County contracts with UM for study on impact of national forest policies on local economy
The Ravalli County Commissioners have contracted for a study into the impact of Forest Service land management policies on the Ravalli County economy. The study, being conducted by the University of Montana Bureau of Business and Economic Research, began in April. It is expected to be completed by the end of July and cost $16,873.
Director Patrick Barkley states in his study proposal that Ravalli County, like many parts of western Montana, was once home to a wood products industry that was considerably larger than exists today. In the late 1990s, the county’s wood products facilities – encompassing mills, log home manufacturers, furniture and other products – employed more than 600 people and produced products with retail value of almost $90 million. Today’s activity, by any measure, is a fraction of that amount. In particular, the timber received by Ravalli County primary wood products facilities in 2014 was less than ten percent of the raw material processed by the facilities in 1988 or 1998.
Over this same interval of time, he notes, harvesting timber from national forests declined from a peak of almost 13 billion board feet (BF) in 1988 to roughly 2 billion BF in recent years. The cut volume in the Bitterroot National Forest, which accounts for 74 percent of the land in the county, mirrored that trend, falling from 46 million BF in 1985 to just over 3 million BF in 2017.
“This is only the most dramatic example of how management of public land, and in particular land managed by the U.S. Forest Service, has important impacts on economic activity in adjacent communities. The connection between public land management and everything from trail access to grazing rights is of critical importance to the livelihood of many other parts of the local economy.
“Enlightened land management policy would recognize that connection. The purpose of this research is to consider the impact of past management decisions of the U.S. Forest Service on the economy of Ravalli County. Specifically, the study investigates the impact of policies affecting timber harvest and timber availability on the wood products industry in the valley in particular, and on the economy of the county in general. While retrospective in nature, this research will help inform decisions on land management going forward that have local economic implications.”
According to Barkley, the plan for the project proceeds in three steps:
Step 1 is a descriptive analysis of the evolution of the wood products industry in Ravalli County. It will describe the trends in employment, production and timber harvests as well as the available data will allow and describe milestone events in both land management and company expansions and contractions that have shaped the industry that exists today. It will also describe the evolution of the overall economy, highlighting the significant growth in industries that have been spurred on by the amenities and resources from public lands.
Step 2 will focus more specifically on the wood products facilities in the county that were in existence in the late 1980s that could have remained viable under policies that would have kept their timber supply adequate. The objective in this step is to propose a list of county-based wood products facilities that could arguably have continued to produce and employ workers under policies that would have preserved their access to timber supply.
Step 3 will compare how the overall economy of Ravalli County would have evolved in this hypothetical “adequate timber availability” scenario for county producers to the actual historical path taken by the local economy. The difference between these two economic trajectories represents the economic impact of the reduction in timber availability produced by restrictive land management. Measures of the difference, in terms of jobs, income, population and sales, will be presented.
To produce the alternate, “adequate availability” scenario, BBER will make use of its economic model (REMI), which has been specifically designed and calibrated for the analysis. The scenario will take the assumptions of facility activity developed in step 2 of the project and introduce them into the economy as inputs to the economic model.
Costs of the project include wages, salaries and benefits for UM employees, the cost of leasing the economic impact model developed by Barkley, travel to Hamilton, and a 25% indirect cost levied on all externally funded projects by UM Research Administration.
At the March 15 meeting at which the commissioners decided to contract with UM, Commissioner Chris Hoffman asked if he was missing something here.
“I wonder if I’m even tracking what we are trying to accomplish,” he said.
“You probably aren’t,” said Commission Chairman Jeff Burrows, “because when I went up there it was different.” Burrows said that what he was seeking was a comparison of the recreation industry and the service industry to the wood products industry and see if the recreation industry has filled the gap in the decline of the timber industry.
“They said that they couldn’t do it and that the scope was too broad,” he said. “They kept driving it back on this analysis of if the timber industry was still here today.”
Commissioner Ray Hawk said he thought it was because that’s the kind of information they have in their database. He said he didn’t think they could get the kind of data needed to do what Burrows was asking, but then Hawk said that Burrows’ ideas were not really presented to Barkley at the initial meeting.
Hawk said that if this proposal is the information the commission wants, then he believed that the UM could do a good job, but added, “I don’t know if the information these guys propose to give us is worth the $16,873 or not.”
Commissioner Greg Chilcott said that, after what they had learned from agencies and Karen Budd-Falen (a controversial land use attorney who gave a public presentation in Hamilton last year at the request of State Rep. Theresa Manzella outlining ways in which counties can have more influence in state and federal land management decisions), “we have to have a plan that ups our standing in the coordination and collaboration, or whatever C-word you want to use, process with the Forest Service in the future planning process on the Bitterroot National Forest.” He said the county had a good plan but that “it could be much improved by getting specific data.”
But, he added, Barkley had indicated to him that they would be combing through existing data to create the plan.
“I’m curious how they get to $16,000 when they have already done the research,” said Chilcott. He said that if the data was in the public domain that they could possibly get a better deal from another consultant, like the one doing a plan for Idaho County.
Burrows said he had been told by Forest Service officials that in their Environmental Analysis under the NEPA process three different factors were considered and given equal weight, like a three-legged stool, the potential environmental, economic and social/cultural impacts.
He said the environmental issues were very emotional and difficult to address.
“Our best bet is to go after the economic and social issues and that’s our fight. I don’t know how much this will help us, but if we could show that we would have sawmills here if the loggers hadn’t been shut out of the forest, that would be important,” said Burrows.
Hoffman said that the timber harvest off private ground needed to be considered as well. He said most of the timber going to the Darby mill before it shut down was coming off private land.
“When we look at the Darby Lumber ground they did not manage it well,” said Chilcott. “They overdid it because that was their only resource of available timber.” He said he believes that because of the lack of available resources from public lands, it forced management approaches to the private land. Then, not having an infrastructure locally and the decline in timber prices made it unfeasible to do it here because they couldn’t get it off public lands.
“I’m in agreement,” said Hoffman. “I’m just saying it wasn’t just the Forest Service.” He too said that since the information was available in the public domain, he was having a hard time justifying the $16,000 price tag.
Burrows said that he believed a study conducted by the UM would have more credibility than one done by the consultant in Idaho County.
“If we get Pat Barkley from the University of Montana to do an analysis that shows the timber industry could have been viable if not for environmental policy, that flies directly in the face of what I’ve heard as far as timber management goes,” he said. He said what he heard was that the timber industry was dying anyway and being replaced by recreation.
“Well, that may not be true,” he said, “but I don’t know how else to show it than to get the data and sift through it. I know it seems like a lot of money.” He said he was thinking half that cost.
Chilcott said that the credibility factor was very important, and that by contracting with the UM, “it undercuts any suggestion we used a hired gun to produce data.”
Hawk said that it had to be something that could hold up in court.
“This is the reason Budd-Falen was here,” said Hawk. “She said it had to be something that would hold up in court because that’s maybe where you are going to wind up. But this is just one leg of the stool and I don’t know which is more important.”
Hoffman said that he would withdraw his statement and that a lesson on where we’ve been and where we might be could be important.
“I’m just concerned about the cost,” he said, “but we need a policy that they can’t ignore.”
Burrows said the study could be used like “another arrow in the quiver” that could be slipped into the Forest Service process.
“If we get that back from them in an independent study that’s a big, big part of our Resource Plan,” he said. He said if the study comes back saying that the timber industry was dying anyway, it would still be good to know.
“You’d be in the same spot, but then we shelve it and go on with our resource policy. It would be expensive,” he said, “but the knowledge would be worth it.”
Hoffman said, “If it’s a document you are throwing at them every time an issue comes up and they already know it is something they can ignore, they will ignore it. The idea is to develop a document that, when they see it coming, they go ‘Oh crap.’” If it’s done right, it’s going to stand up.”
“And it’s going to cost some money,” said Burrows.
“No problem with that,” said Hoffman. “I just don’t want to put it all into one leg and not make sure we’ve got the other two (legs) covered.”
A motion was made to approve the study proposal with UM for $16,873 with the money coming from an amended grant and from the general fund from the commissioner’s Special Projects allocation.
Hoffman reiterated his concerns about the money, stating that he hoped other money will be found for the other “legs of the stool.”
The motion was approved unanimously.
At a second meeting held on March 29 with the same agenda item, Burrows told the Commission that the county attorney’s office had reviewed the proposal and had no problems with it. He asked about the funding and Chilcott said that he was going to submit an amendment to DNRC to change the grant that was approved for education and outreach planned for addressing the Gold Butterfly timber sale to pay for a portion of the study.
A motion was made to approve the contract and Burrows said, “We already did.”