economy. Much of that is in

jeopardy because of past forest practices that have devastated watersheds and put over 25 different major runs of salmon on the endangered species list, with more to come.

The reality is that a lot of past practices in the forest on public

lands were simply unsustainable. They could not continue without

doing major damage to industries such as ours, to municipal water

supplies which are heavily dependent on those forest watersheds,

and to a variety of other economic sectors. That is one of the reasons that a lot of the harvest has been cut back, and I think those

are sound public policies toward sustainability in the future. It is

not just salmon. Sport fishing is a $108 billion industry, is in every

State in this country, and in many of those States those fisheries

are dependent on public lands.

The real issue and the real cause of the crunch is not even reduction in harvest because we have seen, as a result of globalization,

harvest go up whereas the timber job base and the timber industry

goes down because of automation. The real issue is globalization.

If you look at the difference between 1908 and 1999, today we live

in an interlocked global timber economy. At this point in time, this

is causing enormous competitive pressure on the timber industry,

a reduction in the timber job base, and particularly important for

this schools 25 percent payment structure is that it causes enormous fluctuations in the price of timber.

Take the stumpage price. Some of the facts and figures, if you

look at the real numbers, you find that in the 1980s there was a

huge collapse of stumpage prices, almost six-fold losses for county

payments. Payments are 25 percent of the price that timber

fetches. If the price collapses because of global markets, this is because of problems in the Japanese economy that were basically

linked to our timber markets because of global interests. You find,

for instance, in 1985 to 1993, in Oregon, the State I live in, just

in an 8-year period of time, the stumpage price went from $100 per

thousand board feet to $623. That is a 623 percent change in 8

years.

If you look at Federal timber sales, the situation is even worse.

Between 1993 in eastern Oregon and 1997, there was roughly a

seven-fold change in timber stumpage prices. You cannot build a

county budget on that kind of instability, frankly. We do not live

in the same world as we did 100 years ago where these prices were

relatively stable and within the control of local and national forces.

At this point it makes no sense to continue to hold county budgets hostage to international timber markets in Singapore, Japan,

and the Philippines. One of the reasons we have seen current

stumpage prices collapse is because of economic instability in Asia.

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Again, these collapses were due to global market forces, not timber

harvest policy, more than anything else.

Now, looking at the various bills in front of you, they all have

good elements, and they all have missing pieces. What we would

propose as a bill that would do the job would be one along the administration’s policy for fixed payments in perpetuity outside of the

appropriations process, and as Mr. Dombeck pointed out, that is

what we already have. I think Mr. DeFazio’s bill does that, too.

Perhaps Mr. Boyd’s bill does that, but only for 5 years. Payments

should also be indexed for inflation. The DeFazio bill and Mr.

Boyd’s bill do that. The administration’s does not. I don’t think that

they can do it without congressional approval. It should also be

management neutral. The current system works fine.

I don’t think, frankly, that taxpayers in this country will put up

with special management deals being cut in back rooms without all

public taxpayers being able to participate in the process.

So whatever we need, we need something that is management

neutral and basically not special interest driven. There should be

a choice made. In most every instance, the administration’s deal is

a good one. I provided in my testimony, in the back of my testimony, a chart showing how that impacts Oregon. That will make

a $21 million plus difference to Oregon just in the current proposal.

Now we do not take a position on the precise formula. Seventysix percent, a hundred percent, you know, what average? That is

negotiable. I have talked to people in the administration and a lot

of people on the Hill, and that is all negotiable. Numbers can be

supplied by the Forest Service upon request in terms of comparisons to past practices.

In summary, I think you really need a bill, and it needs to come

out of this Congress this session, that breaks the link between

county budgets and Singapore and Philippines timber markets

which are out of our control, subject to massive fluctuations without notice, outside of anything that we have any control of, and

which causes the instability that a lot of these counties are suffering from.

A stable payment program is on the table in every proposal.

There is no argument with that. What we are arguing over is the

details. I would submit my testimony for the record, and I would

be happy to answer any questions.

[The prepared statement of Mr. Spain follows:]

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Mr. HILL. Mr. Spain, thank you very much for your testimony.

We do have a vote on the final passage of the military construction.

And so what I would do is recess, propose a recess for about 15

minutes, let’s say until 10 after, and then we will pick up the testimony of the last two witnesses if that is agreeable with everyone.

Thank you very much. We stand in recess for 15 minutes.

[Recess.]

Mr. HILL. We will reconvene the hearing. Thank you all for your

patience.

Our next panelist is Mr. Bobby Green, chairman of the Lane

County Board of Commissioners. Mr. Green.

STATEMENT OF BOBBY GREEN, CHAIRMAN, LANE COUNTY

BOARD OF COMMISSIONERS, EUGENE, OREGON

Mr. GREEN. Thank you very much for the opportunity to speak

before this Committee. I really appreciate the opportunity. I would

like to tell you about Lane County and much of this will sound very

familiar to you and others. But I think it will be helpful in your

process and ultimately hope it would lead to some sort of a decision

at some point in time.

Lane County is one of the most unique counties in the United

States. It is about the size of Connecticut with more than a third

of a million people. Our land stretches from mountain ski slopes to

ocean sea shores. Most Lane County citizens live in Oregon’s second largest urban center, the Eugene-Springfield metro area.

We are a microcosm of the U.S. counties reliant on Federal forest

policies. Forest land comprises 88 percent of Lane County. The

United States Government, the U.S. Department of Agriculture,

Forest Service, and the U.S. Department of Interior, Bureau of

Land Management, owns more than half of the county, 54.2 percent to be precise. Lane County, Oregon is home to one of the largest combined Federal and O&C forest properties in the United

States today. Because the county is more than half federally owned

or managed, a unique partnership with the Federal Government

was created almost a hundred years ago.

Since 1908, Oregon schools and local governments have had a

good partnership with the U.S. Forest Service. Timber resources

from the Federal lands are used to provide raw materials for developing industry and economic growth. Funds from selling these materials provide education for our citizens. The funds pay for the

transportation system to get the raw materials to the market. They

provide resources to the Federal agencies administering the lands.

They assist the Federal Treasury. The partnership has worked extremely well in Lane County.

While we continue to diversify our economic base, the timber industry still provides 6,900 jobs in our county. Lane County’s owl

guarantee portion alone has provided an additional $22 million to

help educate Oregon’s children. In addition, it funded $66 million

to maintain and modernize 1,500 miles of roads and bridges in

Lane County’s transportation system. These roads are heavily used

by the timber industry and Federal agencies as timber moves to

the mills and the marketplace.

National forest timber revenue is used to finance the planning,

design and construction of new county roads and bridges. All of

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these services are at risk of severe reduction or complete elimination on June 30, 2004, if no changes are made to the current system. That is when Lane County expects to lose close to $12 million

a year. The history of the Oregon & California railroad lands,

O&C, is long, unique, and quite colorful. Lane County’s O&C lands

comprise about 2.4 million acres of forest land managed by the

BLM.

Before 1903, these lands were in private ownership and available

as resources for local government taxation. Because the O&C railroad failed to comply with Federal law and after much litigation,

including a case that went all of the way to the United States Supreme Court, these lands were revested in the Federal Government. In 1938, the Federal Government granted 50 percent of the

revenues from the O&C land to counties.

With the partnership, counties could use the funds to provide

vital public health and public safety services to its citizens, despite

the fact that more than half of the county is exempt from taxation.

In 1952, the O&C Association formed a partnership with the BLM,

both parties agreed that one-third of the counties’ share of timber

revenues be reinvested in managing the lands to improve future

harvests.

For years it worked extremely well, turning Oregon and California railroad lands into some of the country’s most productive forest land. Unfortunately, just as counties were about to get a return

on their investment, Federal forest policy changed. As a result,

counties did not get the return. Over time through this plowback,

O&C counties voluntarily returned more than $2 billion in timber

revenues to the BLM. Lane County’s share of this lost investment

is more than $314 million.

About 25 percent of Lane County’s general fund is financed by

O&C timber revenue. It is used to pay for critical public safety and

health services. In fact, 75 percent of the discretionary funds provide services such as immunization, communicable disease control,

county jail and rural police patrols. It is a dilemma. We are one

of many counties who have partnered with the Federal Government for nearly 100 years in sharing the Federal timber receipts.

Lane County is different from other counties because the Federal

Government owns 54 percent of us, all of this forest land.

This means only 46 percent of the property in our county is taxable. What is more, because of our unique partnership, we did not

increase property taxes as did some Oregon counties. As a result,

our tax rate alone cannot totally support our public safety and

health services. In plain English, our budget relies on the current

owl safety net.

If guaranteed timber payments are not stabilized, the county

cannot recoup its loss. Even if the citizens want to make up the difference, they can’t. Why? Because in 1997, a State imposed property tax limitation prohibits any county from permanently increasing property tax.

We relied in good faith on our partnership with the Federal Government. Now we are afraid this reliance will cripple our critical

public safety, health services, and transportation if Congress does

not stabilize the payments. The bottom line, if our Federal Government decides to take a big chunk of Oregon’s Federal forest land

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out of timber production, counties should be compensated. Also, if

the harvestable timber sales quantity is cut or eliminated to satisfy

the administration’s or Congress’ competing policy objectives we

should be compensated as well.

We are certainly aware of the tight Federal budget. However, almost 100 years ago we made a deal with the Federal Government

and we have upheld our end of the deal by providing health services, public safety, and roads. Now we call on Congress to ensure

that the Federal Government upholds its part of the bargain. We

urge you to seriously consider and adopt a viable stabilization plan.

I would like to call your attention to the fact that the Lane County Board of Commissioners has carefully considered how best to

solve the problem of counties relying on Federal forest funds. And

on June 2, 1999 the board voted unanimously on a resolution backing the Federal action to stabilize the payments. And Mr. Chairman, for the record, I would like to submit this resolution which

was unanimously endorsed by the Lane County Board of Commissioners if I may at this time.

[The information follows:]

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Mr. GREEN. Given that, the resolution goes on to speak to four

points.

Continue payments in perpetuity, number one.

Number two, provide for inflationary increases.

Three, revert to the actual harvest receipt formula if payments

ever drop below the original funding formula. If receipts ever go

above the original formula, Congress should review the appropriations.

Four, allow counties to participate in the land management decisions. Given the immediacy of the issues we cannot endure a prolonged debate over best forest management practices.

We believe the best and most practical approach is to stabilize

our partnership with the Federal Government and in order to permanently provide for the maintenance of critical services for our

citizens.

Thank you, Mr. Chairman, for the opportunity to testify, and I

stand ready to answer any questions which come forward.

Mr. HILL. I thank you, Mr. Green.

[The prepared statement of Mr. Green follows:]

STATEMENT OF BOBBY GREEN, CHAIRMAN, LANE COUNTY BOARD OF COMMISSIONERS

Lane County is one of the most unique counties in the United States. It is about

the size of Connecticut with more than a third of a million people. Our land

stretches from mountain ski slopes to ocean seashores. Most Lane County citizens

live in Oregon’s second largest urban center, the Eugene-Springfield metro area.

We’re a microcosm of all U.S. counties reliant on Federal forest policies. Forest land

comprises 88 percent of Lane County. The United States government—the U.S. Department of Agriculture, Forest Service, and the U.S. Department of the Interior,

Bureau of Land Management—owns more than half of the county, 54.2 percent to

be precise.

Lane County, Oregon is home to one of the largest combined Federal and O&C

forest properties in the United States today. Because the county is more than half

(54.2 percent) federally owned or managed, a unique partnership with the Federal

Government was created almost 100 years ago.

Since 1908, Oregon schools and local governments have had a good partnership

with the U.S. Forest Service. Timber resources from Federal lands are used to provide raw materials for developing industry and economic growth. Funds from selling

these materials provide education for our citizens. The funds pay for the transportation system to get the raw materials to the market. They provide resources to the

Federal agencies administering the lands. They assist the Federal Treasury.

The partnership has worked extremely well in Lane County. While we continue

to diversify our economic base, the timber industry still provides 6,900 jobs in our

county.

Lane County’s ‘‘Owl Guarantee’’ portion alone has provided an additional $22 million to help educate Oregon’s children. In addition, it funded $66 million to maintain

and modernize 1,500 miles of roads and bridges in Lane County’s transportation

system. These roads are heavily used by the timber industry and Federal agencies

as timber moves to the mills and the marketplace.

National forest timber revenue is used to finance the planning, design and construction of new county roads and bridges. All of these services are at risk of severe

reduction or complete elimination on June 30, 2004. If no changes are made to the

current system, that’s when Lane County expects to lose close to $12 million a year.

The history of the Oregon & California Railroad lands (O&C) is long, unique and

quite colorful. Lane County’s O&C lands comprise about 2.4 million acres of forest

land managed by the Bureau of Land Management (BLM). Before 1903, these lands

were in private ownership and available as resources for local government taxation.

Because the O&C Railroad failed to comply with Federal law, and after much litigation, including a case that went all the way to the United States Supreme Court,

these lands were ‘‘revested’’ in the Federal Government.

In 1916, Congress directed a portion of the resources to the counties. However,

little funding actually made it to local governments. Future Federal acts continued

to provide that a portion of the proceeds be given to counties.

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In 1938, the Federal Government granted 50 percent of the revenues from O&C

lands to counties. With the partnership, counties could use the funds to provide vital

public health and public safety services to its citizens, despite the fact that more

than half the county is exempt from taxation.

In 1952, the O&C Association formed a partnership with the Bureau of Land

Management (BLM). Both parties agreed that one-third of the counties’ share of

timber revenues be reinvested in managing the lands to improve future harvests.

For years it worked extremely well, turning Oregon & California Railroad lands into

some of the country’s most productive forest lands. Unfortunately, just as counties

were about to get a return on their investment, Federal forest policy changed. As

a result, counties did not get the return. Over time, through this plowback, O&C

counties voluntarily returned more than $2 billion in timber revenues to the BLM.

Lane County’s share of this lost investment is more than $314 million.

About 25 percent of Lane County’s general fund is financed by O&C timber revenue. It is used to pay for critical public safety and health services. In fact, 75 percent of the discretionary funds provide services such as immunizations, communicable disease control, county jail and rural police patrols.

It’s a dilemma. We are one of many Oregon counties who have partnered with

the Federal Government for nearly 100 years in sharing Federal timber receipts.

Lane County is different from other counties because the Federal Government

owns 54 percent of us—all of it forest land. This means only 46 percent of the property in our county is taxable. What’s more, because of our unique partnership, we

did not increase property taxes as did some Oregon counties. As a result, our tax

rate alone cannot totally support our public safety and health services. In plain

English, our budget relies on Federal timber money.

If guaranteed timber payments aren’t stabilized, the county cannot recoup its loss.

Even if citizens want to make up the difference, they can’t. Why? Because in 1997,

Oregon voters adopted Ballot Measure 50, a property tax limitation measure that

prohibits permanent increases in the property tax rate.

We’ve relied in good faith on our partnership with the Federal Government. Now

we’re afraid this reliance will cripple our critical public safety, health services and

transportation if Congress does not stabilize the payments.

THE BOTTOM LINE—If our Federal Government decides to take a big chunk

of Oregon’s Federal forest land out of timber production, counties should be compensated. Also, if the harvestable timber sales quantity is cut or eliminated to satisfy the Administration’s and Congress’ competing policy objectives, we should be

compensated as well.

We are certainly aware of the tight Federal budget. However, almost 100 years

ago, we made a deal with the Federal Government and we’ve upheld our end of the

deal by providing health services, public safety and roads. Now we call on Congress

to insure that the Federal Government upholds its part of the bargain. We urge you

to seriously consider and adopt a viable stabilization plan.

I’d like to call your attention to the fact that the Lane County Board of Commissioners has carefully considered how best to solve the problem of counties reliant

on Federal forest funds, and on June 2, 1999, the Board voted unanimously on a

resolution backing Federal action to stabilize payments and asking to:

(1) Continue payments in perpetuity.

(2) Provide for inflationary increases.

(3) Revert to the actual harvest receipt formula if payments ever drop

below the ‘‘original’’ funding formula. If receipts ever go above the

original formula, Congress should review appropriations.

(4) Allow counties to participate in land management decisions.

Given the immediacy of the issue, we cannot endure a prolonged debate over best

forest management practices. We believe the best and most practical approach is to

stabilize our partnership with the Federal Government in order to permanently provide for the maintenance of critical services for our citizens.

Thank you for this opportunity to testify, I will be happy to answer any questions.

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Mr. HILL. The final panelist is Mr. William Dennison from

Plumas County, Supervisor, District 3, Chester, California.

STATEMENT OF WILLIAM N. DENNISON, SUPERVISOR,

DISTRICT 3, PLUMAS COUNTY, CALIFORNIA

Mr. DENNISON. Thank you very much, Chairman Hill, Subcommittee members and full Committee members.

I am Bill Dennison, Plumas County, District 3, Supervisor. I am

speaking on behalf of Plumas County Board of Supervisors, the National Association of Counties, Regional Council of Rural Counties,

which is in California, and the California State Association of

Counties. The National Association of Counties has a membership

of 1,857 counties. There are 800 counties that are forested in the

United States that receive this revenue from the Federal timber

sale receipts program. You are addressing a very important issue

to all of us, and we thank you for that.

Congressman Boyd did a great favor by documenting a lot of the

reasons for the importance of that Act of 1908 so I will not belabor

that except to point out the fact that in 1908 the General Accounting Office report contains a statement which is very important to

us today; and they said, and I quote, since the early 1900s, the

Congress has enacted more than 20 laws directing that a State or

county be compensated for a Federal presence in the state. It was

a promise that was made in 1908. It has been reaffirmed 19 other

times, and it is a promise that must be sustained as you have

heard from other members today.

You are aware that the timber sale receipts have been decreasing, but I want to tell you about Plumas County because it is very

close to us there where the Federal lands constitute 73 percent of

the land base, and our revenue has been reduced from almost $9

million per year to $1 million per year. The $4 million lost for each

of the school and the road systems have been very severe, and I

can provide you with more data. And I have done that in my written statement.

In summary, our roads are deteriorating, and our school children’s education is being impacted. It is for those reasons that we

entered into a broad coalition, the greatest I have ever seen. I wish

we had those years ago, things would have been different, I believe.

We didn’t have them. We have them now. It is a grassroots movement that is potent that should be listened to. But entering into

those understandings, we came up with principles that have been

noted; but I want to just briefly go over those again.

This corrective legislation must cover all of the national forest

counties nationwide. Secondly, the payments are to be guaranteed

based on 100 percent of the 3 highest years during the period of

1986 to the date of the passage of the bill. That is not a small decision that was made. We found in our compromise in our discussions if we did not do that, some of the Eastern counties would be

losers; and so we brought them into the fold and thought that was

a good way to go. The administration proposal to restrict the base

to 76 percent of the period between 1985 and 1996 would penalize

some of these States.

The either or language has been included to allow for payments

to ensure that you can get as good or better payment in case your

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receipts are higher. That is a reasonable thing. The CPI indexing

has been noted before, but most important, and we have talked

about this already, is the decoupling. And we believe there should

be no change in the Act of 1908. There should be no decoupling of

the payments from the production of our national forests as proposed by the administration. The last principle relates to the fact

that we wish this legislation to be short term, a short-term financial safety net with a means to pursue a long-term resolution toward securing the delinquent revenues. That is covered under section 7 of the bill.

We agree that land use management should not be for the sole

removal of trees, but good management will, in fact, remove some

trees during the process. That is why we supported the passage of

the house when you acted on the Herger-Feinstein-Quincy Library

bill, that great vote of 428 to 1 before.

We supported you on that. That is why we now view that bill as

a means to a long-term solution to the issue before us today.

I have a copy and a longer written statement, Mr. Chairman,

and a copy of an 8-page article in the July 1999, Smithsonian magazine, A Town Buries the Axe. I would like to include those in the

record.

Mr. HILL. Without objection.

All of the panelist’s written testimony will be part of the record.

[The information follows:]

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Mr. DENNISON. I hope you have seen the Smithsonian report on

the Quincy Library Group. It highlights the balanced management

approach which you all embraced through that QLG bill as a

means to protect against catastrophic wild fires. We are waiting for

the final environmental impact statement completion by Forest

Service so we can work together to begin that adaptive management process and have it utilized eventually not just in our area.

We think that it is applicable to many places throughout the Nation, but this is going to take a couple of years and in the meantime, our counties need help. I suggest we should not be here talking about what the level of the cuts should be. That is another

issue. We should be talking about how can we get the job done.

Certainly there are some controversial issues, and I agree with

Chief Dombeck on that. However, I think some of the things that

were happening with the grassroots coalition, we can work some of

these things out so they are not so controversial in the future. And

there can be increases in timber harvest with sound environmental

practices as well. We must strive for that goal.

In closing, I would call to your attention again that Smithsonian

report. A past Plumas County supervisor, Bill Coates, my predecessor, was quoted in the article as saying the following. Mr.

Coates said, ‘‘America needs its rural America. You can’t live in

Ohio and visit Plumas County unless there are hospitals there, unless there is law enforcement, unless there are roads to drive on.

You have to have local infrastructure so if they get hurt, we can

treat them. If they get lost we can find them. To keep that fabric

together,’’ Mr. Coates said, ‘‘the people of the town have to unite

to work together to put aside their differences for the good of the

town and for the good of everyone.’’

Chairman Hill and Committee members, that is the reason that

I am happy to be with you today. We are not asking for handouts

or entitlements. We are not asking that you determine the forest

management level here today. We are asking for the opportunity

to unite and develop a means by which the forest management

funding system will serve the purpose for which it was intended.

If rural communities are to be in a position to continue to serve the

Nation, there must be more consideration of the resources for

which they are willing and able to provide, and at the same time

there is a need to fulfill the promises of our Federal Government

to pay its fair share for maintaining our county schools and our

roads.

To that end, we thank you for the support of H.R. 2389.

[The prepared statement of Mr. Dennison follows:]

STATEMENT OF WILLIAM N. DENNISON, SUPERVISOR, DISTRICT 3, PLUMAS COUNTY,

CALIFORNIA

CHAIRMAN CHENOWETH AND MEMBERS OF THE COMMITTEE:

I am Bill Dennison, Plumas County Supervisor; District 3, in California. We are

situated in Northern California, north of Sacramento and west of Reno Nevada.

Today, I am speaking on behalf of the Plumas County Board of Supervisors and the

National Association of Counties (NACo). I chair the NACo Public Lands Steering

Committee, which shares a great concern in our issue today, since 800 counties

throughout our nation receive revenue from the Federal timber sale receipts program. We are part of the Forest County Schools Coalition which currently has endorsements from over 500 groups in 32 States and is growing daily. You are addressing a very important issue.

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Thank you for scheduling these legislative hearings and for the opportunity to

convey support for H.R. 2389 and the reasons why such a bill is necessary.

A United States General Accounting Office report to past Congressman Vic

DeFazio contains a statement which summarizes an important part of the issue before us today: ‘‘Since the early 1900’s the Congress has enacted more than 20 laws

directing that a state or county be compensated for a Federal presence in the state.’’

Congress recognized that the formation of the National Forests were large-scale

withdrawals, with acreages being as high as 50 to 90 percent of some counties gross

acreage’s. Local government was concerned there would not be adequate tax base

to provide appropriate public services. The substantial opposition to this action on

the part of the Federal Government was mitigated by the Act of 1908 and as noted

by GAO has been reaffirmed 19 more times over the years. It was a promise to the

people that must be sustained. This compensation has been provided in varying percentages, but for the most part 25 percent of the gross receipts from commercial national forest activities have been distributed to counties through state government

for the use of schools and roads. (16 U.S.C. 500). Over 95 percent of those funds

have been from timber sale receipts.

Recent changes in national forest land management philosophy and practices

have caused large portions of the National Forests to be considered off-limits for

commercial activities. Some of these changes have been initiated by law, some by

agency policy change and some may be temporary, as agencies search for scientific

truths to answer the intricacies of the Endangered Species Act and other conflicting

laws which have been passed by Congress over the years. The end-result has been

an average loss of about 75 percent of county revenue from Federal timber sale receipts.

In my County of Plumas, Federal lands constitute 73 percent of the land base and

our revenue has been reduced from almost $9 million to about $1 million during the

last 8 years. Plumas County has only a population of 22,000, with a local budget

of $44 million. We are experiencing the impact of the $4 million dollars lost per year

to each of the school and road departments.

It requires $4.1 million to properly operate the public works department. Our

Plumas County Director of Public Works has recently reported that this year revenues are estimated to be $1.8 million from gas tax and $0.5 million from the 25

percent timber sale receipts. The remainder of the budget must come from our diminishing reserve, which will be depleted in 2 years. The director reported that he

began the reduction in asphalt paving 3 years ago and chip sealing of the roads 2

years ago, in order to maintain a reasonable reserve. That fact is recognized in the

obvious road deterioration throughout our county, but the degradation will accelerate if we can not return to a regular road maintenance program.

Next year, if there is not a replacement of the lost timber sale receipts revenues,

we have been told that there may be a reduction in snow removal services. We receive snow depths of 2 to 3 feet in a given storm with total depths up to 10 feet

in northern Plumas County. The loss of snow removal potential presents a severe

deterrent for our emergency services, which include health, fire and law enforcement. These are often life-threatening situations, not a luxury forgone.

The next budget considerations which the Board of Supervisors will be forced to

face will be personnel reductions in two years, or less.

Our Plumas County Unified School District Superintendent, Dennis Williams

made visits to the Hill with the Quincy Library Group the past two years in recognition of the financial crises he has been facing. Mr. Williams reported to me last

week that school budget cuts, as a result of decreased forest receipt revenues has

resulted in the following impacts:

• Class size has increased in grades 4-12 to a 30:1 student:teacher ratio.

• All funding was eliminated for all extra-curricular activities but some has been

restored over the past two years as a result of a temporary Necessary Small

School funding provision from the State.

• Custodial and maintenance staffs have been reduced.

• School site supply budgets have been reduced.

• High school counselors were eliminated.

• Administrative staff was reduced.

•Transportation was reduced by eliminating several bus stops.

I have attached a chart and a graph which depicts the forest receipts history of

reductions to the Plumas County School District.

It is for these reasons that a nation-wide coalition was formed to pursue legislation that is based on the following principles:

•The corrective legislation must cover all National Forest Counties nationwide,

including the Oregon and California (O&C) Counties. This is important because

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the impact of Federal land policy changes are being felt from the Atlantic to

the Pacific.

•Payments are to be guaranteed based on 100 percent of the three highest

years during the period 1986 to the date of passage of a Bill. This is an important factor, because some of the eastern forests have increased their sale program over the past couple of years. The Administration’s proposal to restrict the

base to 76 percent of the period between 1985 and 1996, would penalize these

eastern states. The imposition of a cap on the total increase to a county, as proposed by the Administration is also unfair and unacceptable.

• ‘‘Either/or’’ language must be included to allow for payments based on actual

receipts if the amount is greater than the short-term guaranteed payment level.

(See Section 5, subsection (b)(2).)

• CPI indexing should be included. (See Section 4, subsection (b).)

• Most important, there must be no changes to the Act of 1908. The proposal

for changes by the Administration during the past year has been coined a ‘‘decoupling’’ from production of our national forests. This constitutes an entitlement which the coalition is unwilling to accept. There are several good reasons

for this position:

First, we believe that the national forests are in terrible condition and

must be managed. We face catastrophic wildfires that can best be minimized through strategic removal of trees. Reinvestment in our watersheds,

not lock-up of our resources is the right thing to do.

Secondly, the management of these lands provide products and jobs for

our nation that far exceed the 25 percent timber sale revenue. It is important that in the long-term the Act of 1908 and those 19 Congressional

passed Bills that followed are upheld to assure that the revenues and production are not separated.

Third, our nation should not initiate more entitlements, when there are

means to pay for programs through our existing resources.

•The last principle relates to the fact that we are only requesting a short-term

‘‘safety net’’ and the means to pursue a long-term solution to securing the

delinquent revenues. We believe that the latter is set forth in Section 7. DEVELOPMENT OF LONG-TERM METHODS TO MEET STATUTORY PUBLIC

SERVICES. Under item (c) (2) you will note that we wish to increase the revenues, but only where ‘‘. . . ecological, economic and social factors are accorded

equal consideration in the management of Federal lands.’’ The Committee shall

terminate three years after the date of the enactment of this Bill. That and the

provision that payments to eligible States and eligible counties are to be replaced by a long-term solution within two years after the date of submission of

the report required by Section (7)(c)(1), is indication of our commitment to a

quick solution.

We agree that land use management should not be for the sole purpose of removing timber. That is why we supported the passage of the Herger-Feinstein Quincy

Library Group Act. It is why we now view that bill as the means to a long-term

solution to the issue before us today.

You will recall that QLG bill passed the House of Representatives by a vote of

428 to 1. It then passed the Senate and is now being reviewed by Forest Service

under their Draft Environmental Impact Statement. Currently, the DEIS and the

QLG bill is under attack by Sierra Club. Not because it is a bad bill, but because

the Club has adopted a platform to stop the harvest of all trees on National Forest

lands. In fact the Herger-Feinstein QLG Act is a very balanced approach to forest

management.

With the chair’s permission, I would like to submit a copy of an eight page article

in the July 1999 Smithsonian—A Town Buries The Axe. It emphasizes the balanced

management approach which you all embraced and the need to protect against catastrophic fires through cooperative land management. Author Edwin Kiester Jr.

spent considerable time touring the Plumas, Lassen and portion of the Tahoe National Forests to develop an understanding of why management of our natural resources are necessary and how the Quincy Library Group (QLG) turned controversy

into consensus. The Quincy Library Group learned the lesson of ‘‘fuel ladders’’ and

the need to thin the overstocked forest stands. The author notes that the Cottonwood fire which broke out in July of 1994, ‘‘. . . represented a major shift in QLG

strategy.’’ ‘‘The fire broke out in the undergrowth and quickly jumped to the crowns

of the pines, swept from treetop to treetop and soon became an inferno.’’ The fire

burned 47,000 acres, almost consumed the town of Loyalton and cost the state and

Federal Governments $12 million before it was contained. The QLG decided that the

chance of this catastrophe could have been reduced by thinning of the forests.

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I enter this article into the record because it displays the fact that the QLG Bill

is the potential long-term solution to the problems which I have reviewed above. It

is a solution that has been approved by Congress and now awaits the implementation of the adaptive management process that can be fine-tuned and used in many

other areas of our nation.

The Smithsonian article quoted Bill Coates, a past Plumas County Supervisor and

one of the originators of the QLG as a closing to Kiester’s article: ‘‘America needs

its Rural America. You can’t live in Ohio and visit Plumas unless there’s a hospital

there, unless there’s law enforcement, unless there are roads to drive on. You have

to have local infrastructure, so that if they get hurt we can treat them, it they get

lost we can find them. To keep that fabric together, the people of the town have

to unite, to work together, to put aside their differences for the good of the town

and the good of everyone.’’

Chairman Chenoweth and honorable Committee members, that is the essence of

the reason why I am before you today. We are not asking for hand-outs, or entitlements. We are asking for the opportunity to unite, work together, put aside our differences and develop a solution. If rural communities are to continue to serve our

nation, there must be more consideration of the resources which they are willing

and able to provide and there is a need to fulfill the promises of our Federal Government to pay it’s fair share for maintaining our county schools and roads.

To that end, we will thank you for support of H.R. 2389.

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Mr. HILL. Thank you. The Chair will now recognize Members on

each side alternating when they appeared before the Committee.

Mr. Sherwood, you are recognized.

Mr. SHERWOOD. Thank you, Mr. Chairman. Mr. Spain, what

would you think if we had a program where we were going to absolutely stop all salmon fishing for the foreseeable future?

Mr. SPAIN. That is, in fact, the case in the Coho Fishery right

now and in the case of the majority of the salmon fisheries on the

West Coast.

Mr. SHERWOOD. So we are never going to fish for salmon again?

Mr. SPAIN. Right now they are closed for conservation reasons,

and that is because otherwise they are not sustainable in the long

run. Also we have to deal with the habitat issues in the forests

which are driving some of the declines.

Mr. SHERWOOD. If we just decided that we would abandon that

resource for all time, that would be a great waste. Just like it

would be a great waste to have zero cut on our national forests. We

need to manage the system, and I think it is incumbent upon us

here—I mean, we are going down the road and getting tacks in our

tires and we are trying to determine whether to use red or blue

patches.

We have to decide how to get the tacks off the road. I think we

have lost our will to manage. I think it is partially the Congress’s

fault; but we have great national resources and there are people

saying don’t destroy our communities. We can subsidize them or

help them prosper. I think there are some very important issues

here. You are looking at it from your point, you want us to not silt

up the rivers and destroy your salmon, and you are dead right. We

should not do that. We should not rape our forests and silt our

streams, but we can’t become hostage to the zero cut crazies. We

need the will to manage the system. It is entrusted to us.

Now, Mr. Dombeck, could you help me. Let’s go back to the

southern forest, the Apalachicola. Were those figures that were

given to us anywhere near or reasonably correct?

Mr. DOMBECK. Well, I haven’t seen the source, but I presume so,

yes. Let’s——

Mr. SHERWOOD. Do you know why then, I mean in that forest,

that’s not a—that is—that is a very different situation than the

West Coast. Why do you think that we are not harvesting timber

there?

Mr. DOMBECK. Well, we are harvesting timber there, but the balance is significantly different than it was 10 or 15 years ago, and

the issues driving some of the southern forests, of course, are the

red-cockaded woodpecker. In fact, there was significant progress, I

think, made there if we take a look at the fact of what happened

in the Pacific Northwest, where we basically had the timber programs completely enjoined, virtually zero; what was worked out in

the southeast was compacts with the industry, with the various

agencies involved, and there are, you know, the Fish and Wildlife

Service, the Forest Service, to arrive at that particular harvest

level without injunctions from the court system.

So in one sense, that is a success, although there is still debate

over the harvest levels, and I presume that will continue.

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Mr. SHERWOOD. So you have cut the harvest levels because you

are afraid of court action, because of the red-cockaded woodpecker?

Mr. DOMBECK. I—— Mr. SHERWOOD. There has been no court action to my knowledge.

Mr. DOMBECK. I would say what we did is, we worked with the

regulatory agencies and the community of interest to arrive at a

management program prior to—before they hit the courts, yes. I

think it is in the best interest of all of us to work together in that

manner because one of the things we know that the amount of

money that we spend in the court system really doesn’t benefit the

land, and the more that we can focus the energy in areas of agreement, the better our chances of success and, I think, building trust

are.

Mr. SHERWOOD. But—I certainly agree with that statement. But

I think—I don’t think we have looked at the waste in the system,

the waste in the salmon industry, because we did things wrong in

the past, and the waste in the timber industry now because we are

letting them become overmature and rot and fall down and letting

the communities that derive their income from that part of the

country wither and die. And then we have proposals where we will

support them with tax money. They don’t want to be supported

with tax money. They want an industry; they want their community to thrive. And I think we are a little bit on the wrong track.

And I think because of specific instances, we have—we have lost

our will to fight a little bit. And I look at the Allegheny National

Forest in Pennsylvania, and now I have seen today that the Apalachicola might be a good example. What—how does this Forest

Service make the decision in the Apalachicola, for instance, whether or not to have sales? I mean, what specific criteria?

Mr. DOMBECK. There is a forest planning process, a land allocation process, and then as projects are implemented, throughout the

process there is public input; and the environmental work, the appropriate NEPA work that is required to arrive at a record of decision. And then as with all—with virtually all programs there is an

appeals process where citizens want to have the right to question

decisions that are made by public servants, by government officials;

and in many cases, question they do.

In fact, with regard to your point about the will to fight, the Forest Service spends about $5 million a year in appeals and about $5

million a year in litigation just in the management costs and gathering the data. That is not even the legal costs that might, you

know, transcend the Department of Justice or Office of General

Counsel. So there is plenty of give and take at the public meeting

level and all throughout the system.

Mr. SHERWOOD. But am I to take it that it is cheaper to let the

forest rot than it is to fight the legal battles?

Mr. DOMBECK. You know, I think what is at the heart of the timber debate—and this has been going on for a long time; it transcends administrations, it transcends Congresses and chiefs and directors of BLM and all the agencies involved, and that is that if

we start looking at the desired future condition, what do we want

the forest to look like? What do we want the stand densities to be,

the make-up? I have yet to find anybody that is in favor of soil erosion, that is in favor of siltation of streams. We want healthy forVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00136 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
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ests and we want to be able to reap the benefits of those forests

for local communities.

I believe we will stay in this debate and our successors will be

in this debate unless we move beyond the intense competition that

we have and focus on what it is that we want on the land. You

know, we have got the best science in the world in the United

States; we ought to be applying that. And we have got tremendous

opportunities, I think, in the benefits that we derive from all of our

public lands.

Mr. SHERWOOD. Maybe some of that science should be put to

work to see if harvest hurts the red-cockaded woodpecker.

Mr. DOMBECK. In fact, I have to tell you one of the places I have

been where I see both industry and the Sierra Club standing together is also in Florida where they are both supporting small

clear-cuts for scrub jay habitat. They are doing prescribed fire, industries reaping the benefits of wood fiber there. But the fact is

they are focused on common goals that embody what they want the

land to be like and what they expect from it.

I think that as long as we look at a watershed and focus on

board-feet, the debate will remain here. If we focus on the desired

future condition, the benefits that we get from the land will flow

in a sustainable way.

Mr. SHERWOOD. Thank you.

Mr. HILL. The gentleman’s time has expired.

I would just remind all members that we are under the 5-minute

rule, and I recognize Mr. DeFazio.

Mr. DEFAZIO. Thank you, Mr. Chairman. We will do a second

round if we each so wish. Great.

Mr. HILL. Certainly.

Mr. DEFAZIO. Chief Dombeck, a couple questions. I mean, what

is there under current law that would require the President to submit or propose guaranties or extensions to counties? Is there anything that requires the President to put that in his budget?

Mr. DOMBECK. The two or three things that led to that, not that

I am aware of with regard to——

Mr. DEFAZIO. No. I mean, is there anything—I mean, he proposed a guarantee, extending a permanent guarantee to all counties. That is correct.

Mr. DOMBECK. If you take a look at the slope on that curve and

then you assume that if we didn’t have the safety net, in western

Oregon that slope would be significantly lower than it is, or higher

in the negative sense.

Mr. DEFAZIO. What I am trying to get at is that the proposal by

the President—which some people object to because of the decoupling, but in any case it was a proposal to provide revenues to

counties and it is something that the President does not have to

submit as part of his budget. There is nothing that requires him

to submit it as part of his budget.

Mr. DOMBECK. That is correct. I think the common goal that we

share, that we discussed here, is stability, is predictability, is providing a source of funding so that the superintendent of the

schools, the county commissioners and others in charge of social

services that communities need have some predictability in providing these services.

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And I, for one, as well as in the view of the Secretary in the administration, we are very solidly behind the commitment that the

Federal Government ought to be paying its way for these lands

that belong to all the people of the United States even though the

times change and the values and the public uses of these lands

change over time.

Mr. DEFAZIO. You used the words ‘‘strongly opposed’’ to the county schools coalition legislation. What—I know that the administration has an arcane process and sometimes the President does and

doesn’t do what he says he is going to do in terms of vetoing things;

I remember the salvage rider. But absent that, what would you recommend since you can only really answer for yourself to the Secretary and or the President? Should that bill be passed as currently

introduced?

Mr. DOMBECK. I would—my personal recommendation to the Secretary would be to veto it for a couple of reasons. Number one is

that we have a complexity of planning process mechanisms now,

and many Members of Congress are concerned about the confusion

that is already there. This adds another layer of confusion.

The other part that I am concerned about is the fact that tightening the link of any single use to important social services would

only exacerbate the debate, because it will further polarize the

issues. Because if we take a look at the benefits of national forests

today compared to 1908: In 1908 we were focused on restoration of

the Appalachian Mountains of the northeast; the Allegheny National Forest was nothing in 1908 like it is today; the

Chequamegon National Forest where I grew up in northern Wisconsin again was in tough shape compared to what it is today. The

values were different.

In fact, today if we look at the values, the contributions to the

gross domestic product of the national forests, we find that about

75 percent of that comes from recreation to people, hunting, fishing, hiking, biking, outfitters and guides, the whole array of uses

out there that are increasing at a significant rate that were not

there at the turn of the century. And so what we see is, we see,

you know, the wildlife values at about 9 percent, the mineral values contribute about 7 percent, and the timber values contribute

about 3.7 percent. So in one sense, why don’t we look at the broader array of values?

Mr. DEFAZIO. Chief, who sets forest policy? Do you set forest policy?

Mr. DOMBECK. Well, my job is to implement the legislation

passed by Congress and signed by the President.

Mr. DEFAZIO. Do you feel that you have, you know, done something to change forest policy in terms of the current levels of harvest; or have court precedents and other, you know, litigation

things led to you know a change in forest planning?

Mr. DOMBECK. I would say the key changes have really been a

result of the combination of legislation that we have to implement

and developing case law.

Mr. DEFAZIO. Okay. Which goes back to the point I made with

Mr. Boyd, which was that I think the responsibility rests here to

have the debate over forest policy.

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Mr. Douglas, I read your resume, which is impressive, but of the

25 years in schools where were you in 1983, where were you working then?

Mr. DOUGLAS. I was working for the Plumas Unified School District.

Mr. DEFAZIO. So you were in northern California. What happened to timber revenues in 1983 in Plumas County?

Mr. DOUGLAS. They were, as I recall, declining.

Mr. DEFAZIO. Pretty dramatically, as I recall.

Mr. DOUGLAS. Yeah, there was a national recession.

Mr. DEFAZIO. And I am about to run out of time, so I will use

my second round of questions, but I mean, let me then conclude

with the point that I was a county commissioner, elected in 1982

in Lane County and took office in 1983. And Lane County at that

point had laid off one-third of its work force and the remaining

two-thirds were working four days a week, and not because of Federal dictates in forest policy, but because of being linked to forest

revenues which were in the tank at that point in time, from the

most productive forest in the United States, which was the Willamette—so, you know, I am—and my time is up and I will be good

here, Mr. Chairman. I will just end with that statement. I will get

a second round. Thank you, Mr. Chairman.

Mr. HILL. Thank the gentleman very much.

The Chair recognizes Mr. Duncan.

Mr. DUNCAN. Thank you, Mr. Chairman.

Mr. Douglas, I got here late and you may have mentioned this,

but what percentage of your home county is owned by the Federal

Government?

Mr. DOUGLAS. About 52 percent.

Mr. DUNCAN. I just spent part of last week driving through

northern California, and it seemed like I would drive from a national forest into a national park into a State park. How much of

your county is owned by the State or local governments? Do you

know that?

Mr. DOUGLAS. Off the top of my head, I don’t know that. I do

know the Federal Government owns about 52 percent of it.

Mr. DUNCAN. And as you are—this is—we are hearing entirely

from witnesses from the West. Is this—but there are eastern counties involved in this problem as well. I know this—are you—is your

group made up of counties in the east as well or——

Mr. DOUGLAS. We have county representatives and school district

representatives and business and industry representatives from 35

States now, including almost all of the States of the West, half the

States in the Southwest, States in the north central part, Wisconsin area. Certainly in the East where there are national forests

we do have members, and we have members in the South.

Almost every region of the United States where we have national

forests are now represented in our coalition, Congressman.

Mr. DUNCAN. Mr. Dennison, how much of your county is in Federal ownership?

Mr. DENNISON. Ours is 73 percent.

Mr. DUNCAN. Do you happen to know how much is in State or

county government ownership?

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Mr. DENNISON. It is a small percentage, but the 73 percent certainly has a great impact on us.

Mr. DUNCAN. You know, nationwide, we have about—almost a

third of the land in Federal ownership, and then another 20 percent in State, local and quasi-governmental ownership. So we have

a little over half the land all over the Nation, and it has been growing by leaps and bounds over the last 30 or 40 years. And I think

at some point we need to recognize that private property has been

one of the real basic elements of our prosperity.

In fact, probably your counties would be much better off if we

could get some of that land into private ownership. I don’t guess

that is possible, but you really would boom if you could.

In fact, I was real interested, I read last week or week before last

a column in the Washington Times by former Governor Dupont of

Delaware, who said that—in his column, he said people don’t realize, because we are all clustering together because everybody wants

to be near the malls and the movie theaters and the restaurants

that only 5 percent of the land in this country is developed and

three-fourths of the population lives on 3.5 percent of the land. And

I mean, we all look at these maps of the United States on one little

page in a book, and we think this country is much smaller than

it really is. I can tell you that driving through northern California

for a couple days last week I am not worried about the redwoods.

I think I saw millions of them.

Mr. DENNISON. May I respond, Congressman? We have a considerable amount of private timberland in the north State, as well.

They have very strident, stringent force practice rules. But I can

assure you that the practices there, even though they are meeting

good environmental standards, are harvesting much more timber

than our Forest Service. The policies are what are bothering us

right now as much as the legislation, self-imposed policies waiting

for something to happen.

Mr. DUNCAN. Well, you know, the staff had told us a few months

ago that—I think it was in 1980 or so that sometime in the 1980s

we passed what was then seen as an environmental law to reduce

the cutting in the national forest to 80 percent of the new growth

or maybe it was 85 percent of the new growth. And today we are

cutting, they tell me, less than one-seventh of the new growth in

the national forest each year.

And, you know, it just seems, if we are going to have healthy forests, we have got to cut a few trees; and if we are going to have

houses and magazines and books and a lot of other things that

make up a good quality of life, we have got to cut a few trees. Yet

they are, as Mr. Sherwood said, referred to as ‘‘these crazies’’ who

don’t want anybody to cut anything.

But I still say that this country would be far better off if we had

less land in public ownership and more land in private ownership,

so that your counties such as you represent would be much stronger economically.

Thank you, Mr. Chairman.

Mr. HILL. I thank the gentleman.

Chief Dombeck, you made a comment, I think, with regard to the

situation in Florida, I think with the woodpecker, that there were

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common goals, industry groups and other groups and as a consequence of that that they were getting on the same page.

The coalition proposes to accomplish the following things: one, to

have stable economies; two, to have a stable source of revenues for

their counties and schools and to have sustainable forests and sustainable communities.

Is there anything about those goals that you disagree with?

Mr. DOMBECK. No.

Mr. HILL. I think you have to be impressed that this is a pretty

broad coalition of people, diverse group of people, broad interests.

Really, I am incredibly impressed with it. Do you think that these

communities should have—who are affected by this policy should

have some input into helping design the solution?

Mr. DOMBECK. Definitely.

Mr. HILL. I presume, then, that the administration proposal is

one that you recommended to the administration?

Mr. DOMBECK. It was the result of a fair amount of dialogue.

Mr. HILL. You helped develop that?

Mr. DOMBECK. Yes.

Mr. HILL. Which of the coalition members and counties that are

part of this coalition did you consult in the development of that policy?

Mr. DOMBECK. Let me ask Sandra Key, who was involved firsthand in much of that.

Ms. KEY. To answer your question, I was involved in the development of the proposal, and we went forward with it last year, not

seeking a sponsor and working very closely with the NACO county

associations, telling them what we were doing, telling them this is

what we wanted, recognizing that they were going to be a big part

of what this Congress chose to do about payments to States.

This year we came back, modified our proposal in some ways

that we felt were more acceptable then, recognizing it still was not

everything that they wanted. And at every step along the way, we

have provided and communicated with them and tried to be as

open and direct with the counties as we could be. And you could

perhaps ask them how they feel about that.

Mr. HILL. Well, I think maybe we will.

Mr. Dennison, do you have any response to that? Were you consulted?

Mr. DENNISON. I agree with Mrs. Key that they have told us

what they are doing, and we have disagreed with what they are

doing. And I think that is a fair statement.

Mr. HILL. You weren’t asked for your advice.

Mr. DENNISON. We gave it any way. And I think their view was

to seek our advice. But the big stumbling block, Mr. Chairman, is

the fact that theirs hinges on decoupling, hinges on a way of changing business as usual. We are trying to develop a coalition that will

tell us how it can be done better. That is why we think what you

did already sets that balance for us that we can work from the bottom up. And we saw the administration’s proposal as definitely a

top down.

Mr. HILL. In your view, Mr. Dennison, is there anything in the

administration’s proposal—it obviously stabilizes funding for local

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government schools, but does it do anything to build more stable

economies in your communities?

Mr. DENNISON. No, not at all, because you can’t separate the system. There is a system that is out there working. And as I quoted

from Mr. Coates, you can’t have one without the other; you need

the roads to get there. And again, we believe that—we believe the

administration, the Forest Service and Mr. DeFazio have the same

goals, but we just disagree on the way to get there.

Mr. HILL. There is no long-term solution?

Mr. DENNISON. The long-term solution has to be there. We already went through the northern owl proposal that went on and on

and on.

What I said a moment ago, just waiting for something to happen,

we can’t wait for it to happen. Five years is plenty long term to

wait for it to happen. We can work within that system with the

Forest Service and with others to get that developed on the ground.

And again, I want to emphasize that the Quincy Library Group

Adaptive Management Pilot Program is a start. We would like to

utilize that.

Mr. HILL. Going on, Mr. Dombeck, do you know whether or not

the administration requested full funding of the PILT program in

its budget this year?

Mr. DOMBECK. I really—I don’t know the answer to that. That

would come from—I believe from the Secretary of Interior, but it

is something we can sure check on.

Mr. HILL. Would it surprise you if I told you they didn’t?

Mr. DOMBECK. No, not at all.

Mr. HILL. One of the questions I have is, obviously you object to

the county coalition bill, and I think one of your objections is that

the offset of funds comes from within your budget, your agency

budget. I would understand why you would be concerned with that.

Where would the offset come for your proposal, for the administration’s proposal? Where would the funding come from for the payments to the counties?

Mr. DOMBECK. The pay-go difference is about $27 million a year.

We would—— Mr. HILL. Are you proposing that it be offset from your budget?

Mr. DOMBECK. From general revenues and—— Mr. HILL. From Social Security surplus?

One of the concerns I have is the impact of the forest management on poverty levels, and particularly in Montana. I just want

to make reference to some statistics because they are startling, Mr.

Secretary.

The unemployment levels and poverty levels in some of the counties in Montana, for example, Lincoln, Montana, which is, as you

know, Lincoln County, a timber-dependent community, 13.1 percent unemployment; Mineral County, 10.8; Sanders, 10.6; Granite,

9.0; Flathead, 7.9; Ravalli, 7.1.

But even more startling are the poverty levels that are in these

counties: Sanders County, 20.6 percent; Mineral County, 20; Powell

County, 19.6; Granite County, 19.4; Lincoln County, 18.3; Missoula

County, 16.3; Ravalli County 16.0; Flathead County, 14.4. The

President, I think, just toured some areas where we have high unemployment, substantial poverty.

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Do those statistics trouble you, that level of poverty in those timber dependent communities?

Mr. DOMBECK. Yes, they do. In fact, the county I grew up is in— is—although in a different part of the country, the Upper Midwest

is very similar in makeup to many of the counties in your State.

Mr. HILL. What is the administration’s proposal to diminish the

poverty in those counties?

Mr. DOMBECK. I did not come here prepared to talk about all of

the social programs that are out there, but what I would say in response to that is, the key thing that we need to do is settle down

the debate. Because the fact is that much of where we are today

is a result of public questioning, policies, court injunctions, and

those kinds of things that we deal with as, you know, we administer the laws and work through what we are required to do with

regard to the evolution of case law.

Mr. HILL. In your exchange with Mr. DeFazio you made reference to the fact that Congress sets the policy and you implement

the policy. You have been forest chief two years now?

Mr. DOMBECK. Yes.

Mr. HILL. During those 2 years has the Forest Service met its

ASQ’s?

Mr. DOMBECK. From the forest plans?

Mr. HILL. No, from Congress, the numbers that the Congress recommended.

Mr. DOMBECK. I believe reasonably close to what has been put

up. But the fact is that all of the timber sales that we put up are

not sold. Right now we have got about 5.8 billion board-feet under

contract, and an operator typically has a 3-year period where they

take a look at the broader economic conditions to make a determination as to whether or not they would harvest.

Mr. HILL. If I told you you were substantially lower than what

the ASQ’s were, would that surprise you?

Mr. DOMBECK. No. I guess I would say to differentiate that from

the amount offered versus what is actually sold.

Mr. HILL. One last point. We had a hearing a couple weeks ago

with regard to the fire catastrophe issue in the forest. I believe the

Forest Service asked the administration for $100 million in the

budget for dealing with the catastrophic fire issue and the administration proposed $65 million. Do those numbers seem correct to

you?

Mr. DOMBECK. I would assume they are reasonably close.

Mr. HILL. And GAO has suggested that you need $740 million a

year. Are you familiar with that?

Mr. DOMBECK. I like that number.

Mr. HILL. Would you—would it be your conclusion that $65 million is under funding the amount necessary to deal with the catastrophic fire?

Mr. DOMBECK. Yes. In fact, as we deal with the funding issues,

you know, there is—there isn’t a single forest supervisor or program manager that will tell me that they have enough money for

their program. And the thing, of course, that we struggle with is

balance, just as I know Congress struggles within the budget caps

as you look at, the various demands and how you balance allocation of the resources you have.

140

Mr. HILL. My point simply is, this is a way to help timber-dependent communities if we fully funded plus also deal with the fire

risk.

One last question for you, Chief, and that is this: I think you can

tell from this hearing, and I think you know full well that a pure

decoupling bill isn’t going to pass the Congress. I think you are

probably aware of the fact that we are not going to pass a bill to

increase timber harvest as well. Recognizing the fact that we have

got to get together, and this coalition is a sincere effort to try to

address that from the bottom up, are you willing to give your commitment to this Committee that you will work with us to try to

find a compromise and some middle ground on this issue?

Mr. DOMBECK. We will. In fact, as I look at the goals—I have listened to the other witnesses here. And, Congressman Boyd, I think

you know we have got—really have got much more in common than

we have—than we have differences.

Mr. HILL. We will then go to another round of questioning.

I guess Mr. Schaffer, you are recognized.

Mr. SCHAFFER. Thank you, Mr. Chairman. I also have questions

for Mr. Dombeck.

In your testimony—I am sorry I was not here to hear it, but I

was able to review it—you said that ‘‘Over the past 10 years timber

harvest in the National Forest declined 70 percent in response to

new scientific information, changing social values and our evolving

understanding of how to manage sustainable ecosystems.’’

First, what new scientific information are you referring to?

Mr. DOMBECK. Well, I think one of the things we do have in the

United States is the best science and technology in the world as we

take a look at the various concerns. But if we take a look at issues,

as Mr. Spain talked about, with regard to salmon fisheries, with

sedimentation, with items like that, I think we are, you know, we

are moving away from the era of large clear-cuts to more selective

management.

I was down in Arizona not long ago on the Apache-Sitgreaves

National Forest where they are talking about concepts of forests to

deal with fire risk, and in that situation, they are harvesting virtually everything below 16 inches to reduce the fuel. They are marketing wood down to about 5 inches, utilizing other—the remainder

for fire wood and other uses like that, and very selectively harvesting some of the larger trees as we try to move toward a more

healthy condition with the appropriate stand densities and items

like that.

So the breadth—my point is the breadth of the science that we

have out there is expanding significantly and continues to expand.

For example, in the State of Idaho where, you know, we now have

Western white pine disease resistant strains developing, so we are

working on reforesting parts of the northern Rockies with white

pine.

We have got—white bark pine is another species that is important to grizzlies.

We have the long leaf pine in the Southeast that we are reforesting much of that, but only about 3 percent of the original long

leaf remain.

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I think if we take a look at the Allegheny with the quality of

cherry that we have on Allegheny today is some of the best quality

hardwood in the world. You know, we didn’t have that 50 years

ago.

Another important area of research that we shouldn’t forget

about when we talk about local communities is to do as much

value-added work in those local communities as we possibly can,

and that is—a lot of work has been done to increase the efficiency

of use of wood that is out there through the particle board technologies, the resin technologies, the work that is done by our own

forest products—— Mr. SCHAFFER. So you are persuaded that all of this scientific information, the things that you mentioned, is what has resulted in

this 70 percent reduction?

Mr. DOMBECK. No, not at all. That is part of it. Much of it is—— Mr. SCHAFFER. The General Accounting Office study said that

their 40 million acres of forestland are at high risk of catastrophic

wild fire. What role did that kind of scientific information play in

your opinion?

Mr. DOMBECK. Well, we are very, very concerned about the fact

that there is 40 million acres at risk. And we need to make investments to reduce the fuel loadings to apply whatever science is appropriate for whatever watershed to deal with that issue. And I

think there is lots of agreement in this room that we need to get

on with that and make those investments.

Mr. SCHAFFER. Would it be possible for you to elaborate on that

further, in writing perhaps, as to what kind—as far as that particular statement that was made in your opening comments about

the scientific information that has helped result in a 70 percent reduction in timber harvest in the United States, which ultimately

led to the financial problem that we are trying to deal with today.

Mr. DOMBECK. I would also like to highlight that a large part of

that was also a result of litigation.

Mr. SCHAFFER. You also mentioned social values. What kind of

social values led to the 70 percent reduction in timber harvest?

Mr. DOMBECK. The tremendous increasing recreation use that we

see on national forests. The increasing concern of water and watershed values. We have got 3,400 municipal watersheds within the

national forest that provide drinking water to about 60 million people. All of those values, cultural values, archeological values, a

wide variety. And I would also be happy to elaborate on that in

writing in more detail because that is a topic that we could talk

about here until dark and beyond.

Mr. SCHAFFER. Does the Forest Service use sound scientific practices or opinions, as defined by social pressures or social type

issues?

Mr. DOMBECK. One of the things that came out of the debate in

the Pacific Northwest and the owl issue that I know Mr. DeFazio

is well aware of, as well as the people at the table here, is watershed analysis procedures that take a look at the overall function

of watersheds, watershed management, ways to reduce sedimentation, increase function of riparian areas, again, the contribution

that roads make and the condition of roads, the need to maintain

roads to a particular standard to reduce or prevent sedimentation,

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road crossings. Again, it is a very complex issue with lots of pieces

involved.

Mr. SCHAFFER. I have one more question. I am trying to beat

that yellow light there. That is with respect to the Department’s

proposal on the Stabilization Act of 1999, the second point that you

mentioned in your testimony, is to provide increased payments

above the payments projected under the current law to compensate

States for national forest lands that are not available to the local

tax base.

Is that increase in payments, is that—is there a figure laid out

for that over the long term? Because with the projected decline in

fund payments of a 25 percent fund, you are proposing to do better

than the declining number there. Or is there a stabilized expenditure that you have in mind that would actually increase something

on the order of—I don’t know, even keeping pace with inflation, I

suppose.

Mr. DOMBECK. The proposal is to stabilize it at $270 million.

Which is about—— Mr. SCHAFFER. That is the light blue line.

Mr. DOMBECK. Which is about $27 million more than 1998, nationally.

Mr. SCHAFFER. Thank you, Mr. Chairman.

Mr. HILL. I thank the gentleman.

Mr. DeFazio.

Mr. DEFAZIO. Thank you, Mr. Chairman. I was pleased to hear

the Chairman engage the Chief in some dialogue about potential

for working together and compromise, because I believe we—you

know, the utmost importance that we get a guarantee, whether it

is 5-year, 10-year or permanent, at least an extension out of this

Congress, preferably more than 5 years.

And going to the issue of 5 years, Mr. Douglas, I am curious why

the coalition chose this 5-year figure for the guarantee. And I go

to your testimony and you say, ‘‘We strongly believe these recommendations can and should be formulated in the first 3 years of

the safety net.’’ okay. That is, you know, not unreasonable, that a

group of people could get together and come up with some recommendations, which of course are not binding.

But then it says, ‘‘It is further our belief that these recommendations should be enacted into law within 2 years of their receipt by

Congress.’’

Have you been watching this body lately? I mean, no offense, we

should——

Mr. DOUGLAS. My expectations irrespective of the past performance.

Mr. DEFAZIO. Really, a point to that is the 5 years as a potential

problem. I think it may be partially the perspective of counties that

don’t have guarantees now who are going to be ahead during the

5 years and counties that do have guarantees now who are looking

at a cliff. That is part of the difference I think of perspective. From

my counties, we are looking at the cliff and we have been the most

public timber dependent historically in the past.

The other thing I raise a question about is why you would take

the money—I know the chairman went to the issue here, we funded the guarantee by finding a tax break that was used by log exVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00146 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
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porters and rescinding that tax break, the current guarantee. And

as I understand that has now gone back into place.

So I think there are some interesting places we could look for

revenue offsets to meet the chairman’s concern that it doesn’t come

out of Social Security, which I share. But to take it out of Forest

Service budget—and I will ask you a question in a second, but let

me give you my perspective—I don’t think Forest Service has

enough money today to do what we are asking them to do.

You know, the surveys that the Chief referred to not only go to

streams, down to class three, but they also go to wildlife that only

shows up or is detectable at certain times of the year in terms of

mating. And that—I really find that, in part, the frustration the

chairman and others had about the implementation of the Clinton

forest plan has gone to the fact that they haven’t been able to complete all these surveys.

I really don’t think we should look at cutting their budget to fund

guarantees to counties. I would hope this would be an area where

we might seek some compromise if we could find another revenue

source. Is that possible, do you think?

Mr. DOUGLAS. I think we have several possibilities here. First of

all—we believe that the bill, first of all, doesn’t say that the Forest

Service has to cut their budget. The bill says the revenues can

come out of appropriations and can come out of revenues. Now, if

one assumes that revenues are a fixed pie and we can’t do anything

about that, then that leads us to severe encroachment, in some people’s minds, on the Forest Service’s budget. With respect to that,

you have a $3.4 billion agency; and our costs for doing this above

the current owl payments are about $200 million or so.

We don’t see this as a sizable encroachment upon this agency’s

ability to manage, especially when you take into account the fact

that they have at their disposal a renewable resource that needs

considerable work. And some of that is fuel reduction, a substantial

fuel reduction all across the United States.

The last time I testified before this Committee, I held up the

map that is behind me—and I know you are familiar with it, so I

won’t do it again—that has—in addition to this 40 million acres

that we have talked about being catastrophic fire danger, we are

proposing that that number of acres the Forest Service itself has

will be suffering greatly from trees dying, the total amount being

58 million acres. We believe if we just do the appropriate forest

health management and fuel reduction work in the near term that

that does not have to be the kind of encroachment on the Forest

Service’s budget that would happen if we do nothing.

So I think we do have some compromise points, Congressman,

that we can certainly work on.

Mr. DEFAZIO. Thank you, Mr. Douglas, on that point. I guess

now I am running out of time, but I just want to make a point here

I made to my counties, I made to NACO. I was a county commissioner; I served on the NACO National Resources Committee when

I was a county commissioner. Judge Dale White from Oregon, from

the other side of the aisle, was a tremendous chairman of that committee and, you know, has recently retired after many years of

service.

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But I have to tell you we did not drive Federal forest policy. All

the resolutions and all the things we adopted, you know, had this

much impact on Federal forest policy. The counties, the schools together are not going to drive Federal forest policy. I think it is a

divisible question. We can and will have the debate ongoing over

Federal forest policy in this Committee and maybe on the floor of

the House for years to come. But I just want to urge everybody, you

know, for the sake of the counties and the services and the schools

and the kids to keep their eye on the money and be flexible in how

we go forward and get a bill adopted this year. Because I think if

we go into the presidential election year, we are not going to get

a bill. And then we are that much closer for my county, the precipice, and two more years into lack of resources in your county.

So thank you, Mr. Chairman.

Mr. HILL. I thank the gentleman.

Mr. Sherwood.

Mr. SHERWOOD. Thank you. This weekend I was reading ‘‘Breaking New Ground,’’ Gifford Pinchot’s book, and we seem to talk here

as if the science of good forestry management is something new. He

went to Europe to learn it in the last century, and then came back

and set up the original BL forestry school in Milford, Pennsylvania.

And he talks with great zeal in there about the perfectly managed

European forests and how they had communities that depended on

them and created this sustainable resource.

So, this, while we are—somebody said, We wish it was as easy

as rocket science. It is a moving target. It is more difficult. It is

not exactly new. And we have all these timber companies in the

country that manage forests and make money at it. And the United

States owns these huge reserves. And I think that is what the people from the forest counties are here telling us, that if we, through

national policy, would direct the Forest Service to run those like a

business, there would be money to go around.

Now, we have more problems than that, right, Mr. Dombeck?

Mr. DOMBECK. I have got all I can handle right now, but, yes,

there is lots of debate over the issue.

Mr. SHERWOOD. Would you say—what would be your comment,

what has the endangered—what has been the result on the health

of our national forests on the endangered species laws?

Mr. DOMBECK. Of course, it has added much to our work load

with regard to the surveys, the compliances that are required and

all of those kinds of things that we do with regard to unit costs for

operation, as have legislation like the Historic Preservation Act

and other kinds of things. But I would just reaffirm that the larger

objective of this is to maintain the integrity of the watersheds of

the habitats and the forest health. And I have stated my opposition

many times to zero cut.

The fact is, we do need to do work out there. But I want to also

point out, in many cases, much of the 40 million acres at risk that

we talk about, the values are not there to carry the cost to management because the overstory has been removed some time ago, and

we have—through total fire suppression, we have got, you know,

high fuel build-ups and we result in the whole debate of low cost

timber sales which, you know, in my view we should—we ought to

focus on what we want on the land rather than—because if the valVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00148 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
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ues aren’t there, that doesn’t mean that we should let the forest

health conditions continue to persist.

Mr. SHERWOOD. I certainly agree with that. But it would seem

like the money that is realized from selling very valuable stands

could be used to used to do timber stand improvement work in ones

where you need to reduce the fuel load.

A comment that you made and I am looking at my—we are talking about water quality? And do you agree that well-managed forests and water quality go hand and hand?

Mr. DOMBECK. Exactly. In fact, the cleanest water in the United

States is coming off of our forests.

Mr. SHERWOOD. Sure. And you know the big water companies in

the East have huge timber holdings because that is how it works.

But you were talking about—did you say in Arizona where you are

cutting everything 16 inches and under?

Mr. DOMBECK. That is, project pilots that are being tried. There

are a lot of different things that are being tried around the country.

I think one thing as we continue the dialogue here in Washington,

I always feel the more we can get out in the woods and the forests

and look at things, the more we will arrive at an agreement as to

what management should be. Because it really focuses individuals

on the land and what we want on the land versus, you know, an

economic debate or a debate about education in the sense of how

we fund education which is part of what we are talking about here.

Mr. SHERWOOD. I understand you are thinking about decoupling

it. But our opposition to decoupling it is, then it takes away the

pressure to manage the resource. And it also takes away the incentive to keep these gentlemen’s communities viable and working.

And we just send them a check and forget about them. Well, that

is not what they want and that won’t work well in the long run.

And I don’t know how we get to the issue where we can get your

foresters back to doing what they do best, managing forests. And

I think that is the dialogue we have got to have.

Mr. DOMBECK. I would like to just do, while we are sort of philosophizing, is make a couple of points.

If we take a look at the public domain lands over the history of

the United States where we started out with 1.8 billion acres outside of the 13 colonies—and that includes Alaska, the Gadsden

Purchase and so on—and this land was used for a variety of things

over time; you know, for example, if you would have been a lieutenant general in the War of 1812 and you retired from service you

wouldn’t have got a monthly check, you would have received 1,100

acres of land. If you were a private, you would have gotten 160

acres of land. So the land, in essence, was the wealth of the Nation.

We didn’t have to have an income tax. We went through the homestead era and then again the establishment of the national parks,

some of the watershed problems that led to the establishment of

the national forests that led to the Taylor Grazing Act.

The values of what the public cherishes, national forests and

public lands today, you know, are well beyond what they were, say,

at the turn of the century. And again my point is if the contribution of national forest to the gross domestic product is something

in the neighborhood of $123 billion a year, that comes from a variVerDate 11-MAY-2000 13:28 Feb 14, 2001 Jkt 010199 PO 00000 Frm 00149 Fmt 6633 Sfmt 6602 E:\HEARINGS\59858 pfrm08 PsN: 59858
146

ety of areas—you know, recreation, hunting and fishing opportunities, value added in local communities, hotels, vacations.

We have got 3,000, you know, mining operations on national forests. We have got, you know, as I said, 5.8 billion board-feet of timber under contract today. Wouldn’t it seem that we should look

more broadly as we look into the 21st century rather than stay tied

to the controversy that we are subjected to as—I can give you another example.

In my first 3 months in this job we have about $26 million worth

of timber sale enjoined in Texas. Well, imagine, there sits the

school system in five counties, I believe it was, with $5 million they

are not going to get. And it is not my decision. It is not the decision

of Congress, or the administration’s decision. It is the judicial process and the litigation and the controversy associated with these

issues that holds these social services subject to this uncertainty.

And how do we get beyond that? Do we get beyond it by tying

ourselves more to the controversy? Or do we look for more common

ground in the broader values? I think, in fact, this is a very good

dialogue for us to be having here as we work our way through what

the best opportunities for solutions are.

Mr. SHERWOOD. Just one.

Mr. HILL. One last question.

Mr. SHERWOOD. But it seems obvious to me if the people who live

in those areas had faith, that that would work for them, they

would just say, send us a check. But I think they have more faith

in free enterprise and old-time values, so to speak, and they want

us to keep the pressure on the system. And my short experience

around here would say that we need to keep the pressure on the

system.

Mr. HILL. I thank the gentleman for the comment.

Just following on, Chief Dombeck, we do need to get beyond the

controversy. But Congress created this maze of conflicting instructions and values and Congress can straighten that out. I mean,

Congress can move this from the judiciary by clarifying what its intention is.

Now, the problem is that Congress isn’t necessarily of a single

mind in how it might want to get that done. But let’s talk about

that for a minute, because there is a model out here, the Quincy

project.

Now, originally the Forest Service didn’t support Quincy legislation, and then later did support it. I think it passed by an overwhelming margin. One of the things that the coalition’s bill intends

to do is to try to bring that model to the long-term solution of how

we manage the resource. Why do you object to that?

Mr. DOMBECK. I guess I am not sure what specific parts, you

know, of the model you are talking to. We are working diligently

to implement the Quincy Library Legislation through the process.

And, you know, as I understand it, our employees in California are

making good progress at that.

Mr. HILL. I am talking about taking the concepts that are

imbedded in Quincy, getting a broad spectrum of people, this broad

coalition of 500 groups, counties and interests together to help recommend to the Congress and to you a long-term solution to the

147

controversy associated with the management of the forest. What is

wrong with that?

Mr. DOMBECK. I don’t think there is anything wrong with that.

In fact, I think that is what we are doing right here in this process.

And as I see it, the goals that we have identified here, there is a

lot more agreement than there are differences.

Mr. HILL. So you don’t object to that element of the coalition’s

bill that would create an advisory group to study this issue and

make recommendations to you and to the Congress in terms of how

we can address this conflict in values with regard to the forest

management?

Mr. DOMBECK. My understanding—and I will ask Sandra for

some help here, is that advisory group also makes, in a sense, resource management decisions.

Mr. HILL. It makes recommendations. It doesn’t make any decisions in the bill.

Mr. DOMBECK. Okay, makes recommendations. And given the

complexity of issues and laws that we have to deal with today, is

one more layer going to make it easier for us? Is there anything

on the detail?

Mr. HILL. So the question, now, I am asking you, do you object

to that or do you support that? It is one or the other. Do you support that provision of the bill or do you object to that provision of

the bill?

Mr. DOMBECK. I object to it as I understand it to be now. But

I am certainly willing to take a second look to talk about—look and

see where the middle ground is from the stand point of how we implement it.

Mr. HILL. Mr. DeFazio’s comments were, we can compromise on

this if we just give up the long-term solution. These communities

want to have forest management in a way that sustains the forest,

sustains the health of the forest, and sustains their economies.

Your recommendation doesn’t do that nor does Mr. DeFazio’s bill.

It continues the controversial conflict-based process we have today.

We are trying to find a way out of that.

We are saying that the Quincy model is a model that we could

draw upon to help the Forest Service get through this. The question is, do you support the idea of using that model for a broader

discussion than just the issues that were addressed in the Quincy

project?

Mr. DOMBECK. I certainly support looking at it. As I see the

things that are happening around the country, there are—I think

for us to look at the array of models that are out there and to pick

the best from each, I think is a very wise thing to do.

Mr. HILL. So you could support then an advisory group that

would operate under that kind of a scenario to make recommendations to you and to the Congress for a long-term solution; is that

what you are saying?

Mr. DOMBECK. Certainly in concept. But again, as I see it—— Mr. HILL. You know, we will talk about that, just a concept. We

are trying to get to common agreement here. If we could get that

far, it would be great.

Mr. Douglas, you brought together a diverse group of people. It

is an impressive group. How did you get that done?

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Mr. DOUGLAS. We essentially sponsored a couple of national conferences, our school coalition in California, the 39 counties, because

we had this basic hypothesis that there were a lot of people like

us across the Nation who were struggling with this issue, both

county and school people. The hypothesis proved to be very true.

And in fact, as people have gotten to know about our coalition, they

have flocked to become a part of it.

When I appeared before you a little over a month ago, we had

386 members. We have over 500 now. We are not having to convince people from forest counties—both school people, county supervisors, people from chambers of commerce, people from business,

people from labor—we are not having to convince people to do this.

This is, very frankly, Mr. Chairman, the easiest sell that I have

ever had.

Mr. HILL. This issue goes beyond just payments, it goes beyond

just schools?

Mr. DOUGLAS. Yes, it does.

Mr. HILL. Do you want to elaborate on that?

Mr. DOUGLAS. I did in my written testimony, and I touched on

it in my oral testimony. The coalition strongly believes that both

the short-term solution, the infrastructure piece, needs to be taken

care of immediately because of the serious needs and the fact that

we have gone a decade in these communities with the deterioration

happening that has. There is substantial and serious needs.

There is also a high level of eroded trust in forest counties, both

in county governments and the citizens of forest counties relative

to the faith that people in Washington and the Federal agencies

will truly do something about this. The idea of accepting the decoupling proposal and separating forest management issues from the

support of schools and county government is not something that

people in our coalition have a high level of trust in. One of the reasons that we set up the proposal the way that we did was to rebuild that trust. And I would emphasize what Bill Dennison has

indicated here, one of the ways of doing that is through local management collaboratives such as the Quincy Library Group.

We also believe that having a focused, over the next 3 to 5 years,

discussion looking at the best science, looking at what we have

learned in terms of working together to find the middle ground

that is scientifically based and good management; we believe in

strong forest health is the way to do this. And we think that both

of those have to be part of the solution.

As I mentioned before, this is a systemic problem that we are a

complex social and ecological system in our forest counties. You

cannot tease that apart and try to solve one piece of it without taking on the entire system. It is a systems issue from our point of

view. You can do that in logic, in sound bites, and on paper; but

in reality, you can’t solve a piece of the system. You have to do it

in a wholistic systems kind of way, and that is the reason that we

have proposed what we have.

We don’t propose to have the solution to the long-term. There are

those saying that the forest coalition is advocating to returning to

the highest levels of cuts of the late eighties. You will not see that

in any of the material we put out. We believe in having healthy,

sustainable, national forests. We live there, and we want them

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there. And we believe that can be done. We believe also revenue

can be generated from those forests and that we can have stable

communities, healthy national forests, and we can have healthy

and vital families living in those communities that we as educators

have to work with to provide services to. Those are inextricably entwined.

Mr. HILL. That is why you oppose decoupling?

Mr. DOUGLAS. That is correct.

Mr. HILL. Mr. Dennison, do you care to comment on that?

Mr. DENNISON. I would agree with everything that Mr. Douglas

said. We want to move forward and work with the administration,

we can do the job that will be economically and environmentally

sound, and we all can win.

Mr. HILL. This is not about going back to the 1980 timber-harvest levels or clear-cutting forests.

Mr. DENNISON. Not at all. The chief talked we will never get

back to the 11 billion board-feet again. We may not, but we should

do much better if we just take care of what is happening out there.

We are at 3.4 billion board-feet or so now. There is no reason to

expect that we should not be able to double that and do it within

a sound environmental context.

Mr. HILL. I guess one last question. Chief Dombeck, on your 25

percent fund-payment trend projecting forward to the years 2000

through 2004, you suggest a 25 percent reduction in harvest.

Should I read into this that we are going to see a further 25 percent reduction in harvest on the Forest Service lands over the next

4 years? Is that what your plan is?

Mr. DOMBECK. That is our projection based on the issues that we

have to deal with. The issues like, for example, the potential listing

of the Canada lynx, other kinds of things that we see, other fisheries that are at risk, other things like that.

Mr. HILL. Do you find that acceptable that we are going to see

a further 25 percent reduction in timber harvest? Is that compatible with what you think that we ought to be accomplishing?

Mr. DOMBECK. Again to rely on the inventory and analysis, the

forest risk mapping that we have done, I think provides us more

and better information to do that. But we really need to let watershed by watershed, timber stand by timber stand tell us what the

harvest levels should be.

Mr. HILL. I am not disagreeing with that. Do you believe that

that level is a satisfactory—is this created by external causes or is

this a consequence of the internal policy, the decisions of the administration and implementation of policy?

Mr. DOMBECK. Let me ask Sandra to elaborate on this since she

was involved in putting this together.

Ms. KEY. It is interesting that you ask this because this is one

of the things that several have said, why these trends and where

are they coming from?

Yes, we think there are many things going on in terms of these

large ecological issues that we are dealing with. But the estimates

are a combination of our experts, if you will, looking at market

trends, what species are selling, what the prices are that they will

get, and what our budgets are going to be with as much accuracy

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as we can predict them and what that will do to our timber program.

Mr. HILL. Do you think this is good?

Ms. KEY. Do I think it is good or Chief Dombeck?

Mr. HILL. Chief Dombeck, are you satisfied that these are satisfactory levels?

Mr. DOMBECK. Not necessarily.

Mr. HILL. It is kind of a fudge?

Mr. DOMBECK. For me to say a yes or no, what I have got to do

is rely on the science and the experts as we blend the needs of local

communities with the best information that we have.

Mr. HILL. Obviously the Forest Service sets timber sales which

are interrupted by court decisions. My question is are these declining harvests a consequence of external factors or internal decisions

on the part of the Forest Service?

Mr. DOMBECK. Based upon Sandra’s comments, likely a combination of both.

Mr. HILL. Okay. Mr. Schaffer, I think you wanted a second round

of questions.

Mr. SCHAFFER. Thank you, Mr. Chairman. I had some other

things that I wanted to ask, but you really put your finger on some

interesting topics. I just want to continue on with that. This is a

frustrating conversation frankly because I understand the Endangered Species Act and management practices. They come up in—

I am sorry, I missed your name.

Ms. KEY. Sandra Key.

Mr. SCHAFFER. As Ms. Key indicated, the marketability of certain

species and what the market bears. But the answer to that question that the Chairman just asked, is this satisfactory and is it

moving in the right direction, I can’t accept the head of the Forest

Service saying gee, that is just kind of the way that it is.

You know, this is a time when we really need some passionate

leadership out of the Forest Service in helping to direct the direction of our country and send the message up the chain and to the

administration as to which direction we ought to go.

I would really hope, my goodness, you have one of the greatest

national assets that our country possesses in terms of a resource

and a resource base. You have probably some of the most enthusiastic energy that you have among local elected officials. And it

seems like everything is there to make for an economically viable

operation that maintains and sustains the health of our national

forests but at the same time increases the ability for us to see real

progress on clean water and at the same time increases the revenue necessary to, as a result of that relationship and the energy

at the local level, to find more cash for schools.

I am curious, the other committee meeting I am missing right

now is the other committee I serve on, which is the Education

Committee where we scratch our heads every day wondering how

we are going to get more dollars to classrooms. And the great debates between the executive branch and the legislative branch

about how to get more dollars to classrooms, hiring a hundred

thousand new teachers, where does the Forest Service come in

these discussions? Do you get calls from the White House that say

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how can you help us squeeze more dollars out of your particular

agency to help in this problem?

Mr. DOMBECK. With the education issue?

Mr. SCHAFFER. Yes.

Mr. DOMBECK. I don’t get calls from the White House asking

about that, but we have had hearings on the Youth Conservation

Corps programs and other things like that which contribute to understanding of that. And, of course, our employees do a lot with regard to presentations at local school districts and a variety of programs like that.

The one thing that I do want to comment on with regard to the

question of the graph and then the timber harvest, part of the

problem is that we are just focused on one resource. If we take a

look at the recreation trends and the other use trends on the national forests, they are all up. As I said to begin with, I think

where we are as a society, is we are taking a look at a different

balance and there is debate involved in how we achieve that different balance.

Timber harvest is a very, very important part of that. But I find

it fascinating that as we take a look at 1.7 million vehicles on Forest Service roads associated with tourism and recreation, I ask myself, why is it that we are just talking about timber? Timber is important, but how is it that we capture the other values that are out

there as society looks at them.

Mr. SCHAFFER. Have there been any proposals from the Forest

Service on how they can achieve their goals and do so in a way that

helps maintain a traditional level of funding that we have built

into school budgets and county budgets for years?

Mr. DOMBECK. I think if we look at the variety of things that are

on the—proposed through the appropriations process where we look

at soil and water programs, recreation programs, at maintaining

the infrastructure at national forests, we are making significant investments in forest health issues, and we are looking at a variety

of pilot projects. There is an awful lot of work that needs to be done

in your State with regard to forest health. We are looking at investments in wood technologies to provide markets for lower value

woods to secondary markets. The value added, a variety of things.

Mr. SCHAFFER. I think we are moving off the subject here a little

bit, and that is you have greater amounts of recreation in national

forests and other activities which represent some level of value that

is taking place. Has tapping into that economic enterprise or portion of the national forest revenue for the benefit of school districts

and forest counties been a part of your proposal? Has there been

some effort on behalf of the Forest Service to include using that

economic engine to help?

Mr. DOMBECK. I think what we do by proposing a stable level,

a mandatory level that—that spreads the source.

Mr. SCHAFFER. But those funds are not derived exclusively from

the management of forests. It comes from seniors and kids through

the general fund budget. That is the problem here. This decoupling

effort is not a good idea.

I think what we are hearing from local governments is that

maintaining this close relationship between active management

and sound management for economic and environmental objectives,

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utilizing the expertise of those who live in these areas, is a better

formula. It is one that helps bridge this span between Washington,

DC and Oregon or California or Colorado.

What I see is these folks to your left trying to maintain that relationship, and I see you trying to suggest, let’s separate the economic benefits from the economic activity and fund it through the

general fund budget. I think they are right.

Mr. DOMBECK. And I appreciate your judgment on that.

Mr. SCHAFFER. I wish you would appreciate their judgment, too.

Mr. DOMBECK. We do, and the reason we are here is to continue

the dialogue.

I do want to respond to another one of your points and that is

what are we doing with the 40 million acres. The fact is we are on

a trend to have that taken care of by 2015, and by the year 2003

we hope to be treating 3 million acres a year as we begin to work

down that backlog. So there is a—significant progress has been

made. We have a lot more to do. There is a plan and an approach.

We bring that to Congress each year for you to fund.

Mr. HILL. The gentleman’s time has expired. I think this has

been a very interesting hearing.

First of all, Chief Dombeck, I don’t think anybody here disagrees

with the fact that we understand that there is a different balance.

We want an ecological and economic balance as well. I think if you

have read any of this testimony, everybody here agrees with that,

and nobody here believes that the only purpose of the forest is for

timber harvest. I don’t think that anybody has made that claim or

that case.

We care deeply about the forest, every bit as much as anybody

in the Forest Service does. We also value the tourism and the recreational opportunities, both in terms of those personal experiences

as well as the economic aspects of those. That is why we have

talked to you about road closures and our conflict about a top-down

transportation policy of the administration. And there are other

values, motorized vehicle use and berry picking and hunting and

all of the things that we have been here to advocate for.

So I don’t think that anybody here in this hearing room disagrees

with you about that. I think that managing the catastrophic fire

risk is one way to help strengthen the economies of those communities. But I will tell you what the GAO testified to a couple of

weeks ago is that you don’t even have a team in place or a leader

to develop a strategy for dealing with this risk.

Thirty-nine million acres are at risk. You won’t even begin to address that risk by the year 2025 unless you ask for substantially

more funds than you are asking for now. You are treating more

acres, but you are treating the acres that really don’t count. The

at-risk acres are being neglected by the Forest Service, and that is

supported by the internal documentation of the Forest Service.

The one thing that I think has come out of this hearing, we need

to find a safety net for these counties. We need to find a revenue

source, and we have to agree to a term.

Decoupling is not going to happen, Chief Dombeck. It is not going

to pass this Congress so we have to set that aside and figure out

how to deal with this issue. We need a long-term solution to diminish these external factors that are driving your decision-making

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process, and we need a collaborative policy and effort to help try

to improve how we deal with this issue and you do.

I hope that you can come away from this hearing having heard

that and we can work together to draft legislation to help these

counties and these communities.

With that, the hearing is adjourned.

[Whereupon, at 4:50 p.m., the Subcommittee was adjourned.]

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