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94–052 2016

S. HRG. 114–262 

IMPROVING FOREST HEALTH AND SOCIOECONOMIC OPPORTUNITIES ON THE NATION’S 

FOREST SYSTEM 

HEARING 

BEFORE THE 

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

ON 

IMPROVING FOREST HEALTH AND 

SOCIOECONOMIC OPPORTUNITIES ON THE 

NATION’S FOREST SYSTEM 

MARCH 24, 2015 

( 

Printed for the use of the 

Committee on Energy and Natural Resources 

(II) 

COMMITTEE ON ENERGY AND NATURAL RESOURCES 

LISA MURKOWSKI, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

JAMES E. RISCH, Idaho 

MIKE LEE, Utah 

JEFF FLAKE, Arizona 

STEVE DAINES, Montana 

BILL CASSIDY, Louisiana 

CORY GARDNER, Colorado 

ROB PORTMAN, Ohio 

JOHN HOEVEN, North Dakota 

LAMAR ALEXANDER, Tennessee 

SHELLEY MOORE CAPITO, West Virginia 

MARIA CANTWELL, Washington 

RON WYDEN, Oregon 

BERNARD SANDERS, Vermont 

DEBBIE STABENOW, Michigan 

AL FRANKEN, Minnesota 

JOE MANCHIN III, West Virginia 

MARTIN HEINRICH, New Mexico 

MAZIE K. HIRONO, Hawaii 

ANGUS S. KING, JR., Maine 

ELIZABETH WARREN, Massachusetts 

KAREN K. BILLUPS, Staff Director 

PATRICK J. MCCORMICK III, Chief Counsel 

LUCY MURFITT, Senior Counsel and Natural Resources Policy Director 

ANGELA BECKER-DIPPMANN, Democratic Staff Director 

SAM E. FOWLER, Democratic Chief Counsel 

BRYAN PETIT, Democratic Senior Professional Staff Member 

(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Murkowski, Hon. Lisa, Chairman, and a U.S. Senator from Alaska ................. 1 

Cantwell, Hon. Maria. Ranking Member, and a U.S. Senator from Washington .................................................................................................................... 3 

WITNESSES 

Bonnie, Robert, Under Secretary for Natural Resources and the Environment, 

U.S. Department of Agriculture .......................................................................... 5 

Brown, Brian, Director, Alcan Forest Products LP .............................................. 19 

Owen, Carlton, President and Chief Executive Officer, U.S. Endowment for 

Forestry and Communities, Inc. ......................................................................... 45 

Peck, Mark, County Commissioner, District No. One, Libby, Montana ............. 68 

Vaagen, Duane, President, Vaagen Brothers Lumber Company ......................... 76 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED 

Bonnie, Robert: 

Opening Statement ........................................................................................... 5 

Written Testimony ............................................................................................ 8 

Responses to Questions for the Record ........................................................... 112 

Brown, Brian: 

Opening Statement ........................................................................................... 19 

Written Testimony ............................................................................................ 34 

Responses to Questions for the Record ........................................................... 139 

Cantwell, Hon. Maria: 

Opening Statement ........................................................................................... 3 

Dahlstrom, Kirk: 

Statement for the Record ................................................................................. 20 

Intertribal Timber Council: 

Statement for the Record ................................................................................. 143 

Owen, Carlton: 

Opening Statement ........................................................................................... 45 

Annual Report 2014, Investing for Impact ..................................................... 46 

Written Testimony ............................................................................................ 57 

Responses to Questions for the Record ........................................................... 134 

Murkowski, Hon. Lisa: 

Opening Statement ........................................................................................... 1 

National Association of Home Builders: 

Statement for the Record ................................................................................. 90 

Peck, Mark: 

Opening Statement ........................................................................................... 68 

Written Testimony ............................................................................................ 70 

Responses to Questions for the Record ........................................................... 137 

Salt River Project: 

Statement for the Record ................................................................................. 146 

Vaagen, Duane: 

Opening Statement ........................................................................................... 76 

Written Testimony ............................................................................................ 78 

Responses to Questions for the Record ........................................................... 141 

(1) 

IMPROVING FOREST HEALTH AND SOCIOECONOMIC OPPORTUNITIES ON THE NATION’S FOREST SYSTEM 

TUESDAY, MARCH 24, 2015 

U.S. SENATE

COMMITTEE ON ENERGY AND NATURAL RESOURCES

Washington, DC. 

The Committee met, pursuant to notice, at 10:03 a.m. in Room 

SD–366, Dirksen Senate Office Building, Hon. Lisa Murkowski, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

The CHAIRMAN. Good morning. We are calling to order the Energy Committee hearing this morning. Welcome everyone. 

We are here today to review the management of our national forests and what we can do together responsibly to make them 

healthy and productive for the people who enjoy them and who rely 

on them. 

Over the last 20 plus years the management of our forests, and 

I would probably say reluctantly the lack of management thereof, 

has resulted in a crisis of epic proportions for local communities. 

According to the Forest Service’s own statistics there are 

65,000,000 to 82,000,000 acres in need of some kind of restoration 

treatment, because they are at high risk from severe wild land fires 

that threaten human safety and ecosystem integrity. 

I noted in my hometown newspaper just over the weekend that 

with the low snow pack, low precipitation over the winter and probably an early spring that we are looking at an early and perhaps 

an extensive fire season. That does not make us feel too good up 

there. Mr. Bonnie, you know what I am talking about. 

Of the acreage that requires restoration treatment, 12-1/2 million 

acres require some level of mechanical treatment to thin overly 

dense stands. Nearly 18,000,000 acres of conifer trees have been 

lost to bark beetle alone and recently the Forest Service designated 

45,000,000 acres as insect and disease epidemic areas in need of 

treatment at the request of governors under the 2014 Farm Bill. 

A million and a half of those acres are in my State of Alaska. 

At the same time the annual timber cut has dropped by more 

than 80 percent resulting in the loss of tens of thousands of timber 

jobs, closed schools and local government budget shortfalls. 

The Secure Rural Schools program provided a temporary lifeline 

to timber dependent communities, but in these tough budget times 

2 

paying for it is increasingly difficult and the prospect of simply continuing to make payments from the Federal Treasury is increasingly unsustainable. 

The California loggers who visited my office last week had it 

right. American forests work only if they do. 

Now there are many factors that have contributed to where we 

are with this crisis situation. The policies that govern our national 

forests have evolved over time to reflect new, sometimes competing, 

priorities of a changing society. Policy makers and the Forest Service have not done a very good job of effectively integrating the body 

of laws, regulations and court decisions so there is no clear guidance for the management of our national forests. Still gripping the 

Forest Service is what former Chief, Dale Bosworth described as 

‘‘analysis paralysis.’’ 

This maze of congressional mandates, Administrative directives, 

executive orders, Secretarial memos and court decisions is a mine 

field of litigation opportunity as some have only been too eager to 

exploit. Progress today has been redefined to be the completion of 

the process rather than implementation of a project on the ground. 

Southeast Alaska is a case in point. Its forest industry, once the 

second largest in the state, is barely hanging on. We have one medium size sawmill that is left. 

In 1990, a decade after passage of the Alaska Lands Act that cut 

Federal timber harvest in Southeast Alaska by more than half, 

timber accounted for 6,113 direct and indirect jobs or 79 percent of 

all manufacturing jobs in the state. By 2000, due to a host of restrictive factors like the 1990 Tongass Timber Reform Act and the 

Inventory Roadless Area Rule, timber accounted for only 1,500 

manufacturing jobs. By early 2014 there were only 547 wood and 

forestry jobs left in the state accounting for just 1.5 percent of our 

employment. 

Now some may welcome the demise of our forest industries. I 

certainly do not, and many in Southeast share my concern. 

We saw a net loss in population in the area between the year 

2000 and 2010. While mining and seafood industries have picked 

up some of the economic slack, the region’s economy is still weak. 

Unemployment was at 17 percent last month on Prince of Wales 

Island, the largest remaining timber producing area in the state. 

Now the Secretary of Agriculture is ready with, what I have said, 

could be the final nail in the coffin and that is this transition moving from harvesting old growth to second growth in 10 to 15 years. 

Now to its credit the Forest Service recognized that there is not 

enough young growth to support the current forest products industry, so it put up the Big Thorne Stewardship Contract to provide 

this bridge timber. The notice of intent for Big Thorne was issued 

in February 2011, over 4 years ago. The sale was awarded last November. Since then this critical project has been tied up in litigation. 

We passed a big hurdle last Friday on Big Thorne when a Federal District Court judge upheld the sale and dismissed the claims 

challenging it. The lawsuit though, we know, is not necessarily 

over. The environmental activist plaintiffs could appeal the decision to the Ninth Circuit and seek an injunction. The Forest Service Tongass Supervisor eloquently stated the problem with that 

3 

when he mentioned this to the Juneau Empire last November. He 

said, ‘‘The plaintiffs don’t have to win. They just have to delay. And 

if they delay long enough Viking goes out of business.’’ Some would 

argue that has been the plan all along, not to cut it off but to delay 

enough that those in the industry just give up. That is not what 

a forest policy should look like, and that is why many communities 

including in Alaska believe the only solution is to get out from 

under the existing management structure and take control of their 

own destiny. Given everything we have seen it is sure hard to 

blame them. The goal of this Committee and this Congress will be 

to help them, and that is what my intention is this morning. 

I want to thank all of our witnesses who are here with us today. 

Some of you have traveled long distances to be with us, and we certainly appreciate that. We look forward to your comments and your 

perspectives this morning. 

With that, I turn to my Ranking Member, Senator Cantwell. 

STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM 

WASHINGTON 

Senator CANTWELL. Thank you, Madam Chair, and thank you for 

holding this important hearing. 

Mr. Bonnie, I want to thank you for coming today to talk about 

the U.S. Forest Service and for your time appearing before this 

Committee in your role as Under Secretary. 

I also want to recognize Duane Vaagen, who is here from the Pacific Northwest. Mr. Vaagen lives in Colville, Washington and has 

experience partnering with the Forest Service on many of its restoration initiatives and for our region has been a leader. So thank 

you very much for being here today. 

I want to start by reflecting on the lawmakers of the 60’s and 

70’s. These members saw the problems that were being created 

with the way the Federal Government was managing our forests, 

and they set out to fix them. They passed some of the most sweeping reforms in the 20th Century and we really have not seen anything like it since. 

In recent years I have seen a lot of attempts in various piecemeal 

fashions and what is really needed, I think, is an overall 21st Century Management Plan. We need a strategy that will improve the 

health of our national forests, conserve important areas and encourage recreation, and public input needs to be unambiguous in 

the plan. 

Most of us would agree that our forests are in pretty bad shape. 

One hundred years of fire suppression has left our national forests 

prone to catastrophic wildfires, and decades of clear cutting have 

left the overall structure of our national forests unbalanced. In 

many places habitat, for our threatened and endangered species, is 

in short supply. 

Here are a few of the sobering facts. Over the last decade bark 

beetles destroyed 32,000,000 acres of 193,000,000 acres managed 

by the Forest Service. I think that was the same factoid you just 

mentioned. 

The CHAIRMAN. Yes. 

Senator CANTWELL. So we agree on that. The National Forest’s 

latest disease model shows that another 37,000,000 acres of the naVerDate Nov 24 2008 10:10 Aug 08, 2016 Jkt 094052 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\94052\94052.TXT 94052
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tional forest will die from disease before 2027. Here is another one. 

Another model shows 58,000,000 acres are at risk of imminent 

burning in a catastrophic fire. 

As we talk about this we need to assess how much these percentages are related to the lack of management and how many are 

made more difficult by the changing climate. 

So how do we move forward? That is obviously the topic of today’s hearing. We have serious challenges, and we need to address 

them in a shorter amount of time than the 100 years it took us to 

get to this place. We need to be more efficient in ways to manage 

and restore our forests. 

To do that the Forest Service needs to use management approaches that are different than the approaches of the last century. 

The previous approaches created the conditions today. In the past 

2 years we have seen restoration efforts take hold when the Forest 

Service has collaborated with stakeholders. Collaboration on watershed issues has been particularly important in the Pacific Northwest where salmon receive and deserve so much attention. These 

collaborative efforts around watershed management have been very 

helpful. 

Now restoration projects need funding to move forward. As such, 

markets for forest products are also critical to the success of these 

projects. To expand forest restoration efforts we need to expand 

markets. We have to figure out how to generate moderate value 

products from low value wood and how to generate them at a scale 

large enough to reduce the increasing devastation of wildfires. The 

increased use of cross-laminated timber and wood pellets could provide us with such an opportunity. I will say that the Forest Service 

really needs to also use different technologies. 

One example worth highlighting just because later today we are 

having a hearing in the Commerce Committee on this, is drones. 

Multiple organizations now have built drones that can be used to 

reforest areas. Each of these drones would be able to plant 36,000 

trees per day at 10 percent of the Forest Service’s current cost. 

After the devastating wildfires like we had at the Carlton Complex, 

there is a need to obviously stabilize and restore these areas. 

Overall the Forest Service is working hard to restore the health 

of the forest, but trying to measure the agency’s success only in the 

amount harvested is simply misguided. We need to look at other 

things as well. The Forest Service must keep mills nearby. I think 

I have already talked about the importance of markets, but we also 

need to make sure that we talk about stewardship contracts and 

their access to some of these smaller mills and also recreation. 

Recreation on national forests contributes $13 billion to our economy, about 40 percent of their total contribution to the economy. 

In conversations that will be unfolding I believe recreation also deserves consideration in revitalizing and expanding recreation on 

our national forests. 

We had a hearing earlier about this and had a lot of questions 

of the Forest Service on just how difficult or challenging it is for 

school organizations to get access to our Forest Service lands without these permits. So I think we need to look at that. 

We all know that wildfires are probably the biggest problem facing the forests every summer. That is why I look forward to workVerDate Nov 24 2008 10:10 Aug 08, 2016 Jkt 094052 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\94052\94052.TXT 94052
5 

ing with Chairman Murkowski and my colleague, Senator Wyden, 

with whom I am happy to co-sponsor his legislation, to put resources at play to help us manage this. 

Finally I want to reiterate the importance of the public’s input 

in management decisions. This has been very important. With any 

bill in this Committee I want to make sure that we continue to 

streamline the process but also receive input, and it must remain 

a major building block of how we manage our public lands. 

So thank you to all the witnesses for being here today. And 

thank you, Madam Chair, for this important hearing. 

The CHAIRMAN. Thank you, Senator Cantwell. 

With that we will proceed to our witnesses. I will introduce each 

of you, and then we will just go down the line. 

I would ask you to try to keep your comments to 5 minutes, then 

we will have an opportunity to present our questions to you. Your 

full testimony will be included as part of the record. 

We will lead off the panel with Mr. Robert Bonnie. Mr. Bonnie, 

thank you for being before the Committee today. It is greatly appreciated, in your capacity as Under Secretary for Natural Resources and the Environment there at the Department of Agriculture. Thank you and we appreciate your work. 

Next we have Mr. Brian Brown. Brian is the Director of Alcan 

Forest Products out of Alaska. Thank you for being here this morning, and thank you for traveling so far. 

Next we have Mr. Carlton Owen, the President and CEO of U.S. 

Endowment for Forestry and Communications, Incorporated. Good 

morning to you and welcome. 

We also have Mr. Mark Peck, who is the Commissioner in Libby, 

Montana. Thank you for joining us. 

Rounding out the panel we have Mr. Duane Vaagen, who is 

President of Vaagen Brothers Lumber. Thank you for joining us as 

well. 

With that, Mr. Bonnie, if you can lead off the panel and good 

morning. 

STATEMENT OF ROBERT BONNIE, UNDER SECRETARY FOR 

NATURAL RESOURCES AND THE ENVIRONMENT, U.S. DEPARTMENT OF AGRICULTURE 

Mr. BONNIE. Madam Chairman, Ranking Member Cantwell and 

members of the Committee, I want to thank you for the opportunity to be with you today and to talk about the U.S. Forest Service efforts to increase the pace and scale of forest restoration and 

management on the national forests. 

There’s a growing consensus around the need to restore and 

manage our national forests to address climate change, catastrophic wildfire and watershed conservation while providing economic opportunities for local communities. In national forests 

across the country we have moved from the timber wars of the past 

to a more collaborative approach that brings forest industry, local 

communities and conservation groups together to develop plans 

and projects that make our forests more resilient to a variety of 

threats. 

In Idaho, for example, former foes from the environmental community and forest industry are charting a path in the national forVerDate Nov 24 2008 10:10 Aug 08, 2016 Jkt 094052 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\94052\94052.TXT 94052
6 

est of that state to address forest health while providing a sustainable timber supply to local mills. In Arizona later this spring the 

Forest Service will finalize a plan developed a diversity of stakeholders to restore Ponderosa Pine across 1,000,000 acres and four 

national forests. In the Malheur National Forest in Oregon environmentalists and the timber industry are working together on a 

10-year stewardship contract developed collaboratively to restore 

the Blue Mountains, and on the Tongass National Forest in Alaska 

the Forest Service is working with the Tongass Advisory Committee and other stakeholders to develop a transition plan that will 

maintain forest industry while moving to second growth timber. 

The Forest Service is developing new approaches and using new 

authorities to bolster projects like these across the National Forest 

system. Let me give you some examples. 

Under the Collaborative Forest Landscape Restoration Program 

the Forest Service has made significant progress in reducing wildfire threats while exceeding the program’s 5-year timber target by 

25 percent. 

The agency is using new approaches to improve NEPA. On the 

Rim Fire in California we invested in science and collaboration to 

produce a final environmental impact statement in less than a 

year. 

Under the new Farm Bill, last summer we announced 46,000,000 

acres of lands designated as impacted by insects and disease where 

collaboratively developed projects will have streamlined requirements. And we’re investing in markets for woody biomass, solid 

wood products and other forest products to bolster the forest industry. 

To be sure these collaborative approaches are not a panacea. 

They require patience and commitment. But this approach, working with local stakeholders, using the best science and working 

across large landscapes is paying dividends. The agency is able to 

treat more acres and as a result since 2009 we have increased the 

amount of timber sold from the national forests. Ultimately however, the ability of the agency to further increase the pace and 

scale of restoration and management is not a matter of will, it is 

a matter of capacity. 

To be blunt, the way the Forest Service budgets for fire suppression is crippling the agency. Our fire seasons are 78 days longer 

than they were three decades ago. Fires are larger, more severe 

and more expensive. In 1995 the agency spent 16 percent of its 

budget on fire fighting. Today the figure approaches half of our annual budget. 

Since 1998 staff on the National Forest System has been reduced 

by 39 percent. Further, in most years the Forest Service is forced 

to transfer dollars from the non-fire budget to pay for fire. If there’s 

one action Congress could take to further forest restoration and 

management on the national forests it’s to change the way we 

budget for fire. 

The Wildfire Disaster Funding Act introduced by Senators Crapo 

and Wyden will end fire transfers. Importantly that legislation 

which is mirrored by a proposal in President Obama’s budget 

would allow the agency to increase the number of watersheds and 

7 

acres treated to 2.9 million acres while increasing our timber production to 3.2 billion board feet. 

I want to conclude by noting the incredible commitment of Forest 

Service staff to the mission of the agency. Despite the budgetary 

challenges, despite fire transfers, despite having fewer people on 

the national forests, we’re getting more done through gains and efficiency, innovation and hard work. Working with Congress we look 

forward to furthering the work to restore and manage our national 

forests. 

Thank you very much. 

[The prepared statement of Mr. Bonnie follows:] 

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The CHAIRMAN. Thank you, Mr. Bonnie. 

Mr. Brown, welcome. 

STATEMENT OF BRIAN BROWN, DIRECTOR, ALCAN FOREST 

PRODUCTS LP 

Mr. BROWN. Thank you. 

Madam Chairman, Ranking Member Cantwell, members of the 

Committee, thank you for the opportunity to testify today. 

My name is Brian Brown. I’m a director of Alcan Forest Products. We’re a timber sale operator that does business in Alaska, 

Washington State and British Columbia (BC). We purchase timber 

sales from Federal, State, and private land in all three areas and 

harvest these sales for production by mill operators in these and 

other markets. We have employees in each of these three areas. 

As a long time member of the Alaska Forest Association and part 

owner of Alcan Forest Products I am here to ask for this Committee’s help. Our company’s operations support over 200 jobs in Alaska. We purchase our timber from the state, the University of Alaska, Mental Health Trust as well as the U.S. Forest Service. 

However, the Federal Government controls nearly 95 percent of 

the land in the region and a small amount of private, state and 

municipal lands are inadequate to sustain our operation in the future. Much of the timber we harvest on Federal lands is sold to 

local manufacturers. For example, over the past couple of years we 

have supplied virtually 100 percent of the saw logs used in the 

Wrangell sawmill and also to the local Ketchikan mill which provides pellets to the Federal building in Ketchikan as well as a large 

percentage of Viking’s outside log purchases. 

But all of our Federal timber sales will be harvested this year, 

and the Forest Service’s latest 5-year schedule further reduces the 

already inadequate timber supply in our region. There is a small, 

very small, amount of young growth timber that the Forest Service 

indicates it will sell in the future, but most of that timber is too 

small and scattered to be economically viable for harvesting operations. In another 30 years there will be much larger acreages of 

young growth potentially available but until then the young growth 

cannot replace the mature timber stands that we need to remain 

profitable. 

Alcan does about $80 million worth of business including payroll 

expenses in Washington State, including Washington State resident employees located in Aberdeen and Port Angeles. We also operate a large business segment now in British Columbia. Unfortunately British Columbia is the only location near Southeast Alaska 

or Washington State that provides a business environment that encourages major investments in the forest products industry. Federal timber policy increasingly forces us to look to BC for our operational and investment future. 

At this point I would like to submit for the record testimony from 

my fellow AFA Board Member, Kirk Dahlstrom. 

The CHAIRMAN. It will be included as part of the record. 

[The information referred to follows:] 

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Mr. BROWN. Thank you. He’s the operator of Viking’s sawmill. I 

am prepared to answer questions on his testimony also. 

Most of the local communities in our region have declined commensurate with the 90 percent decline in Federal timber sales over 

the past 20 years. Government jobs and subsidized make work 

projects have provided the minimal amount of economy for the region but it’s a false economy and it’s not sustainable, particularly 

in light of the State of Alaska’s difficult budget situation. 

For instance, fish populations have doubled in the most heavily 

harvested watersheds in the region, and all of the waters meet the 

State and Federal water quality standards. Yet the Forest Service 

is spending millions of dollars performing stream restoration 

projects in these areas. These projects might be nice gestures but 

they will likely not result in additional fish or more clean water. 

The projects rely on Federal expenditures, and they are not sustainable without more Federal subsidies because these project investments do not permit any investment in infrastructure. A state 

forest managed under the State Forest Practice Act, on the other 

hand, can provide thousands of jobs and millions of dollars in net 

revenue. 

All of this can be accomplished without impacting fish and wildlife populations or subsistence or recreation or any other beneficial 

uses of the forests. That is why our Governor, Bill Walker, has endorsed the creation of this state forest. He recently confirmed this 

support in two meetings. He had one in Juneau and one in Ketchikan. He supports the creation of this state forest and strongly supports the idea of value added products such as our timber industry 

can and will provide if we just get a decent supply of timber. 

Attached to my testimony are two documents that I ask to be 

part of the record. The first is a history of the Alaska timber industry. The second is an Alaska State Forest Concept paper which describes the state forest and which AFA urges this Committee to 

create through Federal legislation. 

The CHAIRMAN. Those will also be included as part of the record. 

Mr. BROWN. Thank you. 

If a state forest is not established, the surviving timber industry 

will perish and this region will become another Appalachia doomed 

to endless poverty and families dependent upon government jobs or 

welfare. 

Thank you for the opportunity to address you. 

[The prepared statement of Mr. Brown follows:] 

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The CHAIRMAN. Thank you, Mr. Brown. 

As I mentioned, all of the reports as well as Mr. Dahlstrom’s testimony, will be included in full as part of the record. 

Mr. Owen, welcome to the Committee. 

STATEMENT OF CARLTON OWEN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, U.S. ENDOWMENT FOR FORESTRY AND 

COMMUNITIES, INC. 

Mr. OWEN. Thank you, Chairman Murkowski and members of 

the Committee. It’s my privilege to be with you today. 

I’m a forester and a wildlife biologist that next year will reach 

40 years in the profession. Half of that has been in the forest products industry and half working with non-profits in the forest sector. 

It’s been my privilege for the last eight and a half years to head 

the U.S. Endowment for Forestry and Communities. 

We’re a little bit of a rare critter. We came out of the trade settlement between U.S. and Canada over softwood lumber in 2006. 

We were given a one time, $200 million endowment with two purposes. One to promote healthy working forests in the U.S., and second to promote family wage jobs in forest rich communities. 

We go about that in a number of ways but primarily in trying 

to work with either those in the public or the private sector that 

are willing to look for systemic transformative and sustainable 

ways to address the issues of forest health and productivity and 

jobs. 

I ask that you accept our annual report that we provided with 

our testimony as part of the record, Chairman. 

The CHAIRMAN. It will be included as part of the record. 

[The information referred to follows:] 

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Mr. OWEN. Thank you. 

I work as forest centric where we focus on private forests, the 

issue that’s a number one concern is conversion. Forest Service predicts that land area between the size of West Virginia and Wisconsin will be lost to conversion over the next 40 years. One of the 

issues that’s most important to keep those forests as forests or vibrant markets. 

When we talk about the Federal lands we have a very different 

set of issues. We’re not worried about conversion. We’re worried 

about keeping those forests healthy and productive, but again, 

markets are a critical part of making that so. 

As author Eric Rutkow in his book, ‘‘American Canopy,’’ notes, 

‘‘nowhere else has a culture been so intimately associated with 

wood like that in the U.S.’’ 

We like wood. We build our homes from it. We use paper products. Look around this room, wood ordains every wall and the very 

desk we sit at today. 

Remarkably over two centuries later 320,000,000 Americans, we 

have about 70 percent of the forest estate that we had when we 

originally colonized this country. One third of our nation is covered 

in forest. Public forest represents about four of ten of those acres. 

And they’re important not only to future generations for the ecological values they promote, but for also economic opportunity in 

rural communities and as an example to everyday Americans that 

we can, through forestry indeed, have our cake and eat it too, with 

forest management. 

The endowment does not advocate a return to timber management as an overriding use of the public forest, but we do believe 

that timber management has an appropriate role on the public 

lands. In fact, without management keeping those lands intact it 

is nearly impossible. As a dear friend of mine, Neil Sampson, 

former head of American Forest, says, ‘‘Our 50-year love affair with 

the concept of wilderness is running headlong into the reality of climate change and the fact that we can’t preserve dynamic ecosystems.’’ 

We’ve talked about the planning processes over the last couple 

of speakers, and we would agree that planning processes are one 

of the challenges we have to find ways to bring reason to them and 

shorten them to the speed of need. Forests are dying much more 

rapidly than we can move. Collaborative are one of the best efforts 

that have been put in place to achieve that, and I think one of the 

reasons has already been mentioned that they involve local communities and local residents in decision-making. 

As it relates to NEPA we’re encouraged by some of the things 

that the agency is doing to address NEPA, but the bottom line, 

again, we have to find ways to shorten the process while still 

founding it on science to address the needs of those forests. 

Stewardship contracting has been one of the bright spots. And if 

we look for one negative in there it’s probably that the limit of 10 

years is too short to make the kind of economic investments in the 

private sector to take those risks. So we would encourage either extending that period of time or at least allowing extensions without 

having to restart the process. 

56 

On watersheds and water, we think it is the most important 

product that flows from our forests. Two out of three Americans get 

their drinking water, every day, from a forest. One out of two get 

it from a public forest. 

We can’t wait for examples like Denver where a catastrophic wildfire on public lands sends $150 million bill downstream to the 

utility and to the citizens of that community. We’ve got to find new 

ways to work together to address that. 

The endowment is working with the Forest Service on two initiatives to address the challenges that face public lands, and that’s 

primarily around low value, small diameter, dead and dying wood. 

One is a product of the future. Cellulosic nanotechnology, products 

that are based on green building materials, products of the 21st 

century that can use low value wood to make high value products. 

The second is torrefaction, essentially roasting low value wood as 

a carbon substitute. 

And let me end real quickly by saying we also have to redirect 

our R and D initiative in the future to have a more collaborative, 

public/private partnership to address the needs of the forests. 

Thank you, Madam Chairman. 

[The prepared statement of Mr. Owen follows:] 

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The CHAIRMAN. Thank you, Mr. Owen. 

Mr. Peck, good morning. 

STATEMENT OF MARK PECK, COMMISSIONER, DISTRICT NO. 

ONE, LIBBY, MONTANA 

Mr. PECK. Madam Chair Murkowski and Ranking Member Cantwell, I want to thank you for the honor and opportunity to testify 

here today. 

The 2.2 million acre Kootenai National Forest constitutes 78 percent of Lincoln County’s land base and has served as a cornerstone 

of our rich cultural and economic history and holds the key to our 

future prosperity. The forest is the most productive in the state 

growing an estimated 400,000,000 board feet of timber annually 

and is home to the 96,000 acre Cabinet Mountain Wilderness Area. 

Raised in Lincoln County I lived an ideal childhood raised in a 

proud logging family, hiking and fishing the lakes of the Cabinet 

Wilderness Area. I learned to love them both. After a 20-year career in the Air Force I returned home to a community dramatically 

different from the one of my childhood. 

Lincoln County is in artificial and unnecessary war between economic and environmental philosophies. The conflict has wreaked 

havoc on a once vibrant community and a once vibrant forest landscape. 

When I graduated in 1977 Libby High School had more than 700 

students. We now have approximately 300, and we’ve lost over 

1,000 students from all grades since 1998. 

We used to be one of the wealthiest counties in the state. We’re 

now one of the poorest. We lead the state in unemployment. There 

are no longer major mills in Lincoln County, and the logging industry has dwindled to just a handful of small operators. The number 

of Forest Service personnel has dropped from over 500 to just over 

300. Our county and school income from forestry seats has fallen 

from $4.5 million in 1994 to just over $300,000 in 2013. 

We have severe forest health issues, increased threat of severe 

wildfire, marginal, if any, progress recovering threatened and endangered species and a devastated local economy. We do have a 

new motto in the county. It’s poverty with a view. 

Gifford Pinchot stated, ‘‘The planned and orderly development 

and conservation of our natural resources is the first duty of the 

United States.’’ Orderly development and conservation, not development or conservation. We must move past the tired old arguments of timber verses wilderness. The two are not mutually exclusive. They are both essential tools in maintaining the social, economic and ecological balance we all seek. 

It is agreed that the grizzly bear needs an extensive open space 

with limited influence from man, but the interagency grizzly bear 

guidelines also tell us that through proper timber harvest and I 

quote, ‘‘Grizzly habitat can probably be increased or enhanced by 

creating openings producing high quality grizzly food, facilitating 

greater grizzly use in forest habitat where normal grizzly use appears light.’’ We must begin to manage the forest for the forest, 

habitat for the habitat and the social, economic and ecological balance we all desire will be more achievable. 

69 

Agencies, State, and local governments in concert with local collaborative groups are creating local balanced solutions. Hours and 

years of collaboration have created on the ground solutions but 

have no avenues of implementation. We must empower local collaborative management. 

Special recommendations for consideration to be immediate priority full funding of PILT and funding of Secure and Rural Schools 

until harvest levels increase to meet established forest plan allowable sale quantity levels. 

Establish a professional tiger team to develop a revolutionary 

plan for managing Federal lands into the next century. Solve the 

fire funding drain on Forest Service operational budgets. Authorize 

and fund innovative pilot projects. Modify the Equal Access to Justice Act to balance between an individual’s right to due process and 

protection against frivolous or excessive use in Federal land management cases. Staff local Forest Service units to meet established 

Forest Service plan objectives. Modify the Endangered Species Act 

to be more inclusive. Move away from single species management 

and provide more emphasis on socioeconomic concerns. 

Once again, I thank you for the opportunity to share my testimony and look forward to your questions. 

[The prepared statement of Mr. Peck follows:] 

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The CHAIRMAN. Thank you, Mr. Peck. 

Mr. Vaagen, welcome. 

STATEMENT OF DUANE VAAGEN, PRESIDENT, VAAGEN 

BROTHERS LUMBER COMPANY 

Mr. VAAGEN. Good morning, Madam Chairwoman, Ranking 

Member Cantwell, members of the Committee. 

I’m Duane Vaagen, President of Vaagen Brothers Lumber, a 60- 

year old, family-owned company based in Colville, Washington. I’m 

here today to discuss the urgent need to restore responsible, sustainable management to our Federal forests. We have survived 

over the years by focusing on technology, good forest management 

and a commitment to healthy forests and communities. Our company has also invested into collaborative process long before Federal programs were established to encourage it. 

We own and operate two small log mills in North East Washington, one at Colville, one at Usk. The Usk is down right now for 

the last 4 weeks because of lack of logs, and we only have enough 

logs to run it at 50 percent per year. We employ over 225 people and contribute $125 million to the 

local economy. Until last fall we operated a small log mill in Eager, 

Arizona when a lack of timber from the Forest Service forced us 

to shut it down. 

This Committee is well aware of the crisis facing the health of 

our Federal forests. The Carlton Complex in Washington last summer gave us a glimpse of this, burning 236,000 acres, the largest 

fire in our state’s history. Washington State’s Commissioner of 

Public Lands, Dr. Peter Goldmark, recently summed up the situation in our state when he said, ‘‘Millions of acres of Federal forest 

land have become an all you can eat buffet for forest killing insects.’’ 

Nationwide the Forest Service says between 60,000,000 and 

80,000,000 acres are at particular risk. Federal forests across the 

country, including Colville, are overstocked and in need of management. There is great agreement on the need to expand management to more acres. Unfortunately current policies in place will not 

allow that expansion to happen. 

Our experience on the Colville is unique. Due to collaboration we 

haven’t seen litigation on our forests and have had only one appeal 

in the last decade. There’s broad support to increase acres treated 

and timber outputs. 

Our industry infrastructure makes it possible to treat the forest 

and to generate significant revenue in doing so. Despite this the 

Colville National Forest cannot meet the treatment levels supported by the collaborative. I’m often asked, how could this be? 

While we haven’t seen lawsuits on the Colville, our forest still operates under a significant NEPA compliance burden imposed by 

Congress and made excessively complicated by the courts which 

sap resources needed to maintain healthy, vibrant forests including 

forests like mine where collaboration is alive and well and litigation is not. Collaborative efforts are often still litigated by those 

who refuse to participate. They tie up and delay forest management projects and suffer no consequences while those who work in 

good faith see their time and energy squandered. 

77 

The Forest Service has several tools they can use to address this 

problem including further experiments with third party NEPA and 

using retained receipts to fund further project work. We’re close to 

implementing the first of its kind A to Z project to demonstrate 

substantial savings in complying with NEPA, but this approach 

will not work everywhere and it is up to Congress to take action 

to reform this broken system. 

Congress must address this complex NEPA process and seek innovative solutions including streamlining NEPA analysis and ESA 

consultation for projects on some productive timber land and for 

projects proposed by local collaboratives. 

Next, use retained receipts through stewardship and timber sale 

contracts to fund NEPA analysis and planning for future projects. 

Congress must put reasonable limits on destructive litigation including requiring those who sue to post a bond to discourage frivolous litigation. Use baseball style binding arbitration as an alternative to litigation. 

Congress can help clarify where management can and can’t take 

place on National Forests focusing on the small portion of the system which is supposed to be available for timber harvest. 

The industry is poised to help address the significant challenges 

facing the National Forest System and to ramp up the number of 

acres treated to the point where we would be making progress in 

reducing the threats of future fires and insect infestations. By rapidly restoring burned acres aggressively, the need to protect watersheds and offering valuable timber where it can be done we can 

both help our forests and our rural communities. But the forest 

needs Congress to provide the road map and the direction to use 

it. 

We stand ready to work with you to define the future. 

Thank you. 

[The prepared statement of Mr. Vaagen follows:] 

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The CHAIRMAN. Thank you, Mr. Vaagen. 

Thank you all, gentlemen, for your comments this morning as we 

discuss the future of our forests around the country, an amazing 

renewable resource that, I think, we would all agree requires a 

level of management. How we do that appropriately and effectively 

with good stewardship, not only of the forest, but of taxpayer dollars as we address that, is a challenge. 

We have heard in this Committee and in other committees from 

Chief Tidwell the comment that what we really have to get our 

arms around is the fire borrowing issue so that we change the way 

that we budget for fire. I absolutely concur, but I also recognize 

that there are other issues out there that are at play. If we were 

to fix the fire borrowing issue today, it still leaves us with some 

of the policies that are locking us in and that is what I want to 

talk to you about this morning. 

First, Mr. Bonnie, when we talk about the Tongass transition 

going from old growth to young growth, that has always been part 

of the plan for the Tongass. But the disagreement has really been 

on the timeframe. The Secretary’s memorandum from 2013 calls for 

transition to take place between 10 and 15 years, and most within 

the industry, certainly all within the industry in Alaska, say it is 

going to take much longer than that. 

Regardless of arguing over the time period, what you have in 

play with this transition is management is still subject to the existing laws, the existing regs, that are generally applicable with respect to our timber harvest. The Secretary’s memorandum, so far 

as I know, does not propose making any changes that currently 

apply. 

There is no departure from the National Forest Management 

Plan that requires that the timber be harvested on sustained yield. 

There is no modification from the existing Tongass Land Management Plans, the beached setback rule, no departure from the 

stream buffer rules that are set out in the Tongass Timber Reform 

Act. So how do we do this? 

Unless there is some willingness to perhaps look to departing 

from some of these statutes or regulations, how do we get to what 

you are discussing, Mr. Bonnie, which is this transition to second 

growth? Because my assessment and that of many who have been 

studying this for a long time is that you cannot get to where you 

are seeking to with the volume of second growth given these statutory and regulatory requirements. 

Mr. BONNIE. So, thank you, Madam Chairman. 

I think, you know, we’ve got some flexibility in the Sealaska legislation for culmination to meet annual increment that will allow 

us to get into stands earlier. We’re obviously looking right now at 

a plan amendment on the Tongass Land Management Plan working closely with the Tongass Advisory Committee there. We think, 

we hope, there will be good recommendations that come out of 

there that will look at the land base where we can get to second 

growth timber. 

So I think we’re confident that both looking at the land management plan, working through—looking at lower rotation ages so we 

can get into younger timber earlier will be important elements. 

87 

In addition to that we want to look at ways that we can provide 

assistance to the local industries. So are there grants, programs or 

other things? We’ve already had an initial conversation I think 

with your staff and need to followup about ways that we can provide assistance there for the transition. 

I think the, you know, old growth timber continues to be controversial there. The promise of a transition is both to hold on to 

the industry and to get to a place where, not only we can provide 

a sustainable timber base, but perhaps we can actually put more 

on the market as—because those sales will be easier to move. 

The CHAIRMAN. Well, you are using the same buzzwords that we 

have heard from the Chief about flexibility and about assistance, 

but you have also heard my criticism that we have not seen that 

assistance. We have not seen the retooling that has been promised. 

The flexibility has been in word only. You mention the CMAI waiver, and I am very, very familiar with that, of course, because we 

worked with Forest Service on that in the Sealaska legislation. 

What we have got with the Tongass, and I am not telling you 

anything that you do not know, but we harvested there in the early 

60’s and the harvest was along the beach and along the streams. 

Harvest of the oldest of the young growth timber cannot be permitted because of the restrictions under the Tongass Timber Reform Act and the amended restrictions. So the oldest of the young 

growth is not going to be available for harvest, notwithstanding the 

departure from CMAI. 

So my time is over on this, but I want to come back and have 

a further discussion because I think sometimes it is real easy to 

throw some terminology around, make it sound like help is on the 

way. But for people like Mr. Brown, for people like Kirk Dahlstrom 

and his testimony is really quite compelling when he says, look, 

I’ve got no other available sources of timber supply. We need to 

make sure that it is more than just words that give assurance, that 

is there is flexibility and that there is some workability because 

right now I do not have it and I do not think that the operators 

on the ground have it. 

I will go to our Ranking Member. 

Senator CANTWELL. Thank you, Madam Chair. 

I have a bunch of questions, but I am going to start with you, 

Mr. Vaagen, about well, maybe I will just throw it all out there, 

and people can answer it. What about predictability because obviously you do a lot restoration work. What else does the Forest 

Service need to give you so that you can have more predictability? 

Obviously you had some attempts in Arizona and then the Forest 

Service did not bid, so you could not do that work. So what do we 

have to do about predictability? 

Mr. Owen, you mentioned the issues of new materials and pellets. What else do we need to do to help that value chain grow? Is 

that something we need to do or what? How do we help that? 

Mr. Bonnie, Mr. Brown mentioned something about fish and 

water saying we did not get results, but I am pretty sure that we 

have had pretty good results in the Northwest from our forest plan 

on improving water quality. That has been pretty critical. So if you 

could comment on that? 

Mr. VAAGEN. Okay. Thank you, Senator. 

88 

The predictability is always important because you have an asset 

and you have your employees and the economic of all that to put 

into play. 

We did go to Arizona, very good learning curve, very expensive 

learning curve. We were enticed to go down there and visit a White 

Mountain stewardship which is the largest stewardship at its time 

ended August 10th last year. When that timber dried up, the mill 

dried up. The good news, somewhat on wheels, they were moving 

it to Snowflake. We’d get another run at it, another chance. 

I can tell you 10 years is not enough to move a mill or build a 

mill. So without mills there’s no markets, and it’s hard to build 

new mills. 

I think what’s needed is that predictability for all the current 

mills because there’s somewhere we have got to connect the dots 

that we have these tools. We have the forests that need this 

60,000,000–80,000,000 acres of treatment. We’re counting other 

things of treatment when we really need to process it to its highest 

and best value for the economical gain, and we hate to see it all 

burn up. 

So, predictability is very important. I like the idea of a 21st Century Plan that would include that. I am an advocate of collaboration, but it has to be adequate collaboration, you know, you’ve got 

to have some side boards on it so it works. And it can be very successful. So predictability is what’s important, and we don’t even 

have that on our current mills. We would like to help others do 

more. 

Our trees are dying in the Colville National Forest at an alarming rate. I didn’t think they’d come. Colorado and Wyoming and 

Montana had the brunt of it, but BC taught us a lesson but we 

didn’t get the lesson. 

Senator CANTWELL. Thank you. 

Thank you, Mr. Owen. 

Mr. OWEN. Senator Cantwell, on the issue of new products and 

markets there’s sort of a two-phased approach. 

Number one, we’ve got to rebuild our R and D infrastructure in 

this country. We’re the country that invented innovation. In the 

forest products sector we’re spending about one half of one percent 

of sales, and most data says that if you’re not spending one to two 

percent in R and D you’re going backward. And that’s across the 

entire sector. That’s public and private investment together. We 

need a new model. Our neighbors to the north are spending six 

times as much on products of the future than we are. 

The Forest Service R and D budget has continued to shrink. It 

also needs to be retargeted in a way that is more oriented toward 

products and the tools to get the wood out as we’ve seen the declines across the agency. 

They’ve been, intended to be, not targeted to take out the fat or 

to reorient to a new way. We think there has to be a new public/ 

private partnership, and that means the private sector has to put 

in and then has to help oversee and direct that research to make 

sure it meets their needs and objectives. That’s point one. 

Point two is we have to have new markets that currently are not 

available. We’ve lost over 500,000 jobs in the forest sector since 

1990. Those aren’t going to come back. Collaboratives aren’t going 

89 

to produce those kinds of jobs. We need new products. We think 

nanotechnology which is predicted to yield a $200 billion market in 

wood alone, $2 trillion market worldwide, but if we use that low 

value wood as an opportunity. One of the things we’re doing is 

working with the Forest Service and saying R and D in its traditional format or just research for research purposes isn’t enough. 

At the endowment we come with a real sense of urgency. And so 

we put together a collaborative with the agency and said in 2 years 

we’re going to either push this over the curb and say there is a viable market there using woody cellulose or there’s not. 

At the same time that’s looking at high value products and high 

wage jobs of the future. We’re looking at the mass amount of wood 

and the low value of opportunities, and we believe one of the best 

options is to create a domestic green energy that would use 

torrefaction which is roasted wood. You do it in the forest, and then 

you can ship it out. You can’t ship green wood long distances due 

to the 50 percent water. 

Those types of things need to have an urgency and a directive, and right now we’re putting in about $6 million collectively. That’s 

pennies compared to the opportunity. 

Senator CANTWELL. Thank you. 

I see my time has expired. I will just have to get a yes or no out 

of you on the forest plan and watershed. 

Yes, it’s been effective? 

Mr. BONNIE. Absolutely, absolutely critical. And yes, we’ve been 

effective in a number of areas. 

Senator CANTWELL. Thank you. 

The CHAIRMAN. Thank you, Senator Cantwell. 

Senator Daines? 

Senator DAINES. Thank you, Madam Chair. 

I ask unanimous consent to submit a letter for the record from 

the National Association of Home Builders indicating their support 

for an increase in the supply of Federal timber products. 

The CHAIRMAN. It will be accepted. 

Senator DAINES. Thank you. 

[The information referred to follows:] 

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Senator DAINES. Commissioner Peck, it is great to have you here 

from Montana. Thanks for making the trip out here. 

I was struck by your testimony as we look at the sharp drop in 

timber harvests in Montana. Your testimony powerfully captures 

the unacceptable situation we have in Montana and other parts of 

our country. As you mentioned your home in Libby, home of the 

Libby Loggers, I understand we have some students just behind 

you today from Libby. Welcome to all of you as well. 

In many ways this hearing is about their future we are talking 

about so that they can raise their families and stay in Lincoln 

County if they want to. 

I heard a very troubling statement in one of our roundtables recently up near Lincoln County when somebody said perhaps the 

Libby Loggers should be renamed the Libby Lawyers because there 

no longer is a large active sawmill in Libby. The economy there, 

your unemployment rate, is completely unacceptable. 

Commissioner Peck, like you I believe it is important to 

incentivize and protect collaborative driven projects, but it seems 

clear to me that current laws and policies do not adequately do 

this. Do you agree the Forest Service needs better direction and 

latitude to ensure that timber projects in Montana and elsewhere 

are implemented more quickly? 

Mr. PECK. I would agree with that. 

Senator DAINES. How would you characterize the level of timber 

harvest today compared to what is both sustainable and healthy for 

Montana’s National Forest? 

Mr. PECK. If I look back historically as a young man growing up, 

the cut volumes on the Kootenai were averaging over 100,000,000 

board feet a year. The past few years we’ve been averaging between 30,000,000 to 50,000,000 feet depending on different circumstances. As I stated in my opening testimony, the Kootenai on 

the average grows an estimated 400,000,000 board feet a year. It’s 

a very productive forest. You can’t keep trees from growing there. 

Having said that, there’s no question that the cuts that we’ve 

been seeing are, in my opinion, not only as a County Commissioner 

but as a former Montana Department of Natural Resources timber 

manager, far below what we need to see from a forest health standpoint and definitely from an economic standpoint. 

Senator DAINES. Just a few months ago a notice of intent to sue 

was filed against the East Reservoir Project in the Kootenai. It was 

a collaborative driven project that took years to go through the 

NEPA process and yet now faces an uncertain future. We have got 

to stop these obstructions, certainly, in the process. 

You mentioned that for several years you worked alongside the 

Montana Department of Natural Resource and Conservation. As 

you know the Montana State law requires that DNRC meet an annual timber sale requirement which now exceeds 57,000,000 board 

feet. 

There is an old saying in business, if you aim at nothing, you’ll 

hit it. I think we see that increasingly right now how the forests 

are being managed. 

What, in your view, is the value of having a clear timber target 

in statute that must be met? 

92 

Mr. PECK. You know from our standpoint on the state lands it 

was absolutely critical. It provides not only motivation, but predictability and accountability, not only from a sustained yield and 

health of the forest and habitat standpoint, but it brings predictability to industry as well. 

So to me, without it, it would be like playing football without 

keeping score. Eventually you get tired of getting beat up so I think 

it’s critical. It was very effective in our operations at the state 

level. 

Senator DAINES. Alright. Thank you, Commissioner Peck. 

Secretary Bonnie, the Forest Service Chief Tom Tidwell was recently here on the Hill and acknowledged before Congress the negative impacts associated with litigation. He also stated that the 

goal of nearly tripling harvests in Montana’s National Forest is 

very reasonable. We used to be at 600,000,000 board feet on our 

national forests across Montana. Last year we were at 113,000,000. 

I appreciate the work of the Forest Service and what they do in 

Montana, and I want to work with you in finding solutions that 

will bring about this outcome in the near future. In your testimony 

you highlight the steps the Forest Service has taken to increase 

and accelerate forest restoration. While these might be positive 

steps, Montanans can tell you with certainty that they are really 

not nearly enough. 

I would like to quickly run through some possible reforms and 

ask that you provide just a quick yes or no as to whether USDA 

supports them or would consider supporting them as we look to 

move forward here with some reforms. 

First, a simplifying environmental review for all timber sales 

that are the result of a collaborative process? 

Mr. BONNIE. I think we’d welcome a conversation on that. 

Senator DAINES. Is that a yes or a no? 

Mr. BONNIE. Well, it obviously depends on what it is, but that’s 

been part of the type of approach we’ve used. We think collaborative approaches are good. We would welcome the conversation. 

Senator DAINES. You support collaboratives? 

Mr. BONNIE. Absolutely. 

Senator DAINES. Alright. Establishing a categorical exclusion for 

all collaborative and timber sales that is comparable over the size 

of the new 3,000-acre CE projects combating insect infestation? 

Mr. BONNIE. So I think we’re very interested in ramping up the 

insect and disease CEs significantly, and if there are comparable 

approaches we’re interested. 

Senator DAINES. So, the 3,000-acre CE is something that we 

could do? 

Mr. BONNIE. Absolutely. That’s what’s in the Farm Bill, and 

we’re looking forward to putting that on the ground. 

Senator DAINES. Simplify—— 

The CHAIRMAN. The Senator’s time has expired. 

Senator DAINES. Okay, I will come back. We will talk some more. 

Mr. BONNIE. Please. 

Senator DAINES. Thank you. 

The CHAIRMAN. Senator Franken? 

Senator FRANKEN. Thank you, Madam Chair. 

93 

The forest product industry is the fifth largest manufacturing 

sector in Minnesota. It employs about 30,000 people statewide, and 

it is particularly vulnerable to the effects of climate change. 

For example, Aspen, Birch and Balsam Fir trees are all economically important timber species and all are expected to decline significantly due to rising temperatures. In order for the forest products industry to continue to thrive in Minnesota and elsewhere we 

have to ensure that appropriate strategies are in place to mitigate 

the loss of valuable tree species. 

This question is either for Mr. Owen or Mr. Bonnie. Can you talk 

about what the Forest Service is doing to better understand and to 

adapt to the effects of climate change, specifically the loss of economically important tree species? 

Mr. BONNIE. So on the research side this is an area that our research staff are looking at not only the loss but the type of management activities that we can do to retain forest resiliency including 

those species. We’re also trying to build this into the work we’re 

doing on the ground. Whether it’s forest restoration to deal with insect and diseases, whether it’s forest restoration dealing with catastrophic wildfire, there’s a climate overlay on a lot of that work and 

so increasing the Forest Service’s understanding of that, but then 

also being able to monitor the work as it’s being done is going to 

be critically important going forward. 

Mr. OWEN. Senator, the U.S. Endowment and the Forest Service 

have been working for a little over five years on what we call the 

Forest Health Initiative, and it’s looking at modern sites to deal 

with 21st Century problems. 

Trees can’t move at the speed of climate change so we need to 

address some of the challenges that are occurring almost monthly. 

We lost the American Chestnut and we lost the American Elm due 

to blights, but that was over a period of lifetimes. We’re now losing 

species literally as we watch it happen. 

We believe that that collaborative work we’re doing and it involves some of the major environmental groups in the country of 

saying, can we not use modern scientific tools to help address the 

changes that are occurring in the forest genetics and genetic modification? We have shown that instead of taking 30 years to deal 

with a forest health challenge we can do it in 3 years using modern 

science. 

We’re at the place now of having proven the scientific aspects 

and we’re dealing with the regulatory and the social aspects of that 

which are probably far more challenging than the science challenges are. 

So again, targeting that work at the speed of need I think is one 

of the greatest things. Scientists, and I’m a scientist with a little 

s, I don’t practice science in the lab all day long. But often there’s 

not that sense of urgency to address a specific problem. We want 

to keep studying and peeling back the onion. We need to look at 

what’s good enough rather than looking for the perfect. 

One of the things we’re going to have to see is some recognition 

and flexibility in APHIS, FDA and EPA that if we’re going to address forest health challenges we have to do them in ways that 

we’d never anticipated before under legislation. 

Senator FRANKEN. I got it. Thank you. 

94 

Let me talk about the climate change and wildfires. We cannot 

any longer deny the devastating impacts that the climate change 

is having on the intensity and length of the season and the size. 

Fighting wildfires is costing a lot of money, about half of the Forest 

Service’s total budget. All that spending means that preventive 

measures such as removing hazardous fuels is receiving less funding. 

So I am very interested in finding new markets for forest waste 

in order to help pay for the removal of hazardous fuels and simultaneously bring economic benefit to plants that can burn the waste. 

Mr. Bonnie, what are your recommendations to Congress for improving the viability of woody biomass markets, particularly in addressing this kind of dual use of removing hazardous waste which 

is to make the wildfire less likely and to use this for distributive 

energy and that sort of thing? 

Mr. BONNIE. So I think it’s vital. If we’re going to restore our forests, it’s vital that we have a vibrant industry. And it’s vital that 

we have markets, not only for solid wood products but also for 

smaller diameter trees and so biomass becomes really, really important. 

On the research side there are things we can do. Carlton has 

talked about some of the things we can do whether it’s nanotech 

or other technologies that are important. Forest products lab is involved in many of those, so I think that would be a critical piece 

of this. I think also how we look at treating biomass in terms of 

missions, those types of policy issues are going to be important as 

well. 

Senator FRANKEN. Thank you. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator Franken. 

Senator Barrasso? 

Senator BARRASSO. Thank you very much, Madam Chairman. I 

want to thank you for holding this hearing today. The condition of 

forest health, of rural economies and wildlife habitat are some of 

the issues that I plan to continue addressing as Chairman of the 

Public Lands Subcommittee. 

Under Secretary Bonnie, I want to welcome you to the Committee. Thank you for being here. I think it is important for you 

to personally understand my views relating to the Forest Service. 

For over a dozen years Congress has steadily provided the Forest 

Service with new authorities that allow but do not require the 

agency to actively manage our forests. The Forest Service has become a bureaucratic agency emphasizing internal process over real 

results and improvements on the ground. The Forest Service, I believe, has lost its direction, has lost its purpose and Congress can 

no longer trust the Forest Service to use the tools that it has been 

given to improve forest health because the agency itself has failed 

to make any meaningful improvements. 

While I am encouraged by your written testimony today, I have 

concerns with the Forest Service’s draft Good Neighbor agreements. In comments to the Forest Service the State of Wyoming 

submitted the following, ‘‘As presented Wyoming State Forestry Division sees limited utility in the agreements and does not currently 

foresee pursuing projects under the Good Neighbor Authority.’’ 

95 

You know how hard Congress has worked to try to get the Forest 

Service another useful tool to get more work done. It is simply unacceptable for the Forest Service to turn what is a very useful tool 

into something that a state has no desire to use. 

Also in your testimony you noted the agency has designated over 

46,000,000 acres or approximately 25 percent of the national forest 

system as areas experiencing or at risk of experiencing insect and 

disease infestation. This figure does not include insect and disease 

infested acres in wilderness areas, so there is obviously more than 

that. 

So when it comes to forest health I believe that the agency is 

guilty of malpractice. If we are going to save our forests Congress 

must direct and mandate results and outcomes, and for this reason 

I plan to reintroduce an updated version of my National Forest 

Jobs in Management Act later this spring. 

I view this hearing as an important step in gaining additional insight into what Congress must do to improve forest health, to increase wildlife habitat, to grow rural economies and to protect top 

soil and watersheds from wildfires. 

Under Secretary Bonnie, the Forest Service reports there is up 

to 82,000,000 acres in need of treatment. The report that you provided today for Fiscal Year 2013 says the agency treated fewer 

than 3,000,000 acres, and for Fiscal Year 2014, again, fewer than 

3,000,000 acres and over half of that relied on fire treatments. So 

it means roughly only 3 percent of the acres in need of treatment 

actually receive it. I am curious what grade would we give a doctor 

at a health maintenance organization who annually treated only 3 

percent of the patients who needed attention? 

Mr. BONNIE. So we’ve increased the amount of acres we’ve treated since 2009. We’re selling more timber on average than over the 

last six years. You’re right though, we need to get more work done. 

There’s no question, we agree with that. 

There are two ways to think about that problem. One is to drive 

more efficiency into the system. You mentioned Good Neighbor Authority. I think we’ll get to a good place on that. 

Insect and disease, ability to get more work done with fewer people, at the end of the day we still have a capacity challenge. We’ve 

got over a third fewer people than we used to have in the National 

Forest system. We’re doing more with less. We have to both deal 

on the efficiency side as well as the budget side and the fire budget 

is going to be critical to that. 

Senator BARRASSO. Thank you. 

Mr. Vaagen, your written testimony states one of the primary 

challenges for your family business is the lack of forest management and the subsequent shortage of raw materials. I hear the 

same concern from the owners in Wyoming. We know there is excess material needing to be harvested to prevent fires, to improve 

habitat, to create jobs. Yet the Forest Service, I believe, is unable 

to make that happen. In your view does Congress need to mandate 

active management targets to achieve ecological and economic benefits? 

Mr. VAAGEN. I think that is one of the key answers. 

Senator BARRASSO. Mr. Brown, both Alaska and Wyoming have 

filed lawsuits opposing the roadless rule. How has the roadless rule 

96 

impacted the State of Alaska, and in your view, what actions 

should Congress take to address these impacts? 

Mr. BROWN. Alaska, of course, has sued and initially we were exempt from the roadless rule up there, but now we have it. 

For me it’s just another impediment. I don’t want to kick the 

Forest Service around too much because Congress has set up a lot 

of road blocks these guys have to navigate through, and the 

roadless rule is just another one. They’re making it a very difficult 

thing. Doesn’t really have any, I don’t know, concrete boundaries 

or anything in Alaska. So it’s just another impediment. 

Senator BARRASSO. My final question is to you, Mr. Vaagen. In 

your testimony you describe a decisionmaking process weighed 

down by litigation and top heavy environmental analysis. Consequently actual results to address poor forest health, wildfires, insect and the like never happened. One of your reform recommendations is arbitration. How would binding arbitration to dispute resolution foster real results to improve forest health? 

Mr. VAAGEN. Binding arbitration takes both parties closer to the 

center and comes out with the potential of a good decision. 

Senator BARRASSO. Thank you. 

Thank you, Madam Chairman. 

The CHAIRMAN. Thank you, Senator Barrasso. 

Senator Wyden, a leader on forestry issues in the Northwest. 

Senator WYDEN. Thank you, Madam Chair. 

This is an important hearing, and all of you have been very good 

because it is very obvious that all over the country citizens are saying that the Federal Government has got to do a better job in managing the forests. That is what I hear when I have town meetings 

and John Day in Medford and Brookings. I am sure all my colleagues are going to say the same thing. 

So here is what my concern has been, and it has really evolved. 

I was, not very long ago, the Chairman of this Committee and 

reached that judgment then and my sense is that it is just going 

to grow and grow with the concern. 

It seems that this debate is really presented as a choice that legislators have the option of either supporting a safety net for communities which is what we have done in this Committee through 

the Secure Rural Schools bill or getting the harvest up. In effect 

it is presented as either/or. I want to make it clear that I think our 

policy has got to be do both, and we have got to do both in a sustainable fashion. 

I have tried to do that in my state through what is called the 

O and C bill. The agencies, as you know, Mr. Bonnie, have indicated that it would double the harvest on average each year for 

half a century. Some dispute the agency’s analyses, but clearly we 

are trying to get the harvest up. 

The same is true with the safety net. In the Budget Committee 

we linked Secure Rural Schools with PILT and the Land and 

Water Conservation Fund and 18 out of 22 members said that they 

wanted to do that as well. So there is strong support for a vision 

that ensures that we get the harvest up and in a sustainable way 

and we have a safety net. 

So on that point, Mr. Bonnie, just one question. How high would 

the national and Oregon timber harvest have to go in order to no 

97 

longer need the safety net? You have heard me say we have got to 

do both—get the harvest up and we need a safety net. Some people 

do not agree with that. How high would the harvest have to go nationally and in my state in order to no longer need a safety net? 

Mr. BONNIE. So assuming a level of Secure Rural Schools in Fiscal Year 1914, I think nationally it has to go north of 

16,000,000,000 board feet annually, and I think in the State of Oregon it would have to go more than 3,000,000,000 board feet. 

Senator WYDEN. So that is what a three or four fold increase? I 

mean, make sure people walk away with this because there is this, 

sort of, myth out there that somehow we can get the harvest up 

high enough so you no longer need a safety net. I want people to 

see, and I spend a significant amount of time at every town meeting walking through this, that the numbers do not work. We are 

going to have to do both. So you just gave us the numbers in terms 

of the harvest. At what fold increase would that be? 

Mr. BONNIE. So in Fiscal Year ’14 the Forest Service harvested 

nationwide 2.8 billion board feet. This year we plan to hit 2.9 billion board feet. In Oregon I believe the figure was below 

500,000,000 last year, maybe 480,000,000, something like that last 

year. 

Senator WYDEN. So we are talking about a fivefold increase at 

least? 

Mr. BONNIE. Yes. 

Senator WYDEN. Okay. I only am excusing you other four because 

I have to run off and take care of some Finance Committee business. You all have been very good. 

I want to tell our Washington guest, I am very interested in all 

of the issues with respect to expediting litigation, and what we 

have done in all our bills is tried to create a fast track kind of process for people like yourself who want to be sensitive to environmental values. So I know a number of you have touched on that 

and we will want to followup. 

I would ask more questions if not for the fact that I have to get 

out the door. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator Wyden. 

Let’s go to Senator Risch. 

Senator RISCH. Thank you very much. 

Mr. Bonnie, you have heard all the discussion here about trying 

to get the harvest up, and I think everybody is in agreement that 

it needs to go up. I am not convinced that we have hit the sweet 

spot yet in finding the answer. 

A couple of things obviously are the provisions were in the Farm 

bill to treat certain lands. The Governors were to identify them and 

our Governor, I think it was about 1.8 million acres that he identified as insect and disease infested that needed treatment. What 

came out of that is we have got two projects, 3,500 acres, which is 

0.19 percent which is really diminimus in the overall scheme of 

things. So I do not know how that gets ratcheted up. I know that 

dollars are involved in that. 

The other, of course, is to me, a better route and that is the collaborative process. Now you and I were involved in a collaborative 

process that, I think, everybody should probably take heart in. By 

98 

the way, you have never been to this Committee testifying when 

I have been here, and so I want to publicly acknowledge your help 

on that and your agreement to stick with us through that. I have 

told that story over and over again that we worked on that collaborative when I was Governor. As you know, the states were asked 

to come up with a rule. We did for our roadless areas. 

We had over 9,000,000 acres, I have argued but actually I think 

outside of Alaska the biggest block of any state. We also had arguably the most diverse, and my argument has been if it can be done 

in Idaho it can be done anywhere. We were just like every other 

state. We had experienced 40 years of lawsuits that went absolutely nowhere, and we got a rule together that was only the result 

of the collaborative process. Without that that would have been absolutely impossible. 

We brought together, as you know, both the environmental community, the industry, the motorized, non-motorized users, and 

came up with a rule. Your part in that, of course, was the Administration changed right as we completed it and were in the process 

of litigation in the first round. And then you stuck with us, the 

ninth circuit. 

Idahoans will be forever in your debt and grateful for the decision you made to stick with us and not abandon ship, because there 

were a couple of groups that wanted to come to the table late, after 

they had been invited would be the kindest way to put it, to come 

to the table and try to do something, and they would not do it. 

So I am optimistic if the people will sit down and use the collaborative method. As you know, there are some secrets to it and some 

tricks to it, but that can be used to make it work. If they will do 

that, I think that is the best hope we have, really, of getting the 

numbers up. 

We have got some going on in Idaho right now. Some are doing 

okay, some not so much. I do not know whether you have a team 

within the Forest Service that can go out and coach these people 

when things are bogging down about how they can do better. I 

think that you guys really ought to focus on that because I think 

that is one of the ways that on a forest-by-forest basis you can get 

the numbers up. 

So I would like to see you focus on that and get a team together 

that can actually go out and do some rah rah with these people, 

particularly when it starts to bog down to get them going again. 

Mr. BONNIE. Well, thank you on Idaho roadless. I appreciate the 

kudos. But, you know, you deserve the lion share for that. 

If we’re going to support collaboratives we need to support 

collaboratives and that’s the position the Administration took on 

that. 

With respect to the insect and disease language we’ve moved 

quickly to designate those acres. Our challenge is that you’ve got 

Forest Service staff working on other projects. This year you’ll see 

some move out. 

I was in Idaho a couple weeks ago. I know there was an insect 

and disease project that was able to move from start to finish in 

four months. As we move forward we’re going to see a lot more of 

those projects, so I’m very confident that we’ll see more of those. 

99 

And I think, you know, Idaho has been real leader in collaboration. As I said in my opening remarks it’s not to say it’s a silver 

bullet, but I do think it will advance the ball substantially. Not 

only get more work done, but also in ultimately winning in court. 

The other thing I would say about your point about, sort of, making sure that we’re spreading the gospel, as it were, within the 

agency. We are trying to learn from whether it’s how to do NEPA 

better or other process improvements that we can spread across the 

agency because we have to. We’ve got fewer people to get the work 

done. 

Senator RISCH. Thank you, my time is up. Thank you, Mr. 

Bonnie, I appreciate it. 

The CHAIRMAN. Thank you, Senator Risch. 

Senator Hirono? 

Senator HIRONO. Thank you, Madam Chair. 

Mr. Bonnie, as you know, despite Hawaii being one of only ten 

states that does not have a national forest, the Forest Service does 

have a significant presence in our state. Hawaii, as probably a lot 

of people are unaware, has a large and increasing wildfire problem. 

As a percentage of acreage burnt, Hawaii is actually on a par with 

Western States and there has been a dramatic increase in the 

number of fires burning over 100 acres. 

Your testimony noted that the agency spends nearly half of its 

budget in fire management activities these days with that demand 

only expected to increase in coming years, and I appreciate the fact 

that Madam Chair has recognized that we should fix the fire borrowing situation. 

So I wanted to ask you do we need to tackle wildfire funding before any other management concerns can be adequately addressed? 

Secondly, can you expand on the strain that this lack of funding 

places on the Forest Service’s other programmatic obligations? 

Mr. BONNIE. So what I said in my opening remarks I think is 

true. Not to suggest that there aren’t other things to look at. 

Senator HIRONO. Yes, I understand. 

Mr. BONNIE. But if there’s one thing we can do to increase the 

pace and scale of restoration most quickly is to deal with the fire 

budget problem is having substantial impacts on the agency and on 

everything we do, forest management, restoration, recreation, research, all those things. And so the fire budget is critical. 

Senator HIRONO. I know that we have some members from the 

private sector. Would you agree that we need to get a better handle 

on part of the Department’s resources that goes for one thing, firefighting, and how can they adequately address some of the other 

issues that the rest of you have brought up without us making 

these changes? 

Anybody want to comment? 

Mr. VAAGEN. Our state, the State of Washington, had a massive 

wildfire in the central part of the state and it got away from them 

and a lot of homes burned. I think one person died, so it’s unfortunate, but the state recognized that we have to allow other people 

to participate. 

I think some good is going to come out of that that it can’t be 

just rock solid we’ve got to wait for the Forest Service to show up 

because they might be a long ways away when you can have 

100 

trained volunteer fire fighters that know the area. We’re going to 

see that blossom so that takes place. We can’t burn up 9,000,000 

acres and say it’s okay. 

Senator HIRONO. So you are talking about ways that we can 

work collaboratively prevent these fires? 

Mr. VAAGEN. This state. 

Senator HIRONO. But it takes up half the Administration’s budget, so—— 

Mr. VAAGEN. Yes. 

Senator HIRONO. I would say that that is a priority. 

Regarding invasive species role in wildfires. Hawaii is fighting an 

endless battle in controlling invasive species, and it is estimated 

that 24 percent of Hawaii State land cover is non-native grass and 

shrub lands that contribute to wildfire ignitions. Our native forests 

are not fire adapted, and we are seeing conversion of our forested 

areas to fire adapted invasive species such as wildfire adapted 

grasses. 

For example if you go to the Big Island you will see everywhere 

on the Big Island these kinds of grasses that are very prone to go 

up in flames. So additionally we are battling Albizia, a non-native 

tree that is known to persist in fire-disturbed environments. We 

had a tropical storm on the Big Island that brought down a lot of 

these Albizia trees, and they just come right back up. 

My question to our Under Secretary is can you discuss a little 

bit more in detail the Forest Service’s research and development 

priorities, specifically whether there is any priority given to controlling invasive species that either contribute to the growing 

threat of wildfire or thrive in areas damaged by wildfire? 

Mr. BONNIE. So this is a critical issue, and obviously it’s not just 

a critical issue in Hawaii. It’s a critical issue across the United 

States whether it’s Cogongrass in the South or Cheatgrass in the 

West. This is a huge issue for us, so Forest Service researchers are 

continuing to work on this. 

But it also has to be considered on the mainland as we deal with 

forest management plans, particularly post-fire restoration. This is 

a critical issue, and so both the research and knowledge about how 

to deal with that and then the ability to, kind of, adapt as we put 

management on the ground is going to be critically important for 

the agency. 

Senator HIRONO. Thank you. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator Hirono. 

Senator Flake? 

Senator FLAKE. Thank you. 

Senator Heinrich and I toured the forest in Arizona, the White 

Mountains, and in New Mexico in April of last year to look at the 

private industry that have came up really as a result in Arizona 

of the stewardship contracting. 

Mr. Vaagen, can you talk about that? Talk about some of the private industry that really came out as a result of the changes to the 

law, stewardship contracting, that came in after the RodeoChediski Fire and talk about your operation a little? 

101 

I apologize I was not here for your testimony at the beginning. 

You can just recap in terms of the importance of private industry 

in that area. 

Mr. VAAGEN. Yes, it’s interesting. We’re glad to be in Arizona. 

I’ve been going there for 30 plus years to industry association meetings and didn’t realize it had the largest contingent pine forest in 

the United States. 

We’ve learned that the small logs do have value. There are markets. There is need. The Rodeo Fire was nearly 500,000 acres that 

brought about the White Mountain Stewardship. 

We were asked to come down. We put a portable mill in operation which cost a couple million dollars. It does about 20 truckloads of logs a day which means about 20 acres will be thinned. A 

far cry from what’s necessary, but we also thought there would be 

at least a 5-year supply. 

On August 10th of 2014 the White Mountain Stewardship was 

done. We wrapped up within the month and sat there. Now we’re 

moving it to Snowflake because there is some timber up there 

available on some contracts. 

All the eggs were put into the 4FRI basket which is a good 

project. I commend the Forest Service on large landscape projects 

in Arizona or anywhere else, but you’ve got to make sure the collaborative process has the right people on board. 

The economics are important. That wasn’t looked at so it’s not 

even possible that’s why we didn’t bid. We had a mill that would 

treat 10,000 acres a year, and we thought that we could get up to 

40,000 acres a year. But if it’s a losing proposition, it can’t be done. 

So the concept is right. Collaboration just threw so much into the 

biomass equation which is the lowest value in what we call the 

value tree, so I still have hope for that. 

But I wanted to answer the other lessons learned. The product 

is good. We ship a lot of it to Mexico. Byproducts are not, not a 

lot of value there. You’ve got to go to pellets or power plants, but 

you can’t just build new power plants everywhere, so you’ve got to 

take these steps. 

Ten years is not long enough on a stewardship project if you’re 

going to set up an operation. It’s going to take 20 years and you 

need affordable, valuable timber which they have, but where are 

you going to get the money? And without assurance of 20 years I 

don’t know who is going to take that leap of faith, our leap was big 

enough. 

Senator FLAKE. That leads to my next question. How difficult 

will it be to convince private industry to come back if we can’t get 

these acres prepped for treatment now? I mean, having been 

burned once, so to speak, is it likely that we can get that kind of 

investment again? 

Mr. VAAGEN. We haven’t given up on Arizona. We’re going to try 

once more. We’re going to work with a few of the locals there to 

lease the mill out and get it to run for the next 2 years and see 

how this develops with 4FRI. We think that’s a good concept, but 

bringing anybody else in with less than 20 year contract and some 

kind of funding, I don’t see where it’s going to come from because 

just an assurance alone is not going to work. Your state is not 

unique but it is in need because of the fire situation. The Wallow 

102 

Fire was over a half million acres, so it’s one fire away from losing 

over a third of the big forest. 

Senator FLAKE. Right. 

Mr. VAAGEN. So that’s another concern. 

Senator FLAKE. Between the Wallow Fire and Rodeo-Chediski we 

lost about 20 percent of that Ponderosa Pine forest. Part of the 

problem is, you mentioned with the Wallow Fire, we had about 

50,000 acres prepped to go and that burned up, so the Forest Service has gotten, kind of, behind the eight ball after that and it has 

been tough to catch up. 

I appreciate your testimony and the efforts here and we are trying to save the rest of the forest. We know that unless we get in 

and treat and manage on a large scale then 4FRI, I mean, that is 

the biggie, that is the big one, and if that does not work, then future stewardship contracting really is out the window. So we have 

got to make it work. I appreciate it. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator Flake. 

Senator Heinrich? 

Senator HEINRICH. Thank you, Madam Chair. 

Mr. Vaagen, I will start and just say thank you for your comments, specifically on the timeframe issue in stewardship contracting. 

Senator Flake mentioned he and I have worked on stewardship 

contacting issues for a while now. We have toured some of these 

forests and some of the mills together, and the timeframe issue is 

something that I am sure we will be happy to look at as we continue this road toward more reform in terms of how we structure 

those contracts. 

I want to switch gears for a minute and ask a question of Under 

Secretary Bonnie. As we have heard, a lot of people have suggested 

doubling or even tripling timber sales in the next few years. My 

primary concern with that is that I do not want to see new funding 

and resources for the timber program come at the expense of existing programs that we are using in New Mexico to cut small diameter and fire prone trees. 

Unfortunately in this tight budget environment I think it is pretty safe to assume that the Forest Service will not be receiving extra 

appropriations to do this work so it is a bit of a zero sum game. 

So I wanted to ask you if the Forest Service budget is kept level 

what would the impact of those proposals be on programs that currently help us reduce catastrophic forest fires in places like New 

Mexico where we simply do not have a large timber program? 

Mr. BONNIE. Yes, so the challenge is, as I mentioned in my testimony, we’re, the agency, in some respects is maxed out. We see 

challenges on the recreation side, servicing people in recreation or 

doing watershed enhancement and conservation. We’re always 

making decisions about where best to put resources. 

And if there’s, you know, a requirement to have us move/shift resources toward one area and as you say, it’s a zero sum game, that 

could create challenges for us in other parts of the organization. 

And even things like, you know, we heard about 4FRI. 

We did have to sink substantial resources into 4FRI just as we 

did in the Rim Fire in California, and those forced us to not proVerDate Nov 24 2008 10:10 Aug 08, 2016 Jkt 094052 PO 00000 Frm 00106 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\94052\94052.TXT 94052
103 

vide as much resources as we would for other projects. So it creates 

a real challenge for the Agency. 

Senator HEINRICH. Well that, kind of, comes back to the whole 

fire borrowing issue. I think if we can come up with some proposals 

that actually seek to grow the pie as opposed to just take away 

from Peter, you know, rob Peter to pay Paul. I think we will see 

a lot more support for some of these changes on the Committee. 

I want to thank you, Mr. Owen, for your comments both on stewardship contracting which has been a really important tool for us 

in New Mexico but also water production. I say that because water 

is by far the most valuable forest product in New Mexico. 45 percent of New Mexico surface water starts in our National Forest, 

and without those watersheds our farm fields would be bare and 

biggest cities would be ghost towns. 

Next to water the most significant economic impact is what you 

just mentioned, Mr. Bonnie, that is recreational opportunities. 

Statewide 68,000 New Mexicans work in the outdoor recreation industry. Hunters and anglers alone spend $613 million a year in 

New Mexico, and outdoor recreation as a whole accounts for over 

$6 billion in spending in our state. When you compare that to current commercial timber contracts, we only sold $23,000 worth of 

timber contracts in New Mexico last year. 

So back to you, Mr. Bonnie. If Congress mandates minimum 

acreages of timber sales without increasing the overall budget and 

meeting those other needs, what would the impact be on watershed 

restoration projects and also recreational facilities and permit programs that jobs in New Mexico rely on? 

Mr. BONNIE. It would be no question they’ll be a negative impact. 

If you read the Forest Service clips, which I do every day, you’ll see 

there are places where we have law enforcement investigation positions open. There are places where we’re closing campgrounds. 

Those are an indication of the stress that the agency is under 

just as we’ve shifted resources slowly over time from our broad 

mandate more and more into fire, and we’re having to make 

optimus choices all the time. 

Senator HEINRICH. So would you say it is fair to characterize the 

situation that unless we fix the fire borrowing program or the fire 

borrowing problem that we are going to be playing the zero sum 

game of chasing one program or another as opposed to bringing the 

necessary resources to manage forests overall? 

Mr. BONNIE. I think that’s largely the case. I do think there are 

areas where we can continue to improve efficiency, but ultimately 

we can only wring so much efficiency out of the machine. We’ve got 

to fix the fire budget. 

Senator HEINRICH. Thank you. 

The CHAIRMAN. Thank you, Senator Heinrich. 

I think that that is one area that we all are in agreement. We 

have got to deal with this reoccurring problem with the fire budget. 

Know that we are focused on that. 

Let me pick up where I left off. 

You had mentioned the CMAI waiver and what flexibility that 

might provide to you. I noted that given the rotation age in the 

Tongass of 92 to 100 years and given where the harvest has been 

historically since the early 60’s along the beaches and along the 

104 

streams that we are not there, even with the waiver of CMAI because the oldest of the young growth just is not ready. Given that 

and just from a practical perspective, how does this departure from 

CMAI actually increase the volume of economic second growth timber that is available for harvest out of the Tongass? 

Mr. BONNIE. So we’ve got a timber sale right now, Dargon Point, 

that you may be familiar with. It’s a 70-year old stand that there’s 

been a lot of interest in. We put it out for bid and there were a 

lot of folks that came forward. 

All of that to say that not every stand is a Dargon Point, but that 

there is interest if we can put good, young growth stands up that 

they will be younger than 90 years old or 100. 

One of the things we’ve asked the Tongass Advisory Committee 

to do is really to delve into the numbers here, to look at the available second growth, where it is, how fast it comes on board and the 

types of things that we can look at to potentially expand the land 

base where we can get second growth. I think that analysis of the 

Tongass Advisory Committee is important, and I think that’s going 

to be a critical part of the work we do around the Tongass Land 

Management Plan Amendment as well. 

The CHAIRMAN. Let me ask you a question, Mr. Brown. In your 

view what would the timber industry in the Southeast need to 

make a successful transition to harvest to second growth and how 

long is it going to take? 

Mr. BROWN. To answer that question I think I would focus less 

on the volume. I don’t really agree with the CMAI making more 

volume available. But the bigger thing for me is there’s only, we 

only have one sawmill left of any size, and it’s an old growth mill. 

So basically what you’re talking about when you transition to second growth is you have to retool. 

The CHAIRMAN. Right. 

Mr. BROWN. That’s going to take significant investment, and in 

my opinion nobody is going to make any significant investment of 

the size we’re talking about and rely on the U.S. Forest Service to 

supply that timber based on their track record. 

The CHAIRMAN. I have had exactly those conversations with Kirk 

Dahlstrom about the investment that it would take. You simply 

cannot utilize what he has in place there at Viking with a younger 

than second growth timber. It does take retooling. The investment 

is considerable. There is this tradeoff here between, well it is a financial tradeoff, absolutely. The question is whether or not you can 

rely on them. 

You mentioned that you would be speaking to Mr. Dahlstrom’s 

testimony. As I read through it, it is a pretty sad story. The owner 

of the only remaining midsized sawmill operating in the state has 

no other reliable sources of timber supply. He is supporting over 

150 jobs within the state but our mill in Alaska is almost out of 

logs now. We currently have only about two months supply in the 

log yard. 

Then in the plating that was filed in the U.S. District Court he 

speaks to the issue of litigation and delay and says, ‘‘Even though 

the lawsuit was found to be without merit in four legal opinions, 

the litigation delayed operations on this sale, consumed Viking’s financial resources and made planning mill operations and general 

105 

conduct with business very difficult.’’ That was as it related to the 

diesel sale. But it just speaks to what we see time and time again 

where it seems to be that delay caused by litigation goes on and 

on and on and the very lifeblood of these smaller operators is just 

being sucked dry. 

Let me ask very quickly a question of you, Mr. Brown. So many 

have come to the conclusion that the existing management structure does not work. The only solution is to remove some of the existing timber lands from Federal control. There have been a lot of 

different variations on this idea, but the Alaska Forest Association 

has a state forest concept. The Governor’s Timber Task Force has 

recommendations, but you are looking to that alternative management model within the state of an Alaska State Forest. Can you 

speak very quickly to the benefits of that, the merits of that rather 

than hoping and praying you are going to get a source from the 

Federal side? 

Mr. BROWN. Right. Well, real quickly, I would point to the State 

of Washington which has, I think, about a two and a half million 

acres under state control. And it’s got to be the most successful 

state timber sale program in the whole nation. And when the Timber Task Force was a part of an AFA looked at that, that was kind 

of a model we looked at was the way the DNR in Washington manages our forest. It provides certainty for operations. All the timber 

is competitively bid, but it’s a very good program and I would encourage anybody to look at that program as a model. There’s good 

protection for fish and wildlife and everything, you know, that you 

would hope for, but it also provides sustainable timber for the timber operators in that state. 

The CHAIRMAN. I appreciate that. 

Mr. Bonnie, is the Administration willing to work with us on 

some alternative management models? 

Mr. BONNIE. Well, I think we work with a number of Governors 

in a number of states. Obviously, we are happy to followup and 

have conversations. Chris Maise, she’s been a great partner of ours 

up there and we are happy to have conversations. 

The CHAIRMAN. We look forward to having that conversation. 

Senator Cantwell? 

Senator CANTWELL. Thank you, Madam Chair. 

I know while I was gone a couple of people mentioned pellets 

again, including Mr. Vaagen, so thank you. I am proud that 

Colville is the home to one of these premier wood stove companies 

that has changed the way pellets can be burned. One of the things 

that we want to do is increase, as you were saying earlier, more 

21st Century uses. Mr. Owen was also talking about that. 

But one of the things I wanted to ask about is the small business 

set aside. Because if the small mills are doing the restoration and 

that kind of restoration can lead to some of these projects that are 

the value add for the lower end value timber, then don’t we need 

to make sure that the people have the set aside so that they can 

actually keep producing if they are playing that key role in the 

product stream? 

Mr. VAAGEN. It’s a delicate question to answer because I’m the 

chair of FFRC and AFRC, but I can tell you historically small business knew what that was about and that’s how they projected their 

106 

growth and their predictability and their stability of supply. So, 

yes, we think that still has to be recognized on the stewardship 

component. As a small business we really think that’s equitable. I 

would add that what I’m hearing here, all the byproducts are important and we are looking at pellets. We just started bailing 

shavings and they all go to Colorado for some reason. And it’s a 

very good product and high value. So markets are markets. 

But as an industry our groups agree that we don’t need to be at $16 billion or $12 billion where we were in the 80’s but somewhere 

in the neighborhood of $6.2 billion. As I look at this in a zero sum 

game I’m seeing a new way of doing business. In other words, if 

we burn 7,000,000 acres a year or more, we’re not even going to 

salvage, restore, 10 percent of that. 

If you did 300,000 acres that would be 1.5 billion feet, if you aggressively went out in front of the fires and projected where you 

wanted to thin and treat that would be 1.5 billion on 300,000 acres. 

That doesn’t even keep us current with growth and mortality. So 

there’s other ways to skin a cat is what I’m saying. So, thank you. 

Senator CANTWELL. Yes, I appreciate that. I do think there are 

different ways to look at this in calculation and certainly on keeping the forest healthy in general is a very good idea. 

I appreciate Mr. Owen’s testimony about these products and 

where they can go and what their use is. We have members of this 

Committee who have huge wood stove installations and are paying 

through the nose for home heating oil, so solutions like this would 

be winning solutions for them. 

I have to ask you, Mr. Bonnie, is the YWCA going to get a permit 

by the end of this year to be able to take people out on recreation 

land? 

Mr. BONNIE. So we’ve met with the folks from the YMCA. I know 

their frustration on this issue. I think we’ve also met with other 

folks on the Recreation Committee. This is an issue we want to resolve. I don’t know whether it takes a change in our handbook or 

whatever, but I think we very much want to work with you and 

your staff to solve this problem. 

Senator CANTWELL. Is that something you think we can solve by 

the end of this year? 

Mr. BONNIE. Depends on, sort of, what it requires us to do, but 

what I will say is we will try and move as quickly as we can. 

Senator CANTWELL. Thank you. We are definitely going to stay 

on this. 

So, thank you. 

The CHAIRMAN. Thank you. 

Senator Daines, I know that we cut you off in mid-question, so 

have at it. 

Senator DAINES. There is so much to talk about, Madam Chair, 

and I thank you for your comments too, about Alaska. What you 

share there sounds a lot like what is going on in Montana. There 

is a sense of urgency needed to change this process. 

When I was back home a couple weeks ago mills were telling me 

that they are running at two-thirds capacity. We only have 11 left, 

we used to have 30, and they are running at two-thirds capacity. 

I asked them what are the constraints, and they said, ‘‘logs.’’ We 

cannot get enough logs to keep running these mills. There is plenty 

107 

of demand, so this nonsense that is out there that says the reason 

the mills are not running at full capacity is because of lower demand is absolutely false. The demand is there, but we do not have 

logs. 

We are importing logs in Montana from Canada right now to 

meet some of our mills requirements. And these students from 

Libby High School, there is a reason they are called the ‘‘Libby 

Loggers.’’ We had four or five mills in Lincoln County once upon 

a time, and now there is not a major mill in Lincoln County and 

we are surrounded by, what is it, 78 percent of Federal lands there 

and we cannot access the logs to keep our mills going across the 

state. So we cannot accept the status quo. We have got to drive 

change here. 

Back to Secretary Bonnie and that line of questioning around reforms I think we need. I too, echo, I think, the support we have 

on both sides to reform the way we fund wildfires. That just seems 

to be common sense. I do not know how you can effectively manage 

your budget with the uncertainty with the wildfires, and I hope we 

can move something forward there that will help everybody involved. 

Back in terms of some of these ideas on reforms, Secretary 

Bonnie, simplifying the environmental review for timber sales in 

suitable timber lands that the National Forest has in their plans 

which have already gone through extensive public review, explicitly 

establishing harvest as the primary objective, is that something we 

can work on? 

Mr. BONNIE. So, I think we’re very interested in looking at ways 

that we can streamline. Obviously the Farm Bill language will help 

us do that. I think we want to continue to work with these 

collaboratives and look at, you know, larger landscapes that both 

provide a suitable or a timber supply to local mills as well as satisfying other stewardship objectives. 

Senator DAINES. I know when Chief Tidwell was up here he 

talked about the impact litigation is having on the Department. In 

fact he said that the litigation diverts staff. There is a lot of time 

and money being spent right now in fighting litigation. What about 

replacing litigation with a binding arbitration process? 

Mr. BONNIE. So I think we’ve tried to be as creative as we can 

on NEPA. We’ve used alternative arrangements in place, and I 

think we’re interested in discussing pilots, those types of things, on 

NEPA and would appreciate a conversation around that. 

Senator DAINES. We have had hearing after hearing when I was 

on the House side, and now in the Senate, that we keep circling 

the airport here, and that airport that we need to land the plane 

on is the issue of litigation seems to be core, the obstruction that 

is going on here, stopping our mills from having access to having 

a responsible harvest in the forests. How about requiring litigants 

to post a bond to pay for the Federal Governments legal expenses 

in the event the litigant loses in court? 

Mr. BONNIE. So, you know, there’s a broader issue for the Administration. I think we’ve made a lot of progress in litigation. Your 

State of Montana has had real challenges. You’re right with respect 

to impacts on Forest Service staff or just having to do more work 

to ensure that timber projects move forward. 

108 

Senator DAINES. But what is wrong with requiring the litigant 

to post a bond? 

Mr. BONNIE. So I don’t want to—you know, the Administration 

doesn’t have an opinion on that. I don’t want to get out of in front 

of myself here. Just to say that I think we recognize there’s a challenge here and think that the collaboratives are an important way 

to move forward on this issue. We’re winning more cases now, but 

we’ve still got a ways to go. 

Senator DAINES. Yes, well, we are going to keep working these 

forums. I would like to see us look at some of these changes because again, we are going to have the same outcomes. We will be 

in these same hearings five years from now probably looking at the 

same numbers unless we fundamentally change up the way the 

process is working or, should I say, is not working today. 

You mentioned the Farm Bill. What about billing on the 2014 

Farm Bill to give states a greater role, giving the states a greater 

role in determining timber projects on National Forests that should 

be given priority? 

Mr. BONNIE. So we’re working with Governor Bullock in your 

state. We’re working—— 

Senator DAINES. And we are tied up in court now by the way in 

the first—when we tried to put out of place we are now—it is now 

been objections filed on it. 

Mr. BONNIE. Yes—— 

Senator DAINES. In fact the litigation issue the bonding, the arbitration, if we do not change that, I am just pessimistic we will ever 

solve this problem. 

Mr. BONNIE. I do think, to your point about working with Governors, I think we’re very interested in that. There are opportunities, not just through Good Neighbor Authority, but in other things 

as well. 

Senator DAINES. Right, good and I appreciate it. I think that is 

definitely a step. 

Mr. BONNIE. Critical. 

Senator DAINES. Forward we have here. 

How about also if given the flexibility in resource to do your job 

would you support establishing timber sale requirements that are 

based on National Forest plans similar to the concept Commissioner Peck said has proven valuable in Montana? 

Mr. BONNIE. So here’s my caution here. What I think is working 

now are these large scale collaboratives. I worry if we start to impose top/down requirements on those. To me what’s working is bottoms up. 

We need to think bigger and clearly get more work done. 

There’s—absolutely acknowledge the need to do more work. And so 

that’s my caution. 

Senator DAINES. Yes, and our concern of course, is I think Commissioner Peck mentioned it. It is like having a football game without a scoreboard. We have got to keep score here and quantify this 

at the end of the day. 

Mr. BONNIE. You’re right, and nationally we have said we’ve 

been very clear about wanting to north of 3,000,000,000 board feet 

nationally and to treat more acres nationally. We think the fire fix 

109 

as it’s laid out, and we appreciate your leadership on that, will get 

us above that. But you’re right we need to get more work done. 

Senator DAINES. Thanks, Secretary Bonnie, thank you for your 

thoughtful comments. I look forward to continuing to work on this 

problem and solve it. 

Thanks. 

The CHAIRMAN. Thank you, Senator Daines. 

We have got a lot in common between your state and the State 

of Alaska and the state of the timber industry which is really 

struggling, really struggling to the point where some wonder if it 

can hang on at all. 

Mr. Bonnie, I appreciate the very brief comments that you made 

at the end there about a willingness to work with us on an alternative management model based on national Forest System lands, 

maybe some demonstration pilots. But my perspective at this point 

is we have got to give the state and our forest professionals the 

ability to take the lead to see if we can responsibly get the timber 

harvest up in the Tongass. We have to figure out a way forward 

to address the concerns that Mr. Dahlstrom has made in his written testimony to address the concerns that Mr. Brown has presented here today. 

So I want to have further discussions with you specific to this 

point, and I appreciate the leadership that our new Governor is 

making with the proposals on the support that we have coming out 

of the state as well. 

A lot has been raised here today, but clearly I think we have 

agreed that we have got to deal with the fire borrowing problem. 

We must address that. 

I think we also recognize that we are dealing with a maze of 

laws and regulations that while perhaps taken individually might 

be workable, collectively it is very difficult in implementation. You 

have these layered effects. You have the environmental laws along 

with expansion of statutory requirements by regulation, by judicial 

decisions and the term that I used in my opening statement was 

‘‘analysis paralysis.’’ It seems that so much of what we see happening here where there’s a lot of talk. 

We are talking about collaboratives. We are talking about planning and assessment. But at the end of the day it seems that we 

still have just, kind of, a failure to be able to move. Again, it is not 

just about a process. It has to be about some results. This is where, 

I think, so much of the frustration is. 

I would like to also continue some discussions with you on the 

retooling and the assistance. I would just as soon that we do not 

need that assistance. I would prefer that we get to the point where 

we have the available timber so that our small operators can be 

working. But that is not where we are right now, and there have 

been a lot of promises made that, again, we really have not seen 

the backing behind that. So know that that also is an area that we 

need to be working with the Administration on. 

Senator Cantwell, any further comments? 

Senator CANTWELL. I will just say thank you again to the witnesses for being here, and I look forward to working with them and 

you and our Committee on this legislation and the opportunities as 

we move forward. 

110 

The CHAIRMAN. Good. Thank you. 

With that, gentlemen, thank you for coming before the Committee and safe travels back home. 

[Whereupon, at 11:58 a.m. the hearing was adjourned.] 

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