Landmark timber deal stops Seattle sprawl

Some question logging as a tool to stop development

 

SNOQUALMIE, Wash. - A huge Douglas-fir log stands in the center of this tiny western Washington town, a testament to its deep connection to the timber industry. For over a century, local residents have harvested the thick, rain-soaked forests of Douglas-fir, hemlock, and cedar blanketing the surrounding hills to feed its local mills and economy.

But more recently, a different crop has sprung up around town. Houses. Just off the Interstate 90 corridor, Snoqualmie has become a bedroom community for Seattle, just 30 miles away. A golf course opened recently on a hill above town, and over 2,200 new homes are under construction in the area. By 2014, Snoqualmie's population is expected to increase almost ten-fold.

"We've had more than our fair share of development," says Snoqualmie Mayor Fuzzy Fletcher, noting that the community is struggling to hang on to its one remaining mill.

Surprisingly, Snoqualmie has found help from an unlikely ally. In January 2002, a group of Seattle conservation leaders, The Evergreen Forest Trust, announced that it had purchased the 104,000-acre Snoqualmie tree farm from the Weyerhaeuser Company. Backers say the $185 million deal will build a final wall against sprawl, preserving a major block in the region's working forest landscape.

"Our acquisition means it will continue to be a timber-producing forest, generating jobs and benefiting communities," says Gerry Johnson, a Seattle attorney and president of the newly formed Trust. "The project guarantees that this will remain as forestland forever."

The Trust plans to test a new idea: issuing bonds to raise money and selling timber to pay back the debt. If it works, the method could pave a new road for nonprofits across the country.

Forest in transition

Local conservationists have been worried that the Snoqualmie tree farm would turn into suburbia ever since Weyerhaeuser said it would consider selling several years ago.

"Being so close to an urban area, the cost of doing business up there just got too high," says Weyerhaeuser spokesman Frank Mendizabal. The forest is popular for recreation and has habitat for salmon, marbled murrelet and spotted owls, factors which complicate its management, he says.

The local conservationists, though, could not imagine where they might find the money to purchase the land. That changed in 1995, when Joe Euphrat of San-Francisco-based U.S. Forest Capital LLC approached local greens with the idea of using bonds to buy up and protect the property. A newly formed group, he proposed, would raise money by working with banks to sell tax-exempt bonds to investors, and then harvesting timber from the tree farm to pay off the debt over several years. While governments and hospitals have used the funding mechanism for some time, this would be the first time it would be used to protect land.

"The beauty was that we could pull off a big purchase like this without using public funds," says Gene Duvernoy, Director of the Cascade Land Conservancy. Along with Johnson and other politicians, conservation leaders and timber industry experts, Duvernoy helped set up the Evergreen Trust board in early 2000 to prepare for the tree farm purchase.

The deal now hinges on Internal Revenue Service approval, which Johnson says is likely within the next two months. Even after that, the Trust has a lot of work ahead of it. The nonprofit has hired The Campbell Group, a Portland, Ore.-based timber investment and management firm, to develop a management plan for the tree farm. Jim McCauley, spokesman for The Campbell Group, says that the plan must balance ecological goals while assuring harvest of enough timber to make bond payments.

"People should not assume that we will harvest any less aggressively (than Weyerhaeuser)," says Trust president Johnson. But Duvernoy says the trust's harvest will go far beyond state forest practice requirements for protecting sensitive land, and logging will be largely off-limits on 20 percent of the tree farm, particularly along streams, and around lakes and wetlands.

Once bonds are paid off, the Trust could stop logging and manage the tree farm for preser-vation. Or, Johnson says, it could continue harvesting to raise money for other land-saving deals in the region.

A healthy choice?

Some congressmen think bonds could hold the key to protecting private forests, and even agricultural and rangelands around the West. U.S. Forest Capital's Euphrat is working on similar financing deals to protect redwood forests in California. In Congress, Washington Sen. Patty Murray and Rep. Jennifer Dunn have also introduced legislation to amend the federal tax code to make bonding permanently available to nonprofits across the county, avoiding the need for case-by-case IRS approval.

Still, the idea of swapping houses for trees doesn't sit well with everyone. "I question whether we really have to make that choice," says Mary Chapman, director of the New Mexico-based Forest Stewards Guild, a nonprofit group dealing with forest ecology and management issues. The pressure of paying off bond debt, she says, could conflict with responsible forest management.

But Nancy Keith, executive director of the Mountains to Sound Greenway, says that in the face of imminent development, conservation groups must face hard economic realities.

"We have to play with the system if we're going to save these landscapes," Keith says. "Either we provide them some protection, or we watch them disappear forever."

Dave Wortman writes from Seattle, Washington.

YOU CAN CONTACT ...

  • Gerry Johnson, Evergreen Forest Trust, 206/686-2992;
  • Gene Duvernoy, Cascade Land Conservancy, 206/292-5907;
  • Frank Mendizabal, Weyerhaeuser Company, 253/924-3357.

Copyright © 2002 HCN and Dave Wortman

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