SENATE BILL REPORT

SB 5563

BYSenator Zimmerman

Modifying the determination of sustainable harvest.

Senate Committee on Natural Resources

Senate Hearing Date(s):March 3, 1987

Senate Staff:Vic Moon (786-7469)

AS OF FEBRUARY 27, 1987

BACKGROUND:

The Department of Natural Resources manages 2.1 million acres of timberland for the state trusts which were created at the time of statehood.  The Department sells timber from these lands on a sustainable harvest basis which means that timber is propagated and sold so that a harvest may be sustained in perpetuity.  State managed lands provide funds for construction of school buildings, university construction, construction on the capitol campus, social and health services activities and county operations.

During the period from 1977 to 1981, private purchasers bid high prices for timber on state trust lands.  From 1980 through 1984, there was a severe reduction in the demand for lumber because of a nationwide depression in the housing market.  Sales of timber on state lands became financially inoperable for the private owners and as their contracts reached expiration dates, the purchasers defaulted on them.  The quantity of timber defaulted during this period amounted to about 1.1 billion board feet.  During the early 1980s, the Department chose not to sell a portion of its planned timber sales due to the low bid prices. The quantity of timber deferred from sales amounted to .6 billion board feet.

SUMMARY:

Adequate funding of construction for state educational facilities represents a high state priority for the use of money from state owned lands.  Existing facilities need replacement and the sale from state owned land plays a key role in supporting the construction of school facilities.  The Department of Natural Resources sells timber on a sustained yield basis.  Since 1980 purchasers defaulted on sales contracts affecting over 1 billion, 100 million board feet.  Between 1981 and 1983 the Department sold 600 million board feet of timber less than the sustainable harvest level.  As a result of the two actions, the Department entered their 84-93 planning decade with a timber sale arrearage which could be sold without adversely affecting the continued productivity of the state owned forests under the sustained yield management program.

Definitions are included as follows:  (1)  arrearage means the summation of the annual sustainable harvest timber volume since July 1, 1979 less the sum of state timber sales contracted default volume and the state timber sales volume deficit since July 1, 1979; (2) default means the volume of timber remaining when a contractor fails to meet the terms of the sales contract; (3) deficit means the total of the difference between the Department's annual planned sales program volume and the actual volume of timber sold; (4) planning decade means the ten-year period covered in the forest land management plan adopted by the Board of Natural Resources; (5) sustainable harvest level means the volume of timber scheduled for sale from state owned lands during a planning decade as calculated by the Department.

The Department of Natural Resources will manage state owned lands on a sustained yield basis and shall periodically adjust the acreages designated for inclusion in the sustained yield management process and calculate a sustainable harvest level.

If an arrearage exists at the end of any planning decade, the Department shall offer for sale the arrearage in addition to the sustainable harvest level adopted by the Board for the next planning decade.

Fiscal Note:      requested