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Counties gain revenue compensation for encumbered state forest lands | State Legislature

Some local governments in Southwest Washington have dealt with sporadic timber revenues and therefore uncertain budgets due to a lack of access to portions of state forest lands encumbered by endangered animal species.

Now these governments are on the path toward fiscal sustainability.

House Bill 2329, which was unanimously voted out of the Senate Energy, Natural Resources and Marine Waters Committee on Friday (Feb. 17) after it passed through the House Feb. 9  without dissent, is the second step in a process that began three years ago. It’s an attempt to create more dependable revenue streams for counties dependent on timber harvests from state forest land now protected under state and federal  endangered species laws.

“This is just one step to move in the right direction to compensate the small timber-counties to keep us viable,” said Daniel Cothren, chairman of the Wahkiakum County Board of Commissioners. “But it’s a crucial step.”

“This bill gives the opportunity for counties to reap the benefit of their lands, which have been off limits to harvest, by doing a swap. It allows for revenue opportunities that are currently denied because of ESA. It’s a simple yet important fix for affected counties,” said Rep. Ann Rivers (R-18th, La Center).

The legislation would allow qualifying counties in Southwest Washington, most notably Wahkiakum, Pacific and Skamania, but also Klickitat, to pool the $2 million already appropriated to the counties from the 2011-2013 capital budget, via 2009’s HB 1484, and purchase replacement lands within any of the eligible counties.

Rep. Dean Takko (D-19th, Longview), the bill’s main sponsor, said that blocked-off land causes too much variability in the counties’ general budgets from year-to-year.

“One year they may have some fine harvest and the budget looks great,” he said. “But the next year there’s no harvests scheduled because the land that maybe could have been logged is the land that’s encumbered. Now, all of the sudden, they have literally nothing out of the trust lands. It’s a big, big hit into their current expense fund.”

Of the 623,000 acres of county trust lands in Wahkiakum, Pacific and Skamania counties, 7,500 are inhabited by either Marbled Murrelet or Northern Spotted Owl, protected by the Endangered Species Act and off-limits to loggers.

The ESA restriction has a disproportionate effect on the counties, explained Josh Weiss, Washington State Association of Counties policy director for natural resources, environment and land use.

“Those three counties have a very limited property and sales-tax base,” he said. “So you have this double impact where you have a lot of habitat, a lot of lands that are off limits and at the same time, it means more than it does to other counties.”

A 2004 study found that income from timber production on state forest lands equaled almost a quarter of total revenue collected through the general property tax in both Pacific and Skamania counties, while it represented 4 percent more than the total revenue collected through the general property tax in Wahkiakum Count, said Weiss.

Cothren said that his county has tapped into $8 million in reserve funds to supplement the budget during depressed timber years since he took office in 2000, but that surplus money has run out.

“Right now we’re tapping into our road fund to get by and that’s basically unheard of because, for a small county we’re rich in resources,” he said. “If we didn’t have the endangered species, we would be quite fine, but right now these lands are set aside and you can’t touch them. We don’t have a big enough timber-base to actually move around.”

Should the bill pass, Cothren said Wahkiakum County would only look toward purchasing 3,000-5,000 acres of private forest lands, just enough to compensate for what it has lost without compromising the current forest excise tax base.

Takko said that, with a funding mechanism for the replacement lands already in place through HB 1484, more money will come as the state regains its overall economic well-being.

“It’s not much money [currently appropriated for replacement lands], but as money becomes available then this gives them the opportunity that they’re not constrained to just going to try and find land in their own county,” said Takko.

“In Wahkiakum County, we might have more opportunities to purchase timberland here than they would maybe in Skamania or maybe in Pacific,” said Cothren. “This way if we see a nice piece of timber that’s going to be put up for sale then we can pool up our money and put it together and be able to purchase these lands.”

The pool would be set up so that revenue is distributed proportionately to the amount of investment made by each county, said Takko.

He also said participation is voluntary, though he expects all of the qualifying counties to be on board since they similarly struggle to find timberland in their own counties.

Weiss said the counties began acquiring forest lands during the 1930s through tax foreclosures and eventually turned them over to the state in a trust managed on their behalf by the Department of Natural Resources.

“It’s our priority to manage these lands sustainably and also to produce revenue for these beneficiaries and we take that responsibility very seriously. When we see opportunities like this to do just that, we think that’s kind of a win-win situation,” said Andrew Hayes, policy specialist with the Office of the Commissioner of Public Lands.

Hayes said that the legislation even has support from multiple environmental groups that “think it’s a great, creative solution to this problem.”

“This really gets at properly classifying state public lands,” said Bill Robinson, director of state government relations for The Nature Conservancy. “If these are lands that are currently on the harvest-base for revenue generation and they’re never going to produce revenue because they have endangered species on them, they should be put into the proper classification that they are conservation lands. And to make the counties whole, transfer the value of its conservation lands into other properties that are available for the county to generate revenue from.”

While the bill doesn’t explicitly reclassify the encumbered lands, Robinson said that it creates the ability to do so.

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