On Jan. 11, 16 inmates walked away from the Lane County jail into Eugene, Ore. By the end of the week, 127 had been set free, and by April, the number spiked to more than 1,200. Most were repeat offenders accused of crimes including burglary, assault and rape. Some were already convicted, their sentences only partly served, but the majority were released before trial because the county, faced with massive budget cuts, couldn't afford to keep them locked up any longer.

Josephine County, two hours south, faced the same problem last May when residents voted down a tax to fund the prison, and 39 inmates were released in Grants Pass. With county sheriffs' departments cutting staff and crime rates rising, locals took the law into their own hands. County residents formed what they call the Citizens Against Crime Patrol, taking to the streets armed with guns and zip ties and flashing lights on their trucks to look for suspicious activity, according to The Associated Press. Officials say it stops just short of vigilante justice.

These are the harsh realities of the current economic collapse in O&C country. Lane, Josephine, Curry, Coos, Douglas -- the counties with the most federal land -- have had it worst, struggling to fund basic services that were once supported by federal timber revenue and now rely on falling federal payments. The kneejerk reaction is often much like Eells': Blame the spotted owls and environmentalists. Yet even before the spotted owl became an issue, the Northwest's timber industry was declining. Loggers had gutted old growth so quickly that harvest levels would inevitably drop. Meanwhile, as logging became more mechanized and mills automated, longtime workers were cast aside.

After the Northwest Forest Plan went into effect, some communities made a genuine effort to create a new economy. Ashland became a center for the arts. A semiconductor factory opened in Eugene, Lane County's economic hub, but shut down in 2008. Other areas were able to take advantage of protected federal land to attract tourists and retirees seeking open space and a better quality of life -- part of the broader shift to a service economy. But communities lacking those resources continue to struggle.

To help them out, in 2000 Congress extended the spotted owl payments with the Secure Rural Schools and Community Self-Determination Act, which increased aid and stretched the safety net for six more years. Since 2006, shrinking extensions of the law have squeaked through Congress. So far, though, the effort to wean these counties off the federal dole -- and away from diminishing timber dollars -- has mostly flopped.

Between 2008 and 2011, falling payments made up almost a quarter of Douglas and neighboring Josephine counties' revenue. Lane County, home of Eugene's University of Oregon, faced a $100 million shortfall last year, thanks in part to the payment drop.

And locals haven't done much to help themselves, either. Like many other Western areas packed with federal land, these counties tend to be fiercely anti-government. Laws passed in the 1990s effectively locked in low property tax rates, making it even harder for counties to pay the bills. Over the last dozen years, Lane County has tried to raise taxes 14 times. Each time, voters said no -- perhaps not surprising, given recent unemployment rates of more than 12 percent. Josephine County has the lowest property tax rate in the state, and still residents won't approve taxes to pay for basic services.

The Secure Rural Schools payments have expired, and the program's renewal seems unlikely. The last checks to counties were withheld by the BLM under the federal budget sequester in February, and now the Forest Service is demanding that counties return the checks it sent out in the new year, infuriating Oregon's congressmen. Other federal safety nets are sure to be cut back under Washington, D.C.'s budget-trimming frenzy. Without payments, county budgets will once again be tied directly to federal timber harvest, providing a fraction of the revenue.

To make matters worse, what remained of the timber economy -- fueled mostly by logs from private land -- was battered by the recession. The national housing bust snuffed domestic lumber demand. Unemployment soared to 16 percent in Douglas County following the 2008 crash, far worse than during the timber-cutback years of the early '90s. Swanson Group mills in Glendale, Roseburg and Springfield laid off over 700 workers between 2007 and 2009.

Still, environmental protections have undoubtedly added to the economic hardship. And as the housing market sputters back to life, and demand for timber revives, the pressure to log federal lands will likely revive, too. But getting the cut out may be even harder than before. In March, the American Forest Resource Council and others sued to overturn the new critical habitat plan, saying that even the call for active management, which would allow limited logging, is "a hollow promise."

Franklin says the recent critical habitat protections are another example of the Northwest Forest Plan being hijacked. "I see it as a major change in the social contract that was the Northwest Forest Plan," he says. "Societies need to be as healthy as the forests. If they aren't, you are going to be in trouble."

Today, Glendale is a shadow of its former self. Sprinklers still spray piles of logs -- mostly from private land -- in the September sun at one of two Swanson Group mills. But the mills operate below capacity and employ mostly out-of-towners from larger communities with more amenities on the Interstate 5 corridor. "The downward spiral this community is in is going to be tough to reverse," says Steve Swanson, the fourth-generation owner of the family business.

Empty storefronts line the main street, and most of the shelves at the SuperStore grocery are bare. A bulletin board at the bookstore, which doubles as a coffee shop and lumber outlet, says, "We read to know we're not alone."

"We live in a land of plenty in terms of resources," says Douglas County Commissioner Doug Robertson. "Yet we're starving to death."

Standing inside the White Castle timber-sale area, Jerry Franklin lays out his latest vision of a forestry that can provide timber for struggling communities while also restoring the forest.

Along with his old-growth research, Franklin pioneered a "new forestry" that revolutionized federal logging practices in the '90s -- setting basic standards like leaving dead snags and legacy trees for habitat after a clearcut.

Franklin's more recent "ecological forestry" goes further. Larger patches of the best habitat -- 20 to 40 percent of the stand -- are left undisturbed while the rest is cleared to let smaller trees and shrubs fill in, creating "early seral" habitat that's high in biodiversity, with leafy plants for deer and elk, and flowers and fruit for birds and butterflies. Franklin is concerned that there's not enough of this habitat in the Northwest because clear-cuts on state and private land are managed more like plantations than forests: Almost everything is mowed down and sprayed with herbicide so that only replanted trees will grow -- an industrial model that shortcuts natural development.

The new method tries to mimic natural disturbances like wildfire and lets the forest recover more naturally. "It's an evolution in what we were thinking about under the Northwest Forest Plan," Franklin says. Back then, the focus was on saving the old growth; now, he says, it's the young forest that needs help, in part because there's been so little traditional logging on federal lands over the last decade.

Under the Northwest Forest Plan, clearcuts -- "regeneration harvests" in forester terms -- left more trees than an industrial cut but still provoked strong protests. In response, the BLM tried to meet timber targets by thinning crowded plantations to restore forests. But thinning provides less wood per acre and less return to agencies and county budgets. And some fear that the BLM will simply run out of forest to thin within the next couple decades. That's why Franklin wants to begin again with higher-volume, regeneration harvests.

"We need a dedicated land base for sustainable wood production on the federal lands, and this is part of it," Franklin says. The White Castle sale would produce 6.4 million board-feet of timber, slightly less than if it were cut under the normal standards of the Northwest Forest Plan, but 20 times more than if it were simply thinned. A recent study by Oregon Gov. John Kitzhaber's office shows that ecological forestry could satisfy the Northwest Forest Plan's target of 203 million board-feet for the O&C lands into the future, while continued thinning would fall short and eventually dry up.

But the White Castle sale has proven a difficult place to test this new vision. While Franklin and Johnson's strategy recommends cutting previously harvested stands, this one has never been logged. Columns of 108-year-old Douglas fir tower above, providing habitat near five spotted owl nests. In a few decades, the stand will begin to develop the complex structure of a true old-growth forest.

After the site was chosen, the Fish and Wildlife Service included all 256 acres as critical owl habitat but said that the logging project could proceed because it wouldn't cause excessive harm. Within 14 days of the sale's approval, environmentalists filed a protest to stop it, describing the "ecological forestry" label as "Orwellian."

"The White Castle project is a cynical attempt to pass off clear-cutting century-old trees as restoration," said Doug Heiken of Oregon Wild in a press release. "In reality, the true focus of this project is providing cheap timber to old-growth dependent logging mills at taxpayer expense."

Environmentalists fear that this project could clear the way for more of this sort of "active management" in old-forest owl habitat. They say mature forests on their way to developing into old growth should not be sacrificed especially when impacts to struggling spotted owls are unclear. In December, the BLM dismissed the protest, but the groups appealed.

"Orwellian doublespeak, my ass," Franklin retorts. He accuses his critics of distorting the terms of the debate. Under more traditional definitions, the project is neither a clear-cut nor is it in old growth, generally said to be at least 180 years old. Yet with all of the ancient stands essentially off the table, the new fight in Westside forests is over the 80- to 160-year-old future old-growth forests. "This is really where the battle is going to be fought out," Franklin says.

Meanwhile, industry groups say the pilots don't provide enough timber to satisfy the O&C lands' promise of logs to support the counties.

"Of all the issues I've worked on, this particular one has angered the widest spectrum of people -- just about everyone," Johnson says. He sees the pilot projects as a policy test for a new management paradigm that challenges the divide between forest reserves and timber harvest areas. That schism, he says, harkens all the way back to the split between John Muir's preservationist ideals and Gifford Pinchot's utilitarian forestry, which laid the foundation for federal land management.

The pilot harvest model demands that foresters abandon plantation forestry but requires environmentalists to accept that some types of logging -- beyond thinning -- can be ecologically beneficial. "We're asking people to look at that and not see forest destruction but see forest renewal -- and that's hard," says Johnson. "This is really fundamentally rethinking our philosophy of how we conserve and manage forests."

More than anything, the pilots demand something as endangered as the owl: New trust between old adversaries. Though the Northwest Forest Plan emphasized the need to adapt its policies for the future, the distrust between industry, agencies and environmentalists over the years has hampered new ideas -- and possible solutions.

There may yet be some middle ground: Another pilot near Medford was seen as a collaborative forestry success and sold last year without protests. Abbie Jossie, district manager for the Roseburg BLM, is encouraged by the collaborative process behind the pilots. "We all want to be out of the litigation bottleneck so that good things can happen on the landscape and economies can be restored," she says. "There's lots of space out there for agreement, I believe."

But last fall, loggers cut down several legacy trees in the Medford-area pilot that should have been preserved, leaving some locals feeling betrayed. The Coos Bay project was also protested for its spotted owl impacts, and plans to cut 110-year-old trees in another ecological forestry project called Rainbow Ridge near Eugene were dropped amid controversy.

Active management is generally more warmly received on the Eastside of the Cascades, where thinning can help fire-starved forests. But a proposal in Washington to erase the Northwest Forest Plan's old-growth reserve boundaries has spurred controversy at the northern end of spotted owl range (see sidebar).