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Retention of High‐Valued Forest Lands at Risk
of Conversion to Non‐Forest Uses in
Washington State
|
Final Report
View or download the entire report (PDF)
Executive SummaryThe 2007 Washington State Legislature directed the University of Washington College of Forest Resources and its Northwest Environmental Forum to produce recommendations “for retaining the highest valued working forest lands at risk of conversion to non-forest uses.” Since 2004, Forum dialogues have brought together over 400 participants from 94 organizations, representing the full range of interests concerned about the future of Washington’s forests. Informed by in-depth research from the College, a remarkable consensus about the nature of the threats and the steps that must be taken to conserve our state’s working forests has emerged. The 2008 Forum defined “working forests” as “sustainably managed for commodity products as well as ecological and social values” and requiring a “permanent and un-fragmented land base.” The Forum made a series of major recommendations for the 2009 Legislature.
The description of all 2006-2008 Forum recommendations is in Appendix B. Ownership of the state’s 11.6 million acres of private forestland is split evenly among industrial and
non-industrial owners. These private lands provide critical fish and wildlife habitat, especially in
highly-productive lower elevation riparian areas. The Washington State Forestland Database,
developed by the University of Washington Rural Technology Initiative (RTI), analyzed data for
over 3 million properties including property valuation, forest soil productivity, forest cover, tax
status and other factors. Properties with a differential of greater than $2500/acre between forest
production value and the value of other uses were deemed at “high risk” of converting to non-forest The forest products industry is a significant economic driver for communities in all regions of the state. Forest and paper industries represent 11% of all manufacturing jobs and play a particularly important role in rural, timber-dependent communities. However, population pressures, changing forest ownership patterns and the desire for rural housing sites are fragmenting once continuous forests into smaller tracts that are economically and environmentally unsustainable. The potential risk of conversion is highest in the Puget Sound region. There and elsewhere, reductions in harvest levels due to conversion will translate into less supply for forest products mills. Washington mills will become less competitive over the next four decades and all sectors – mills, export, veneer and plywood and pulp manufacturers − will find their raw material supply significantly scarcer. Forest conversion will eliminate major opportunities to leverage forest carbon sequestration to address climate change and also negatively affect biodiversity, fisheries resources and open space. A successful state strategy to support the long-term future of working forests must (a) increase working forest values (by improving the product value of the timber resource and the value of nontimber resources) and (b) decrease alternative land use values by either compensating/incentivizing landowners for forgoing fragmentation or by containing urban sprawl to prevent fragmentation. This report presents mechanisms to achieve these outcomes in three displays: current Washington state programs, successful programs from other states, and proposed mechanisms from Forum participants. Until the state makes a commitment to an integrated strategy, it will be difficult for a significant number of landowners to willingly commit to a future in which their ability to continue managing their land for forestry appears to be jeopardized by regulatory uncertainty and real estate pressures. Ensuring a stable land base for forestry requires that a reasonable economic expectation from forest management can be met. A specific example is securing landowner support for Working Forest Conservation Easements, designed to ensure that the land remains as working forest for a stipulated time or in perpetuity. A significant number of family forest owners would consider such long-term easements, though fewer indicate a preference for permanent easements. Landowners more concerned about the development pressure on their forestland appear more willing to participate in forest conservation programs. The demand by forest landowners for large premiums in return for long or perpetual easements to their development rights should provide food for thought for policymakers and conservation organizations alike. Tradeoffs will have to be made between the number of forest landowners participating in forest protection programs and the length of such programs. Decisions regarding the desirability of wider program coverage at the expense of permanence will have to be made.
Table of ContentsExecutive Summary
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| Gordon Bradley, Ph.D. | Principal Investigator |
| Brian Boyle | Northwest Environmental Forum Leader |
| Luke Rogers | Forest Research Scientist/Data Base |
| Andrew Cooke | Forestry Research Consultant/GIS |
| Robert Rose | Research Consultant |
| Ellen Matheny | Report Production |
| Clara Burnett | Report Production |
| John Perez-Garcia, Ph.D. | Infrastructure Report |
| Sergey Rabotyagov, Ph.D. | Landowner Survey Report |
This research has been funded by the Washington State Legislature, through a pass-through grant to the Washington Department of Natural Resources for the College of Forest Resources. The Northwest Environmental Forum has been supported by its participant organizations and others, who are committed to the sustainability of Washington’s forests and devising market-based incentives that materially improve the ecological outcomes from working forest management.
The Family Forest Foundation and the Washington State Farm Forestry Association advocated for funds to develop a database of family forestlands in Washington State, resulting in a 2006 federal budget allocation of $500,000 for a "private landowner database," culminating in a USDA Forest Service contract with the Rural Technology Initiative to create the Washington State Forestland Database. This project could not have been completed without their combined efforts.
We thank Matthew Donegan of Forest Capital Partners for his “Four-part Framework for Preserving Working Forests,” and allowing us to reproduce his paper in Appendix G. The image on the front page is by permission of Getty Images, John Humble, photographer.
Forum Sponsors
| Audubon Washington Cascade Hardwood LLC Cascade Land Conservancy Conservation Northwest Ecotrust Family Forest Foundation Forest Capital Partners, LLC Forest Legacy Investments Green Crow Management Services Green Diamond Resource Company Hancock Timber Resource Group Henry M. Jackson Foundation Kongsgaard-Goldman Foundation Lanoga Corporation Longview Fibre Company Merrill & Ring, Inc. Murray Pacific Corporation Olympic Resource Management LLC Plum Creek Timber Company, Inc. Port Blakely Tree Farms |
Preston Gates & Ellis LLP Seattle-Northwest Securities Corporation The Bullitt Foundation The Conservation Fund The Nature Conservancy The Pacific Forest Trust The Trust For Public Land Trillium Corporation Washington Alder Washington Department of Fish & Wildlife Washington Farm Forestry Association Washington Forest Law Center Washington Forest Protection Association Washington State Conservation Commission Washington State Department of Natural Resources Weyerhaeuser Family Foundation Weyerhaeuser Company Weyerhaeuser Company Foundation |
Project Background
Northwest Environmental Forum Beginnings and Sustainable Forest Communities
The Northwest Environmental Forum was created at the College of Forest Resources (CFR) at the University of Washington in 2003 to apply CFR’s environment-related sciences to help resource managers and public policy makers confront resource conflicts through a facts-based dialogue and establish new ways to sustain natural resource systems with market-related initiatives. An“educational observatory” is also a Forum objective, such that faculty and students can add value and learn from the dialogue. The Forum creates a working space to move outside past disagreements and cultural perceptions and weigh complex resource management expectations in terms of the pressures imposed by rapid population expansion.
Forum Attendees and Sponsors
In the five years (2004-08) that the Forum has met, over 400 participants from 94 organizations, besides the University of Washington, have engaged in a dialogue and made recommendations about the issues surrounding the losses of working forests to urbanization. The Forum has been funded to date by the philanthropy of 44 sponsor organizations, including conservation, forestry, federal and state agencies, and foundations. Forum attendees have included a diverse group of environmental advocacy, land trust and conservation organizations, Indian tribes, forest industry large and small, academic, foundation, and government – local, state and federal. Forum Proceedings, recommendations and sponsors (2004-2008) can be found at: www.nwenvironmentalforum.org. Major Findings and Proposals for 2009 Legislative Action from the 2008 Forum can be found in Appendix B. Appendix C lists the organizations and people who attended one or more Forums.
Legislative 2005 Proviso
Following the initial Forum of 2004, “Saving Washington’s Working Forest Land Base,” the 2005 Washington State Legislature responded by appropriating $1.0 million for the College of Forest Resources to research timber supply, industry competitiveness, and the impacts of forest land losses to development pressures. College researchers reported study findings The Future of Washington’s Forests and Forest Industries, to the Forum in October and November 2006, which prompted new Forum recommendations.
Legislative 2007 Proviso
The 2007 Legislature asked for: “recommendations from the College’s Northwest Environmental Forum for retaining the highest valued working forest lands at risk of conversion to non-forest uses. These recommendations should include an examination of means to enhance biodiversity through strategic retention of certain lands, as well as economic incentives for landowners to retain lands as working forests and provide ecosystem services. The recommendations shall consider the health and value of the forest lands, the rate of loss of working forest lands in the area, the risk to timber processing infrastructure from continued loss of working forest land sand the multiple benefits derived from retaining working forestlands. The recommendations shall prioritize forest lands in the Cascade foothills, which include the area generally encompassing the non-urbanized lands within the Cascade mountain range and drainages lying between three hundred and three thousand feet above mean sea level and located within Whatcom, Skagit, Snohomish, King, Pierce, Thurston and Lewis counties.”
What Defines a Working Forest?
The 2008 Forum defined “working forests” as “sustainably managed for commodity products as well as ecological and social values” and requiring a “permanent and un-fragmented land base.”
Washington’s Forests and Forest Industries’ Future
Washington State has large industrial and non-industrial land holdings and also has state forests managed to produce income for schools and universities. The forest products industry is a significant economic driver for communities in all regions of the state. Forests, even logged periodically, provide protection for riparian ecosystems far more than when the forest is gone, yet the forces of growth are fragmenting the forests into unsustainable economic and environmental units.The economics of forest ownership are changing as urban expansion has encroached on forest lands. These forces, in turn, stimulate additional forest conversion for scattered rural housing. Reduced timber supply limits sawmill supply and expansion, transportation distances for saw-logs become uneconomic, and overcrowded roads make haulage costs prohibitive. Forest land is increasingly a financial, rather than an industrial asset, as old-line companies have monetized their forest assets and been replaced by institutional investor-managers, or reorganized into real estate investment trusts. The landscape of forest ownership is changing rapidly, and the income expectations of owners are often met by converting land to take advantage of rising land development values. Even non-profit landowners have revenue needs.
The study The Future of Washington’s Forests and Forest Industries (2007), conducted for the Legislature by the College of Forest Resources, shows that national forests in Washington produce only about 10 percent of the timber that was harvested during their heydays in the 1970’s, and highlyproductive industrial, state, and small private, non-industrial forest lands have filled the gap. Nonindustrial and family-owned woodlots, with 215,000 small landowners and about 25 percent of the forest base of Washington, are typically at lower elevations, closer to cities and under the greatest pressure to develop. See Table 1 for ownership by landowner type. Under current rules, these ownerships typically have the highest per acre regulatory costs to harvest their timber. It is actually easier under some local rules to build a house near a stream in Washington State than it is to log and replant a forest near the same stream.
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| Figure 1. Only 15 feet of forested buffer is maintained around the stream, and houses are built within 30 feet of the stream edge. Source: FWF 2007, DP7-7 |
Had this parcel been used for forestry, a minimum of 50-foot no harvest buffer would have been required, with additional buffering out to a total of 90-200 feet depending on stream type and site class.
These lands are also important for wildlife habitat and fish regeneration, especially in highlyproductive lowland riparian areas. We cannot easily quantify biodiversity or other ecological factors of the land since markets don’t exist for ecological services, yet they have value and their loss is dramatic and permanent when the forests are converted to shopping malls. The importance of industrial, non-industrial, and family ownerships of these woodlands in terms of state gross business income, family income, total jobs, and contribution to local and national economies were quantified in the College of Forest Resources’ Future of Washington’s Forests and Forest Industries research commissioned as result of the first Forum.
Table 1. Washington State Forestland Parcel Acres by Owner Type and County Washington State Forestland Parcel Acres by Owner Type and County.
Table 1. Washington State Forestland Parcel Acres by Owner Type and County |
|||||
County |
Industrial |
SFLO |
Tribal Industrial |
Tribal SFLO |
County Total |
| Adams | 3,759 | 28,004 | 31,763 | ||
| Asotin | 39,794 | 134,658 | 994 | 175,445 | |
| Benton | 1,284 | 9,383 | 10,667 | ||
| Chelan | 60,260 | 127,220 | 187,480 | ||
| Clallam | 261,485 | 81,337 | 3,896 | 1,084 | 347,803 |
| Clark | 42,016 | 128,761 | 170,777 | ||
| Cowlitz | 418,491 | 124,499 | 16 | 543,006 | |
| Douglas | 11,698 | 116,208 | 296 | 128,203 | |
| Ferry | 126,367 | 183,298 | 56,628 | 5,272 | 371,564 |
| Franklin | 2,338 | 30,060 | 32,397 | ||
| Garfield | 161,413 | 161,413 | |||
| Grant | 3,393 | 6,867 | 10,260 | ||
| Grays Har | 555,518 | 134,700 | 41,382 | 15,646 | 747,246 |
| Island | 299 | 76,239 | 76,537 | ||
| Jefferson | 141,068 | 62,378 | 96 | 203,542 | |
| King | 237,371 | 171,150 | 1,823 | 410,344 | |
| Kitsap | 24,376 | 116,703 | 10,429 | 1,279 | 152,788 |
| Kittitas | 181,472 | 104,607 | 30 | 286,109 | |
| Klickitat | 225,848 | 273,961 | 75,766 | 156 | 575,730 |
| Lewis | 604,033 | 248,426 | 198 | 852,658 | |
| Lincoln | 14,889 | 216,230 | 72 | 231,190 | |
| Mason | 229,339 | 101,326 | 3,126 | 333,790 | |
| Okanogan | 33,468 | 439,367 | 29,014 | 1,857 | 503,705 |
| Pacific | 381,005 | 70,023 | 137 | 451,166 | |
| Pend Orei | 86,020 | 110,447 | 1,004 | 197,471 | |
| Pierce | 235,462 | 180,364 | 312 | 416,139 | |
| San Juan | 76,378 | 76,378 | |||
| Skagit | 191,991 | 118,523 | 1,522 | 312,036 | |
| Skamania | 81,905 | 33,497 | 115,402 | ||
| Snohomish | 92,235 | 216,846 | 10,219 | 319,300 | |
| Spokane | 39,021 | 527,052 | 566,073 | ||
| Stevens | 303,898 | 623,554 | 2,891 | 930,344 | |
| Thurston | 94,966 | 163,911 | 1,196 | 260,073 | |
| Wahkiakum | 91,195 | 28,640 | 119,835 | ||
| Walla Wal | 2,991 | 79,567 | 82,558 | ||
| Whatcom | 89,203 | 138,678 | 3,709 | 231,590 | |
| Whitman | 199,304 | 199,304 | |||
| Yakima | 37,861 | 58,084 | 697,995 | 2,944 | 796,884 |
| State Total | 4,946,321 | 5,701,661 | 915,111 | 55,878 | 11,618,971 |
Economic Contribution – Local Jobs and Exports from Washington’s Forests
The Economic Contribution section of the Future report shows that the forestry and wood products manufacturing sectors have played an increasingly important role in the economy of Washington State since 2001. The sector provided over 45,000 jobs in 2005, generated approximately $16 billion in gross business revenue, and paid out over $2 billion in wages and over $100 million in tax receipts. As a result, the forestry and related wood products sector of the state economy employed 1.43% of the workers in the private sector in Washington, accounted for 1.8% of the total wages paid within the private sector, and generated 3.2% of the gross business income of the private sector. There are estimated to be 7.7 direct jobs and 32.3 indirect jobs linked to each million board feet of timber harvest in Washington.
Employment in the forest and paper industries represents 11% of all manufacturing jobs in the state, suggesting that the forest products industry plays an important role within the diversified economy of the state. This is of particular relevance since many of these jobs are located in rural, timber dependent communities where family wage jobs are difficult to come by. For example, the 2005 employment and wage data show that jobs in the lumber manufacturing and paper manufacturing industries provide an annual average wage of $45,703 and $60,421, respectively. Indeed, even the logging industry provides an average annual wage of $40, 208.
The exporting of wood products from private lands is also an important contributor to the State’s economy, particularly in the current economic downturn. Despite the fact that softwood lumber production in the state dropped by 19.8% between 2007 and 2008, exports of wood products from Washington actually increased by 8.6% from $1.28 to $1.39 billion. This represents the only bright spot within an otherwise down economy. Between 2007 and 2008, Washington saw its share of total US wood product exports increase from 19.6% to 19.9%.
Why Protecting Working Forest Ownership is Important Now
The challenge of how to protect Washington’s private and public forests for the next century is remarkably similar to the situation of 75 years ago, when in the midst of the Great Depression, a 1934 report from the University of Washington identified the key problem then facing the state and the future of its forest industries as: the rapid loss of productive forest land from timber companies who had “cut and run” and subsequently were unwilling to pay county taxes or re-forest the land. The report said: “We must look to the perpetuation of the forest as the forest land problem is rapidly becoming one of the most aggravating of the State.” The report called for “adjustments in the entire tax system to conserve all the social values for society of large forested areas.” The legislature responded by passing the Forest Board statutes providing for transfer of these taxdelinquent properties to the state for long-term forest management. These 626,000 acres of highly productive lands now serve as critical “anchor forests” in many of our urbanized and urbanizing counties. This concept of anchor forests will be examined further in this report.
Today we face a problem of similar magnitude, but now it is characterized by the fragmentation of the state’s most productive forests from real estate pressures, changes in forest company ownerships, and lack of incentives for forest land owners to manage their lands for ecological, along with timber values.
A Forest Land Parcel Database is Critical to Understand Consequences of Shifting Land Uses
The 2007 Forum supported a newly-created Forest Land Parcel Database, created by the College of Forest Resources with funds granted to the Family Forest Foundation and Washington Farm Forestry Association. Leading up to the 2008 Forum, this data structure enabled the production of a series of “risk of conversion and opportunities for conservation" maps, which include critical areas, forest economic values, real estate values, environmental and wildlife values, and the potential impacts upon forest products processing infrastructure. This report includes a description of the methodology of these analyses and includes critical maps.
Methodology for the Retention Report ‐ The Washington State Forestland Database – New and Comprehensive Spatial Analysis
Beginning with the passage of Washington State House Bill 2091, otherwise known as the Salmon Recovery Act (1998), the State has had an interest in quantifying the numbers, acres, and other characteristics of small forest landowners (SFLO) and their lands. The Washington State Forestland Database was developed to provide a comprehensive platform for understanding the spatial characteristics of productive private and public forestlands in the state, including family forests. The Database is an ArcGIS 9.2 Geodatabase and designed for use in Microsoft Access or any ESRI ArcGIS product. Appendix E contains a full explanation of the history and the methodology of the Database.
The Washington State Forestland Database combines land ownership, land use and assessment information with physical characteristics of the land to develop economic, social and environmental metrics about the forest land base. The spatially-explicit information in the database allows for analysis at the watershed, county and state level. This high-resolution dataset can produce maps, statistics and models at multiple scales. Over time it will become a comprehensive platform for understanding how forest land ownership and land use are changing, thereby enabling new science and research to inform public policy analysis, debate and action.
Three primary products were developed: the Washington State Forestland Database, statistics on the numbers and acres of forestland parcels and maps of the distribution and extent of private forestlands. Statistics derived from the Database reveal that 215 thousand small forest landowners own 5.7 million acres of forestland, half of the 11.6 million acres of private forestland in the state. Over 55 thousand of those small forest landowners have ownerships greater than 20 acres. The maps of the distribution of forestlands in the State of Washington show that small forest landowner properties, often adjacent to suburban and exurban lands, provide a critical buffer between industrial forestlands and residential areas.
To map and quantify the location and features of forestlands, parcel data and assessor’s attributes from the state’s 39 counties were collected and normalized into a common statewide format. In counties where no GIS parcel data exist, GIS “pseudo parcels” were developed from assessor’s legal descriptions. The three million individual parcels in the normalized database were then compared to forestland cover maps developed from Landsat satellite imagery as part of the National Land Cover Dataset. In addition to the landcover assessments, assessor’s tax rolls were used to identify forested land uses as well as participation in forestland tax programs. Forest land parcels as small as 1 acre were included in the database.
Owner names, categories and style of forest management were classified into five “owner type categories”: government, corporate, tribal, conservation and other private. Using owner type and number of acres, parcels were classified into management types: industrial or small forest land owner. By use of the Landscape Management System, the management regimes and the physical characteristics of the property, including site index, forest type and regulatory buffers, were modeled to develop a financial profile for each forest parcel. In addition, multiple physical and political characteristics were computed for each parcel such as distance to development, proximity to roads, distance from a designated Urban Growth Area and contiguous ownership area.
Consequences of Forest Land Conversion on Watersheds and Adjoining Anchor Forests
The projected risk of forest conversion to non-forest use was determined for timberlands located in
the State using the Washington State Forestland Database developed by the University of
Washington College of Forest Resources (Rogers and Cooke 2009). The conversion threat was
determined by calculating the difference between per acre market value and per acre forest value for
each parcel. Any property with an assessed value higher than its value for forestry (SEV) was
deemed to have “positive risk.” Forest properties with a current value of $2,500 per acre or more
than their forest production value were considered at “high risk of conversion.” DNR lands and
parcels enrolled in the Designated Forest Land (DFL) program were not included in the “at risk”
analysis.
The Designated Forest Land Program, under RCW 84.33, provides substantial reductions in annual property taxation rates, in exchange for a stumpage value tax at the time of timber harvest. Forest lands in the DFL current use taxation program were assumed to have zero conversion risk. Market value appraisals for DFL lands are not available from most county assessors and could not be inferred from adjacent lands.
Many counties are required to develop comprehensive plans to manage urban growth, critical areas and resource lands of “long term commercial significance” under RCW 36.70A. These plans and the resulting land use zoning restrictions are intended to discourage residential and commercial development within agricultural and forest lands of long-term commercial significance. The effect of land use planning on forestland conversion was recognized as an important factor in the analysis of conversion risk, however GIS-based representations of these plans were not available statewide and could not be incorporated into the risk assessment. Future research is needed to accurately quantify the risk of conversion in designated forest resource zones.
Detailed maps of “High Conversion Risk, High Value Private Forestland Near Anchor Forests in Washington” can be found in Appendix A. The State is broken out as nine sub-regions to allow a more fine-grained view of the working forest land base and its relationship to Department of Natural Resources-managed forests and Designated Forest Lands (DFL).
The following maps display the results of three analyses quantifying the resource impacts and conservation opportunities associated with forestland conversion. Summarizing private forestlands at high-risk of conversion as a proportion of the non-Designated Forest Land (non-DFL) base, by watershed, reveals where private forestlands are scarce, have a high real estate value, or both.
Figure 2 shows that in a substantial number of Puget Sound’s watersheds 80% or more of the remaining private forestlands not enrolled in the Designated Forestland Program have a high risk of conversion. Making the assumption that all forest resource lands which are both (a) not enrolled in the DFL program and (b) have a positive conversion risk, will convert from working forest to other land uses, a map of the amount of forestland conversion was created.
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| Figure 2. Watersheds where Private Forests are at the Greatest Risk of Conversion |
Table 2. Risk of Forest Conversion by Water Resource Inventory Area (WRIA)
Figure 3 shows what percent of Washington’s watersheds could be impacted by forestland conversion through the year 2050 if the depressed timber economy and high real estate values continue to drive conversion trends. Considering the conversion risk, productivity and proximity to relatively stable State and private DFL lands, an analysis of high-value forestlands at risk of conversion was undertaken to produce a map of possible areas for encouraging and focusing longterm forestry.
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| Figure 3. Projected Percentage of Watersheds Converted from Private Forest to Non-Forest Uses by 2050 |
Figure 4 shows high value forestlands at risk of conversion that are located near “anchor forests” – areas where State and private forestlands dominate the landscape and function as a more-or-less intact working forest land base.
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| Figure 4. High Conversion Risk, High Value Private Forestland Near Anchor Forests in Washington |
Anchor Forests
Anchor forests are landscape-scale areas in which managed forests are the dominant land use. For the purpose of this report, “anchor forests” are contiguous areas of working forest land managed by the Department of Natural Resources, private forest lands in Designated Forest Land tax status and USDA Forest Service ownership. There has been no official or unofficial designation of these areas. For evaluation purposes, these areas were considered to have a reasonable likelihood of stability for meeting the multiple commodity and non-commodity demands from the state’s forests. High value forest lands at risk of conversion within one mile of these contiguous areas were judged to be highly strategic because the impact of fragmentation or parcelization of these lands would affect the stability of larger integrated blocks of forest land.
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Forest land lost to conversion threatens harvest levels, wood supply and all aspects of the forest industry
A University of Washington study (Perez-Garcia, et al. 2009) analyzed the economic viability of forest products facilities in light of a large potential conversion of productive, privately- or Triballyowned forestlands. The projected risk of forest conversion to non-forest use was determined for timberlands located in western Washington using the Washington State Forestland Database.
The conversion risk attribute was applied to three ownership classes: small forest landowners, industrial landowners, and tribal landowners. An existing model for westside forests was used, with some modifications to allow for a changing land base. Modeling eastside forests is much more complex and the budget did not allow development of eastside scenario model. While qualitative statements can be made based on the risk of eastside conversion, measures of their potential effects are needed.
The results suggest significant potential harvest reductions by 2080 and a continued decline in the potential harvest level. Harvest level reduction translates into less supply and rising timber prices.
The following tables present the total forest acres, losses in the past 18 years, at-risk acres and percent at-risk acres within western Washington counties and their five timbersheds: North Coast (Clallam and Jefferson), North Puget Sound (Island, King, San Juan, Skagit, Snohomish and Whatcom), South Coast (Grays Harbor and Pacific), South Puget Sound (Kitsap, Mason, Pierce, and Thurston) and Southwest (Clark, Cowlitz, Lewis, Skamania and Wahkiakum).
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| 1From University of Washington Forest Land Parcel Data Base 2From Adams et al., 1992 (excludes DNR and other public lands) 3Based on 19 years difference (1990 to 2008) |
The risk of conversion is highest in the North and South Puget Sound timbersheds, where an estimated 250,000 private forest acres have been converted to date, and nearly 1 out of 3 acres have a positive associated conversion risk. Approximately 972,000 acres in western Washington have a higher market value per-acre than forest value per-acre. Maps showing the loss of forest land for sustainable forest production in the five Western Washington Timbersheds over the course of four decades (until 2050) can be found in Appendix A.
Figure 5 shows the potential harvest levels that could occur for timber between the ages of 40 to 65 years using a 1990 harvest baseline, a 2008 harvest baseline and a likely to convert scenario based on forest vs. HBU value differences.
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| Figure 5. Harvest levels in million board feet (MMBF) |
The effect of a lower number of forested acres is reduced harvest levels in all timbersheds.
Figure 6 shows the impact by timbershed of the affected conversion of forests over the next century. If current trends continue, in 60 years, South Puget Sound will produce no forest products.
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| Figure 6. Harvest levels in million board feet (MMBF) by timbershed |
Sawmill raw material input may be reduced by more than 1,000 Million Board Feet (MMBF) by 2080, a 43% decline.
The forest industry consumed nearly 2,484 MMBF of logs from private sources according to the 2006 Washington Mill Survey (Smith et al. 2008; Table 8a). About 62% of these logs went to lumber mills. The majority of the remaining volume went to exporting and veneer and plywood facilities. By 2080 the supply of logs could potentially fall to 1,402 MMBF, a loss of over a billion board feet. (This would represent over 90% of the volume of logs consumed by the sawmilling sector alone in 2006.) However, not all logs go to lumber production since some timber goes to veneer and plywood mills, as well as for export and other forest enterprises.
Sawmill competitiveness in regions with high-risk forestlands will diminish
Eight sawmills operated in the South Puget Sound timbershed in 2006 (Smith et al. 2008). All but two have a capacity to produce 0.120 MMBF. Two mills have eight-hour shift capacities that produce more than 0.500 MMBF. The loss of potential timber harvest levels within this timbershed by 2060 will impact the competitiveness of these sawmills.
Small mills will not be able to compete
While larger sawmills could compete with other sectors consuming logs, a third of the mills in the state are smaller in size and could find it more difficult to compete. Rural, timber-dependent communities will be severely affected by the projected reductions. If wood processing facilities that purchase logs from forest thinning operations are closed, this will undermine the ability of forest managers to actively manage their forests, and potentially result in forest health decline.
Exports of Washington logs will decline, along with sawmills
Exports of Washington logs reached 286 MMBF in 2006 (Smith et al. 2008; Table 57). This volume represents 76% of the loss in potential timber harvest levels in 2055. Should sawmills successfully compete with exporting enterprises for this volume, sawmills will fall short in meeting their current consumptive needs.
Veneer and Plywood mills will have insufficient supply
Veneer and plywood mills consumed another 234 MMBF of logs (Smith et al. 2008; Table 35) in 2006 although this number does not distinguish the log volumes that originated from Washington private lands. Similar in volume to Washington logs exported, this volume can help meet existing consumptive needs by sawmills, but at higher cost.
12 pulp mills statewide will experience significantly- reduced raw material supply
Sawmills, and veneer and plywood mills are sources of chips and wood residuals for other industries, primarily pulp mills. In 2006, 3.3 million dry tons of chips and wood residuals were produced in western Washington (Smith et al. 2008; Table 26). The twelve pulp mills statewide consumed a total of 4.2 million tons of mill residues in 2006 (Smith et al. 2008; Table 44). A 43% reduction in timber consumed by lumber and plywood mills by 2080 will significantly impact this raw material supply to pulp mills.
Incentives are Needed for Retaining Working Forests
The 2007 Washington legislative budget language directed the Forum to examine “economic incentives for landowners to retain lands as working forests for the purposes of providing ecosystem services.” Since its first meeting in 2004, the Forum has focused on this question and has supported various reports, presentations and evaluations of existing and potential opportunities to“incentivize” the retention of working forest lands. Representatives from major forestland owners and processors, tribal, state and local governments and conservation organizations broadly support mechanisms to address the core issues of forest fragmentation and land owner commitment to longterm stewardship. The Forum process of review, consideration, debate and agreement strongly signals the need for the legislature to bring a more comprehensive, coordinated and focused set of programs to bear on the issues of forest fragmentation and loss. Much of the necessary vetting of feasible programs is incorporated in the materials below. The “end-state” question is: Can Washington make the necessary policy and financial commitments to ensure that forest values compare favorably with alternative land uses?
Comparing Incentives to Retain and Mitigate Forest Value Losses in Washington and other states
Three investigations – regarding Current Washington Incentive Programs for forest landowners, a compilation of recent innovative efforts from Other States, and some Proposed Programs, that are the recommendations of 2006-07-08 Forums - are presented below in Tables 6, 7, and 8, with web links provided for each incentive program.
The report “Recent Efforts by States to Incentivize Working Forests” (Sarah Murray, 2005) is found at http://www.nwenvironmentalforum.org/ForestForum/topicpapers/tp13.pdf. In 2008, the Forum received an update to Murray’s work by Jana Dilley: “Working Forests Incentive Programs and Legislation for Private Forest Lands in United States” as well as an updated report on Washington’s programs: “Washington State Working Forest Incentive Programs” http ://www.nwenvironmentalforum.org/documents/ForestIncentivePrograms.pdf
The Cascade Land Conservancy and College of Forest Resources carried out an extensive review of ‘Forest Land Conversion in Washington State (Study 4, FWF and FI Report 2007) and reported on “Current incentive programs to maintain forest land in Washington” ((Section 3) as well as investigating “Future incentive programs to maintain forest land in Washington.” (Section 6) http://www.ruraltech.org/projects/fwaf/final_report/pdfs/05_Study4_LandConv.pdf
Tables 6, 7, and 8 are organized according to a “Four-part Framework for Preserving Working Forests” presented by Matthew Donegan (Forest Capital Partners, LLC) to the Oregon Task Force on Land Use Planning (September 2007).
A Four‐Way Framework for Preserving Working Forests: Increasing Working Forest Values (Timber and non‐Timber), or Mitigating Alternative Land Use Values (Compensation or Regulation)
The core principle of this framework is to address the fundamental problem that forest lands are converted to other uses because the difference in value between their use as forest land and their value for other uses becomes large enough to cause an owner with rational economic motives to divest of the land or (develop it) for more economically valuable uses. To understand how to best bridge this value gap, Matthew Donegan proposes to view all policies and programs for forest retention through two complementary lenses: 1) does the policy or program Increase Working Forest Values (by improving the value of the timber resource and the value of non-timber resources such as ecosystem services); and 2) does it Decrease or Off-set Alternative Land Use Value by either compensating/incentivizing landowners for forgoing fragmentation or by regulating/restricting landowners to prevent fragmentation?
The full text of Donegan’s presentation is in Appendix G.
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Figure 7. A Four-Part Framework for Preserving Working Forests Source: Preserving Oregon’s Working Forests: A Landowner’sPerspective on Sustainability, Matthew W. Donegan, Forest Capital Partners LLC (Portland, Oregon) |
Table 6. Currently Available Mitigation and Incentive Programs in Washington
*This table will open in a new browser window and is viewable as a photo album (4 images).
Table 7. Other States' Incentive Programs
*This table will open in a new browser window and is viewable as a photo album (9 images).
Table 8. Incentives Proposed or Under Consideration (from the Northwest Environmental Forum)
*This table will open in a new browser window and is viewable as a photo album (8 images).
What the Table 6 and 7 matrices of current Washington and other states’ programs don’t show about program success and why new efforts such as the Incentives Proposed in Table 8 should be considered.
Mechanisms such as Washington’s Fish Passage program or the Leave Tree Tax credit were designed by the egislature to address significant timber values lost to landowners because of previous regulatory changes. As with many such programs, these efforts mitigate only a small amount of the actual impact on a landowner’s asset values. Despite the virtues of many incentive efforts, the economics of land conversion, coupled with landowner frustration with regulatory requirements, creates a powerful dynamic favoring disposal of high-value forest land for other uses.
Programs designed specifically as incentives vary from marginal (though important) programs such as site specific assistance for tree planting or stand improvement to core public policies such as Minnesota’s Forests For the Future Program, which is an integrated suite of incentives and easement purchases. Habitat and water quality improvement programs appeal to the stewardship motivation of many small forest landowners, and the attraction of these programs can be judged by the fact that many are over-subscribed.
The clearest way to close the gap between forestry values and “highest and best use” (HBU) is to improve timber resource values and simultaneously reduce the opportunity for large forest fragmentation. A fundamental requirement of a successful state policy is that it integrates regulatory and tax programs into a stable and predictable framework to make long-term forestry investments attractive. Such a framework would also include incentives for production mills and bio-fuel investment and support for developing markets for the state’s wood products.
Neutralizing or off-setting alternative land use options is as critical as providing viable incentives. Transfer or purchase of development rights can separate the development values normally derived from landscape fragmentation. This requires a serious investment of public and private funds and energy coupled with a market-based transactional framework that supports the efforts. Washington has recently begun efforts for regional TDRs. Utah and Minnesota have effectively used purchase of development rights programs to begin to stabilize their states’ land bases for sustainable forestry. The state of Virginia provides the option for associations of local landowners to become a “forestal district” (sic) with reduced tax benefits and higher levels of protection against competing land uses. Although the regulatory approach of limiting land division and parcelization of forest land has been partially addressed by Washington’s Growth Management Act (GMA), the effectiveness of this law and its implications for long term forest retention has not been evaluated. The Forum recommended that an effort such as that in Minnesota should be initiated by the Washington Legislature.
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