Washington State House of Representatives Office of Program Research	BILL ANALYSIS
Natural Resources Committee

HB 1835

Brief Description:  Creating a forest products commission.

Sponsors:  Representatives Doumit, Sump, Schoesler and Clements.

Brief Summary of Bill

$Authorizes creation of a forest products commission for the purpose of promoting Washington forest products and managed forests, and assisting in research related to marketing, advertising, or sale of forest products, or research related to managed forests.

$Creation of the forest products commission requires a positive vote by the required number of producers.

$Participation in the forest products commission is limited to producers who grow and harvest timber in Washington state.  The harvest level must be at least 2 million board feet a year, as evidenced by payment of the timber excise tax.

$An assessment may be imposed upon producers within a range of 45 cents up to 90 cents per thousand board feet.  All assessment increases must be approved by a referendum of producers.

$The initial assessment rate is established at 57 cents per thousand board feet.  The initial assessment is voted upon by the producers at the same time as the proposal to create the commission and to elect the initial commission members.

$The commission consists of nine voting members.  Six of the members must be from Western Washington, two of the members must be from Eastern Washington, and the remaining member may reside in either Western or Eastern Washington.

Hearing Date:  2/23/01

Staff:  Bill Lynch (786‑7092).

Background: 

Several commodity commissions were established in statute to help research and promote particular Washington products.  These include the Washington Wine Commission, Apple Advertising Commission, Dairy Products Commission, and the Hardwoods Commission.  These commissions elect their own governing board members and impose assessments on their members to finance activities deemed necessary.

Although there is a Hardwoods Commission, there is no broader commission that encompasses all producers of forest products.  Other states, such as California, have created a forest products commission.

Summary of Bill: 

A forest products commission may be established for the purpose of promoting Washington forest products and managed forests, and assisting in research related to marketing, advertising, or sale of forest products, or research related to managed forests.  The commission is directed to create, provide for, and conduct a research, promotional, and educational campaign as sales and market conditions reasonably require.

Membership.  The commission consists of nine voting members.  Six of the members must be from Western Washington, two of the members must be from Eastern Washington, and the remaining member may reside in either Western or Eastern Washington.  The commission may also add or remove nonvoting ex officio members to the commission.  The commission members are elected by a vote of the entire group of producers unless the commission establishes districts for the nomination and election of commission members.  If commissioner districts are established, the one commissioner who may reside in either Eastern or Western Washington is elected as an at-large member by the entire group of producers.

Three of the members from Western Washington must have annual harvest of more than 75 million board feet, and the other three members form Western Washington must have annual harvests between 2 million board feet and 75 million board feet.  One of the members from Eastern Washington must have an annual harvest over 75 million board feet, and the other member from Eastern Washington must have an annual harvest between 2 million board feet and 75 million board feet.

Each member must currently and for the five years preceding his or her election be actively engaged in producing forest products in the state, and meet the requirements for a ?producer@.  A producer is someone who grows and harvests timber in Washington state, and the harvest level must be at least 2 million board feet a year, as evidenced by payment of the timber excise tax.

No more than one member of the commission may be employed by or be connected with in a proprietary capacity with the same business organization.  Members of the commission must be citizens and residents of the state, and be over 21 years of age.  Each member must also derive a substantial portion of his or her income from the production of forest products.

Commission members are elected for four-year terms.  The initial commission members are elected to staggered terms.  Each member of the commission is compensated up to $35 per day when engaged in business of the commission, and is reimbursed for actual travel expenses.

Assessment authority and approval.   An assessment may be imposed upon producers within a range of 45 cents up to 90 cents per thousand board feet on each species of forest products.  All assessment increases must be approved by a referendum of producers.  The assessment is to be established for the marketing year no later than January 1st of each year, or as soon thereafter as possible.  The commission may increase assessments in excess of the fiscal growth factor established in statute for fee increases.

The initial assessment rate is established at 57 cents per thousand board feet.  The initial assessment is voted upon by the producers at the same time as the proposal to create the commission and to elect the initial commission members.

An assessment is considered approved if : (1) At least 51% of the number of  producers participating in the referendum vote in favor of the assessment, and these producers represent at least 61% of the volume of the producers who participate in the referendum; or (2) At least 65% by numbers of producers participating in the referendum vote in favor of the assessment, and these producers represent at least 51% of the volume of the producers replying in the referendum.  At least 40% of the eligible producers must participate in the referendum in order for an assessment to be approved.

An assessment is due and payable to the commission when the commission calls for payment.  The assessment becomes a personal debt of the person assessed.    If a person fails to pay an assessment when it is due, the commission may add to the unpaid assessment  an amount not to exceed 10% of the assessment to pay for the cost of collection.  If a person fails to pay an assessment, the commission may bring a civil action in court for collecting the sum.

Funds collected by the commission may be deposited in a separate account in the commission=s name in any bank that is a state depositary.  Expenditures and disbursements may be made from the account without an appropriation.

Election process.  The Director of the Department of Agriculture must call an initial meeting of forest product producers for nominating people to serve as commission members.  The Department of Revenue is required to provide the director with a list of all qualified producers in the state based upon the department=s tax records prior to the meeting.  Any producer may be nominated orally at the meeting for membership on the commission, or may be nominated by a petition filed with the department that is signed by at least five producers.  The initial member are elected by secret mail ballot under the supervision of the director.  At this initial election, the producers will vote on whether or not to create the commission, the initial slate of commissioners, and the initial assessment.  If the requisite approval is not obtained for creation of the commission, the provisions of this law are inoperative.

After the initial election of commission members, the commission is directed to establish procedures for conducting elections.   The commission is directed to hold its annual meeting each October for the purpose of nominating commission members and transacting business.   Prior to receiving nominations, the Department of Revenue must provide the commission with a list of all qualified producers within the state based upon the department=s tax records.

Appropriation:  None.

Fiscal Note:  Available.

Effective Date:  Ninety days after adjournment of session in which bill is passed.