[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



 
                         SECURE RURAL SCHOOLS

                          REAUTHORIZATION AND

                           FOREST MANAGEMENT

                         OPTIONS FOR A VIABLE

                        COUNTY PAYMENTS PROGRAM

=======================================================================

                           OVERSIGHT HEARING

                               before the

                SUBCOMMITTEE ON NATIONAL PARKS, FORESTS

                            AND PUBLIC LANDS

                                 of the

                     COMMITTEE ON NATURAL RESOURCES

                     U.S. HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                         Thursday, July 14 2011

                               __________

                           Serial No. 112-50

                               __________

       Printed for the use of the Committee on Natural Resources



  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html
                                   or
          Committee address: http://naturalresources.house.gov




                  U.S. GOVERNMENT PRINTING OFFICE
67-404                    WASHINGTON : 2012
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



                     COMMITTEE ON NATURAL RESOURCES

                       DOC HASTINGS, WA, Chairman
             EDWARD J. MARKEY, MA, Ranking Democrat Member

Don Young, AK                        Dale E. Kildee, MI
John J. Duncan, Jr., TN              Peter A. DeFazio, OR
Louie Gohmert, TX                    Eni F.H. Faleomavaega, AS
Rob Bishop, UT                       Frank Pallone, Jr., NJ
Doug Lamborn, CO                     Grace F. Napolitano, CA
Robert J. Wittman, VA                Rush D. Holt, NJ
Paul C. Broun, GA                    Raul M. Grijalva, AZ
John Fleming, LA                     Madeleine Z. Bordallo, GU
Mike Coffman, CO                     Jim Costa, CA
Tom McClintock, CA                   Dan Boren, OK
Glenn Thompson, PA                   Gregorio Kilili Camacho Sablan, 
Jeff Denham, CA                          CNMI
Dan Benishek, MI                     Martin Heinrich, NM
David Rivera, FL                     Ben Ray Lujan, NM
Jeff Duncan, SC                      John P. Sarbanes, MD
Scott R. Tipton, CO                  Betty Sutton, OH
Paul A. Gosar, AZ                    Niki Tsongas, MA
Raul R. Labrador, ID                 Pedro R. Pierluisi, PR
Kristi L. Noem, SD                   John Garamendi, CA
Steve Southerland II, FL             Colleen W. Hanabusa, HI
Bill Flores, TX                      Vacancy
Andy Harris, MD
Jeffrey M. Landry, LA
Charles J. ``Chuck'' Fleischmann, 
    TN
Jon Runyan, NJ
Bill Johnson, OH

                       Todd Young, Chief of Staff
                      Lisa Pittman, Chief Counsel
                Jeffrey Duncan, Democrat Staff Director
                 David Watkins, Democrat Chief Counsel
                                 ------                                

        SUBCOMMITTEE ON NATIONAL PARKS, FORESTS AND PUBLIC LANDS

                        ROB BISHOP, UT, Chairman
             RAUL M. GRIJALVA, AZ, Ranking Democrat Member

Don Young, AK                        Dale E. Kildee, MI
John J. Duncan, Jr., TN              Peter A. DeFazio, OR
Doug Lamborn, CO                     Rush D. Holt, NJ
Paul C. Broun, GA                    Martin Heinrich, NM
Mike Coffman, CO                     John P. Sarbanes, MD
Tom McClintock, CA                   Betty Sutton, OH
David Rivera, FL                     Niki Tsongas, MA
Scott R. Tipton, CO                  John Garamendi, CA
Raul R. Labrador, ID                 Edward J. Markey, MA, ex officio
Kristi L. Noem, SD 
Bill Johnson, OH
Doc Hastings, WA, ex officio

                                 ------                                
                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Thursday, July 14, 2011..........................     1

Statement of Members:
    Bishop, Hon. Rob, a Representative in Congress from the State 
      of Utah....................................................     2
    Denham, Hon. Jeff, a Representative in Congress from the 
      State of California, Statement submitted for the record....    71
    Grijalva, Hon. Raul M., a Representative in Congress from the 
      State of Arizona...........................................     3
        Prepared statement of....................................     4
    Hastings, Hon. Doc, a Representative in Congress from the 
      State of Washington........................................     5
    Walden, Hon. Greg, a Representative in Congress from the 
      State of Oregon............................................     6
        Prepared statement of....................................     8

Statement of Witnesses:
    Crews, David, Superintendent, Norwood School District, 
      Norwood, Colorado..........................................    56
        Prepared statement of....................................    58
    Dauzat, Caroline McRae, Owner, Rex Lumber....................    25
        Prepared statement of....................................    27
    Morrison, Anna, Legislative Chair, Oregon Women in Timber....    53
        Prepared statement of....................................    55
    Pearce, Hon. Paul, Chair, Skamania County Board of 
      Commissioners, National Association of Counties Partnership 
      for Rural America..........................................    22
        Prepared statement of....................................    23
    Tenney, David Porter, Chairman, Board of Supervisors, Navajo 
      County, Arizona............................................    50
        Prepared statement of....................................    51
    Vaagen, Duane, President, Vaagen Brothers Lumber Company, 
      Colville, Washington.......................................    15
        Prepared statement of....................................    16
    Wagner, Mary, Associate Chief, U.S. Forest Service, U.S. 
      Department of Agriculture..................................     9
        Prepared statement of....................................    11

Additional materials supplied:
    ``Community Forest Trust, A Pilot Project to Compliment 
      Secure Rural Schools and Community Self Determination Act 
      Reauthorization'' submitted for the record.................    69
    Moyer, Steve, Vice President for Government Affairs, Trout 
      Unlimited, Letter submitted for the record.................    72
    ``Proposing a Community Forest Trust'': Statement submitted 
      for the record by Boundary County, Idaho; Clearwater 
      County, Idaho; Idaho County, Idaho; Shoshone County, Idaho; 
      and Valley County, Idaho...................................    73
                                     



OVERSIGHT HEARING ON ``SECURE RURAL SCHOOLS REAUTHORIZATION AND FOREST 
       MANAGEMENT OPTIONS FOR A VIABLE COUNTY PAYMENTS PROGRAM.''

                              ----------                              


                         Thursday, July 14 2011

                     U.S. House of Representatives

        Subcommittee on National Parks, Forests and Public Lands

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to call, at 10:07 a.m. in 
Room 1334, Longworth House Office Building, The Honorable Rob 
Bishop [Chairman of the Subcommittee] presiding.
    Present: Representatives Bishop, Young, McClintock, Rivera, 
Tipton, Labrador, Noem, Johnson, Hastings [ex-officio], 
Grijalva, DeFazio, Holt, and Garamendi.
    Also Present: Representatives Southerland, McMorris Rodgers 
and Herger.
    Mr. Bishop. The Subcommittee will come to order. The Chair 
notes the presence of a quorum. The Subcommittee on National 
Parks, Forests, and Public Lands is meeting today to hear 
testimony on the challenges facing our timber and resource-
dependant communities with economic viabilities being shut down 
by current Federal policies. With the authorization for Secure 
Rural School Program expiring and the prospect of long-term 
decline in funds available, for discretionary or non-
discretionary Federal spending we will have the opportunity to 
be creative and are willing to consider options that have been 
different from the recent past.
    So this hearing is simply the first step in that process. I 
am pleased that I am not going to have to read that next 
paragraph, alright, yet. Under the rules, opening statements 
are limited to the Chair and Ranking Member of the Subcommittee 
and Full Committee. However, I am going to ask unanimous 
consent to include any Members' opening statements in the 
record if submitted to the clerk by the close of business 
today. Hearing no objection, so ordered. I am going to further 
ask unanimous consent for two of our colleagues to attend this 
hearing.
    No Member of Congress has been a more thoughtful or 
creative advocate for rural schools than Mr. Walden and it is 
our good fortune that he will be here to testify today. 
Likewise, our colleague Cathy McMorris Rodgers and Steve 
Southerland are not members of the Subcommittee but they have 
agreed to take part in today's hearing, both to introduce one 
of our witnesses as well as to participate in the hearing. I 
ask unanimous consent for these Members of Congress to take 
part in today's hearing, Hearing no objection, I also ask 
unanimous consent for Wally Herger, who I think will be able to 
join us later, to be able to sit on the dais and participate in 
this hearing. And, obviously if Chairman Hastings or Ranking 
Member Markey show up, at what stage they will show up, we will 
allow them to give an opening statement at that point. Hearing 
no objection, so ordered.

STATEMENT OF THE HON. ROB BISHOP, A REPRESENTATIVE IN CONGRESS 
                     FROM THE STATE OF UTAH

    Mr. Bishop. We thank everyone for being here. In the 
history of education, public lands have always been used for 
funding education. It goes back when Henry VIII took property 
from the church, and he gave it to the nobles only on the 
condition that they maintain and fund the schools that were 
started by the church. In 1777, Georgia was the first state 
that actually authorized state funding for education and half 
the counties rejected it because it was an insult to their 
ability to pay for themselves.
    Connecticut sold two million--actually three million acres 
of land to create a public trust fund for education. Of course, 
the land they sold was in Ohio, but at least they were selling 
something. Texas maintained their own debt, but they also set 
aside 17,000 acres as a permanent trust fund for education.
    Unfortunately, in the last few decades the ability of 
education to be funded by use of our public lands and private 
lands has seriously been eroded. Actually, it has been the last 
100 years it has been seriously eroded, but especially in the 
late 1980s and the 1990s it was a time where that became 
difficult.
    Those of us in the West, west of Denver, clearly understand 
the situation where half of our land, one of every two acres, 
is owned by the Federal Government and controlled by the 
Federal Government, and if one looks at the situation, those of 
us in the West pay a higher percentage of our income in state, 
local, and Federal taxes, significantly higher than the East. 
The West has always had a more difficult time in funding its 
education program if you look at the 20 years before Mr. 
Grijalva and I came here to Congress, whereas in the East their 
education funding was increased by 68 percent. Those of us in 
the West increased our education funding by only 33 percent, 
less than half even though we pay more taxes and we have more 
kids, and our enrollment is growing--and that in the East is 
not growing.
    Once again, the problem goes back to the lack of use of our 
lands to generate the funds necessary from property tax and 
severance tax, and even income tax from jobs that could be 
generated from that particular land.
    We are now talking about a program to secure rural schools 
which I would have to classify as probably a good situation of 
hush money. Instead of allowing the lands to be productive to 
fund our education, we have an effort to try and bribe counties 
so they will be satisfied by not being allowed to use their 
lands. That is one of the situations I want to look at.
    For the last 11 years, the Secure Rural School Program has 
been providing a safety net of kinds for rural communities in 
response to the Federal Government's inability to manage land 
and resources and actually pay for education as it was 
traditionally intended to be. I think every state has some 
example of that.
    As we reach a rapidly approaching debt ceiling and our 
current deficits of this year, one to two trillion dollars, 14 
trillion total in debt, the United States is running out of 
funding options for all programs. This is one of those programs 
which now requires us to look differently than we have in the 
recent past at how we use our lands, and for what purpose we 
will use our lands, and how our kids can be helped in the 
future.
    I returned from South Dakota over this last weekend, where 
I saw the results of the mountain pine beetle epidemic in the 
Black Hills. One of the witnesses at the hearing, a local mill 
owner, pointed out that the Black Hills now have four times the 
standing timber as it did 100 years ago, and the number 
continues to rise while the timber harvest continues to 
decline. As a result, this one single bug, which is a native to 
the Rocky Mountain West, has killed millions of acres of trees, 
an incredible waste of a resource, put communities at risk for 
catastrophic wild fires, and doesn't help our kids.
    Unfortunately, that is just one of the examples of forest 
health problems that plague our national forests across this 
country.
    Now is the time for us, especially since Secure Rural 
Schools needs to be reauthorized, to look at long-term 
solutions to address the real underlying problem. It is time 
for us to try and think outside the box instead of what we have 
traditionally been doing. We have significant problems. We have 
a significant challenge. This is our chance to meet that 
challenge.
    So, I look forward to hearing from our witnesses for 
creative ideas for moving forward, to doing the right thing on 
this issue. We can no longer afford to allow regulatory 
gridlock, our timber wars to stand in our way of providing 
education for our kids, and basic infrastructure for our rural 
communities located in places where the Federal Government has 
become an absentee landlord.
    I thank you for being here. I look forward to the ideas. I 
want you to know this is, as I said, the first step in a 
process. We are going to be talking about this as a committee 
and as groups for quite some time to come.
    Mr. Bishop. With that, I recognize the gentleman from 
Arizona, Mr. Grijalva, for his opening statement.

   STATEMENT OF THE HON. RAUL GRIJALVA, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF ARIZONA

    Mr. Grijalva. Thank you, Mr. Chairman, and welcome to all 
the witnesses on both panels.
    Across this nation, rural communities and the Federal 
Government are neighbors. The century goal when our population 
was less than one-third of what it is today, it made perfect 
sense to help support rural communities by sharing with them a 
portion of the returns from timber harvests on public land. 
This funding created an incentive for local governments to 
increase timber production to fund rural schools and rural 
roads. Thanks to this program, along with the others like the 
Mining Law of 1872, the Homestead Act the western United States 
prospered.
    Unfortunately, poorly managed logging left our forests 
overcut, our water polluted and wildlife habitat degraded. We 
now recognize that tying Federal assistance to local 
communities to the level of timber produced from the area can 
make effective forest management more difficult and, even in 
the best of times, lead to funding instability and uncertainty 
for local governments.
    The Secure Rural Schools and Self-Determination Act of 2000 
recognized these challenges and provided temporary intervention 
to help rural communities transition to other more sustainable 
economic models. In 2006, the Republican Majority allowed this 
program to lapse, but in 2007, the new Majority provided a one-
year extension. In 2008, Congress passed a four-year 
reauthorization of the Secure Rural Schools Program.
    The Administration has proposed a five-year reauthorization 
of the program. I look forward to hearing the views of our 
witnesses on this proposal. It is vital that we recognize the 
needs of rural counties, but it is also important to remember 
the lessons we have learned from past approaches and avoid 
repeating those same mistakes again and again.
    With that, let me yield back and thank you, Mr. Chairman.
    [The prepared statement of Mr. Grijalva follows:]

       Statement of The Honorable Raul Grijalva, Ranking Member, 
        Subcommittee on National Parks, Forests and Public Lands

    Across this Nation, rural communities and the Federal Government 
are neighbors. A century ago, when our population was less than one-
third what it is today, it made perfect sense to help support rural 
communities by sharing with them a portion of the returns from timber 
harvests on public land.
    This funding created an incentive for local governments to increase 
timber production to fund rural schools and rural roads. Thanks to this 
program, along with others like the Mining Law of 1872 and the 
Homestead Act, the Western United States prospered.
    Unfortunately, poorly-managed logging left our forests over-cut, 
our water polluted, and wildlife habitats degraded. We now recognize 
that tying federal assistance to local communities to the level of 
timber produced from the area can make effective forest management more 
difficult and even in the best of times, lead to funding instability 
and uncertainty for local governments.
    The Secure Rural Schools and Community Self-Determination Act of 
2000 recognized these challenges and provided a temporary intervention 
to help rural communities transition to other more sustainable economic 
models.
    In 2006, the Republican Majority allowed the program to lapse but 
in 2007, the new Majority provided a one-year extension and in 2008, 
Congress passed a four-year reauthorization of the Secure Rural Schools 
program.
    The Administration has proposed a five year re-authorization of the 
Secure Rural Schools program. I look forward to hearing the views of 
our witnesses on this proposal. It is vital that we recognize the needs 
of rural counties but it is also important to remember the lessons we 
have learned from past approaches and avoid repeating the same 
mistakes.
                                 ______
                                 
    Mr. Bishop. Thank you, Mr. Grijalva.
    We will now turn to our witnesses. We appreciate once again 
you all being here with us. Mr. Walden, we are going to start 
with you. Actually, let me introduce you all first. The 
Honorable Greg Walden from the State of Oregon who has, as I 
said, been involved in this issue before he was born; Mary 
Wagner who is the Associate Chief of the U.S. Forest Service--I 
appreciate having you here again; Duane Vaagen who is the 
President of Vaagen Brothers Lumber, Incorporated, thank you 
for being here; Paul Pearce, the Chairman of the, and I didn't 
know how to pronounce this one, what is your county?
    Mr. Pearce. Skamania.
    Mr. Bishop. That is an easy thing to say. I am not even 
going to go there. Anyway, thank you for being here and for 
your nice--never mind. He is the County Board of Commissioners 
and also from the National Association of Counties, and 
Partnership for Rural America; and finally, Caroline Dauzat.
    Ms. Dauzat. Dauzat.
    Mr. Bishop. Dauzat. Can I just call you Smith and get it 
over with? Anyway, Ms. Dauzat, I thank you for being here. You 
are the owner, I understand, of Rex Lumber, and I appreciate 
you being here.
    Before I actually turn it over to you, the Chairman of the 
Full Committee has arrived, and as I said, under our rules is 
allowed to give an opening statement. I would ask if he is 
desirous of doing that.
    Mr. Hastings. I would like to
    Mr. Bishop. Then we yield the time to the Chairman.

    STATEMENT OF THE HON. DOC HASTINGS, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF WASHINGTON

    Mr. Hastings. I certainly appreciate the consideration that 
you give me and I apologize for coming in a little bit late, 
but as you know it seems like there are always fires to put out 
someplace, so I appreciate that.
    For over a century the U.S. Forest Service has paid one-
quarter of its gross receipts from timber sales, mineral 
extraction, leases, grazing and other fees for using national 
forest lands for use on schools and roads in over 700 rural 
counties where 193 million acres of national forests are 
located across the country, mostly in the western states. 
Additionally, the Bureau of Land Management has historically 
paid about half the revenue receipts on some 2.5 million acres 
of BLM-owned land in western Oregon known as ONC Trust Lands.
    As we discuss the importance of revenues to these counties' 
timber sales, timber sales which should be the primary source 
of those revenues has deeply declined from a high in the late 
1980s of over half a billion dollars to just $186 million last 
year. That is an 88 percent drop. The result has been a 
staggering loss of jobs and economic productivity in rural 
forest communities. This serious decline of revenues is due in 
large part to Federal environmental and regulatory policies in 
environmental lawsuits over the past 20 years--exacerbated by 
this Administration, which has blocked or shut down timber 
sales in active forest management.
    More Federal land acquisition, wilderness designation and 
other restrictive management of existing lands has resulted in 
a billion dollars in Federal maintenance backlogs and 
increasing risk of catastrophic wild fires that emit tons of 
carbon into the atmosphere and sediment into the streams and 
rivers, and also results in more disease in dying trees.
    Rather than maintain the status quo program that yields 
less revenue for counties, current statutory authorities should 
be reviewed to allow harvesting of more timber to make forests 
healthier and more economically viable for state and local 
governments to use for schools and other local needs.
    So I look forward to this hearing. I am particularly 
interested in--I am sure this Committee is interested in 
hearing from the Forest Service on how the Administration can 
reconcile the finalization of the revised forest planning rule 
of the Northern Spotted Owl Recovery Plan which, of course, was 
released recently.
    So, I just want to say that I look forward to working with 
my colleagues on this as we move forward. I know that our good 
friend from Oregon, Mr. Walden, has been very active in this in 
the past, and I certainly look forward to working with him, and 
Paul Pearce, of course, is somebody that has darkened my door 
many, many times on this issue, but I look forward to working 
on this to try to find a right resolution.
    With that, I yield back my time. Thanks for the courtesy.
    Mr. Bishop. Thank you, Mr. Chairman.
    With that,] we will now turn to the panel. Congressman 
Walden, you are up.

STATEMENT OF THE HON. GREGORY PAUL WALDEN, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF OREGON

    Mr. Walden. Thank you very much, Mr. Chairman, Chairman 
Hastings, Ranking Member Grijalva. It is an honor to be before 
this wonderful committee on which I used to serve. I appreciate 
the opportunity to share some comments with you today.
    This is both an important and timely hearing, and I am 
encouraged that your Committee has taken this up and is 
interested in identifying long-term solutions for our Federal 
forest counties and the people who live there. I want to 
recognize my colleague from Oregon who proves that real men can 
wear pink, Congressman Peter DeFazio. We have had productive 
discussions and agree that the status quo serves no one well 
and that it is time for real change.
    In 2000, as you mentioned, Congress authorized county 
payments in recognition that layers of environmental 
regulations had throttled timber production on Federal lands 
that deprived the local communities of timber receipts that 
helped fund local schools, roads, and emergency services. I 
would direct your eyes to this chart where the gold line shows 
the drop in Federal timber harvest from a high of nearly five 
billion board feet in the mid-1980s to less than one-half a 
billion in 2009. And since 1990, Federal timber harvests have 
dropped more than 90 percent while harvest on private lands has 
remained at a stable sustainable level.
    This year the third reauthorization of county payment 
expires, and more than nine million school children in 729 
counties nationwide will be impacted. I think we can all agree 
the status quo doesn't work and will not work going forward. 
Our communities don't even want the status quo. They don't want 
the handout that has made them dependent on the Federal 
Government. They want jobs. They want healthy forests. They are 
tired of the catastrophic fires and bug infestations. They are 
sick of the bludgeoning uncertainty that comes with not knowing 
if Uncle Sam will pay his fair share. They want the ability to 
pursue the American ideal of self-reliance once more.
    When county payments were created in 2000, it was thought 
of as a bridge payment so rural counties could transition away 
from their resource-based economy. But let us get real. These 
are Federal forested counties. The government controls more 
than half of the land in most of them and nearly 80 percent in 
some, and the notion that they have the ability to re-create 
their economies in a decade's time is simply absurd.
    The Federal Government owns most of the land but has all 
but stopped productive forestry on it. It is shutting down 
public access to it, fails largely to produce economic value or 
renewable energy from it, and all too often stands idly by and 
lets it go up in smoke every year. The loss of county payments 
will be felt most in western states like Oregon where the 
Federal Government owns 60 percent of the forests but only 
produces just 12 percent of the timber harvest as seen in 
orange on both of these pie charts. The mortality rates are 
above 19 percent on Federal forest lands. That is not a healthy 
picture.
    Private forests in Oregon produce 73 percent of the 
harvested timber with a mortality rate of just 3.8 percent, 
maintaining a net growth rate of 22 percent. And according to 
the Forest Service timber harvest on Federal lands nationwide, 
nationwide has fallen 80 percent since 1990, while wild fires 
have burned an average of 7.8 million acres every year for the 
last five years, an area larger than the State of Maryland. 
Meanwhile, there is an unemployment crisis in many rural 
counties. In central, southern and eastern Oregon unemployment 
is commonly well into the double digits.
    Here on the monitors we are going to take a 30-second trip 
through time, 30 years of it as mill closures and job losses 
occurred in Oregon. From 1980 to 2010, we went from 405 open 
mills to just 106 open mills, a 74 percent decrease in capacity 
available to do work in the woods. We went from 45,778 mill 
jobs to 15,706 in that time, a 66 percent loss of jobs.
    My colleagues, this isn't an opportunity to act. This is an 
obligation to act and deliver a real solution, one that puts 
Americans back to work on public lands, makes our forests 
healthy for habitat and taxpayers alike, and spares communities 
of the uncertainty of wondering every four years if the Federal 
Government will owe up to its end of the bargain.
    Now here are some thoughts for the Committee to consider. 
Paralysis by analysis, and litigation that push Federal 
forested counties to the brink. There is bipartisan agreement 
that using HFRA-style, pre-decisional objection and expedited 
judicial review processes could help. There is also an 
understanding that in order to get the job done there should be 
exemptions for certain qualifying projects or appeals in 
litigations. Trusts also work. Nationwide land trusts annually 
return billions to beneficiaries from resources on state public 
lands.
    Chairman Hastings and Congresswoman McMorris Rodgers know 
well, their state is a good example. 2.9 million acres are 
managed by the Washington Department of Natural Resources in 
trusts for schools. In 2005, they produced gross revenues of 
nearly $300 million. Trusts work in Arizona, and in New Mexico, 
too, and on a nationwide basis trusts could help keep the 
school doors open, keep the roads in good repair, keep sheriffs 
and deputies on patrol while families sleep well at night. 
These are just a few ideas.
    I appreciate the Committee coming together today to look at 
this long-running problem and helping us tackle this difficult 
issue and taking charge to find a solution.
    With that, Mr. Chairman, I yield back the negative balance 
of my time. I appreciate your indulgence and I look forward to 
working with the Committee on a solution. And if I could, Mr. 
Chairman, I actually have to chair the Subcommittee on 
Cybersecurity that is going to meet here soon, so I will 
probably have to depart.
    [The prepared statement of Mr. Walden follows:]

 Statement of The Honorable Greg Walden, a Representative in Congress 
                       from the State of Oregon 

    Chairmen Bishop, Hastings, Ranking Member Grijalva, and fellow 
witnesses:
    Thank you for the opportunity to testify.
    This is an important and timely hearing.
    I'm encouraged by the Committee's interest in identifying a long-
term solution for our federal forest counties and the people who live 
there.
    I recognize my colleague from Oregon, Congressman Peter DeFazio. 
We've had productive discussions and agree that the status quo serves 
no one well. It's time for real change.
    In 2000, Congress authorized county payments in recognition that 
layers of environmental regulations had throttled timber production on 
federal lands, depriving local communities of timber receipts that 
helped fund local schools, roads, and emergency services.
    This year, the third reauthorization of county payments expires and 
more than 9 million school children and 729 counties nationwide will be 
impacted.
    I think we can all agree that the status quo doesn't work and won't 
work going forward.
    Our communities don't even want the status quo. They don't want the 
handout that's made them dependant on the federal government. They want 
jobs. They want healthy forests. They're tired of the catastrophic fire 
and the bug infestation. They're sick of the budgeting uncertainty that 
comes with not knowing if Uncle Sam will pay his fair share.
    They want the ability to pursue the American ideal of self-reliance 
once more.
    When county payments was created in 2000, it was thought of as a 
bridge payment so rural counties could transition away from a resource-
based economy.
    But let's get real. These are federal forest counties, the 
government controls more than half the land. . .nearly 80 percent in 
some counties. . .and the notion that they have the ability to recreate 
their economies in a decade's time is absurd.
    The federal government owns most of the land, but has all but 
stopped productive forestry on it, is shutting down public access to 
it, fails largely to produce economic value or renewable energy from 
it, and all-too-often stands idly by and lets it go up in smoke every 
year.
    The loss of county payments will be felt most in Western states 
like Oregon, where the federal government owns 60 percent of the 
forests, but only produces just 12 percent of the timber harvest--as 
seen in the ORANGE on both of these PIE CHARTS. \1\
---------------------------------------------------------------------------
    \1\ Oregon Forest Resources Institute. Federal Forestland in 
Oregon: Coming to Terms with Active Forest Management of Federal 
Forestland. 2010.
---------------------------------------------------------------------------
    The mortality rates are above 19 percent on federal lands. That's 
not a healthy picture.
    Private forests in Oregon produce 73 percent of the harvest, with a 
mortality rate of 3.8 percent, maintaining a net growth rate of 22 
percent. \2\
---------------------------------------------------------------------------
    \2\ Ibid.
---------------------------------------------------------------------------
    According to the Forest Service, timber harvest from our federal 
lands nationwide has fallen nearly 80 percent from 1990, while 
wildfires have burned an average 7.8 million acres a year for the last 
five years--an area larger than the state of Maryland.
    Meanwhile, there is an unemployment crisis in many rural counties. 
In central, southern, and eastern Oregon, unemployment is commonly well 
into the double digits.
    Here on the monitors we're going to take a trip in 30 seconds 
through 30 years of mill closures and job losses in Oregon. From 1980 
to 2010, we went from 405 open mills to just 106 open mills--a 74 
percent decrease in capacity available to do work in the woods. We went 
from 45,778 mill jobs to 15,706 in that time--a 66 percent drop.
    My colleagues, this isn't an opportunity to act. This is an 
obligation to act. . .and deliver a real solution. . .one that puts 
Americans back to work on public lands, makes our forests healthy for 
habitat and taxpayer alike, and spares communities the uncertainty of 
wondering every four years if the federal government will owe up to its 
end of the bargain.
    Here are some thoughts for the committee to consider.
    ``Paralysis by analysis'' and litigation have pushed federal 
forested counties to the brink. There's bipartisan agreement that using 
the HFRA-style pre-decisional objection and expedited judicial review 
processes would help.
    There is also an understanding that in order to get the job done, 
there should be exemptions for certain qualifying projects from appeals 
and litigation.
    Trusts also work. Nationwide, land trusts annually return billions 
to beneficiaries from resources on states land. Chairman Hastings' 
state is a good example.
    2.9 million acres are managed by the Washington Department of 
Natural Resources in trust for schools. In 2005, they produced gross 
revenues of nearly $300 million. Trusts work in place in Arizona and 
New Mexico, too. \3\
---------------------------------------------------------------------------
    \3\ Lincoln Institute of Land Policy. Managing State Trust Lands. 
2010
---------------------------------------------------------------------------
    On a nationwide basis, trusts could help keep the school doors 
open, keep the roads in good repair, and keep the sheriff's deputies on 
patrol while families sleep at night.
    These are just a few ideas.
    I appreciate the committee coming together today to look at this 
long-running problem and helping us tackle this difficult issue and 
taking charge on a solution.
                                 ______
                                 
    Mr. Bishop. Mr. Walden, we appreciate you being here with 
us today. You used to be a member of this Committee, this 
Subcommittee.
    Mr. Walden. Yes.
    Mr. Bishop. We miss you on that. However, if you were still 
a member, you would be the Chairman and I wouldn't, so maybe I 
don't miss you all that much.
    [Laughter.]
    Mr. Walden. Given your superior looks and ability, I 
probably would have yielded that gavel to you, sir
    Mr. Bishop. And I won't say what Chairman Hastings just 
said here either. But we do appreciate it, and thank you. We 
realize you have a schedule that requires you to be elsewhere. 
Thank you for being with us. We will dismiss you at this time.
    For those of you on the Committee, the rest of the panel, 
obviously Ms. Wagner has been here before and understands this, 
we are asking you that you keep your oral testimony to five 
minutes. When you speak, the green light will go on. When you 
see the yellow light come on, you have one minute left. When 
the red light comes on, I am supposed to gavel you into 
silence, but if you would sum it up very quickly that won't 
necessarily happen.
    Ms. Wagner, it is good to see you again here as a witness. 
For you, as with everyone else, your written testimony will 
appear in the record, and you are recognized for five minutes 
for an oral version of your testimony.

          STATEMENT OF MARY WAGNER, ASSOCIATE CHIEF, 
         FOREST SERVICE, U.S. DEPARTMENT OF AGRICULTURE

    Ms. Wagner. Thank you, Mr. Chairman and Members of the 
Subcommittee. It is good to be here. Thank you for the 
opportunity to present the view of the United States Department 
of Agriculture regarding Secure Rural Schools Reauthorization 
and Forest Management Options for a Viable County Payment 
Program.
    The President's Fiscal Year 2012 budget proposal 
reauthorizes the Secure Rural Schools Act. We recognize the 
economic difficulties rural communities have experienced in 
recent years. At the same time, we understand the need to 
manage the Federal budget thoughtfully and deliberately for 
deficit reduction. We would like to work with Congress to 
develop a proposal that addresses both.
    I am going to focus my comments on the benefits the Secure 
Rural Schools Act as it relates to natural resources and the 
agency's intention to continue to actively restore forests and 
grass lands for the benefit of citizens.
    The Secure Rural Schools Act provides an important 
mechanism to maintain and improve the health of our forests and 
watersheds and to create jobs. The Forest Service really values 
the relationships fostered with tribal and county officials, 
and all stakeholders in the 118 resource advisory councils 
under the Secure Rural Schools Act.
    The resource advisory committee (RAC) process of reviewing 
and recommending projects has resulted in projects with broad-
based support that help provide jobs in rural communities, 
support local businesses and help create a more self-sustaining 
community. In a study done at the University of Oregon it was 
found that every dollar of public investment in forest and 
watershed restoration projects is multiplied in economic 
activity 1.7 to 2.6 times as it cycles through Oregon's 
economy.
    In numerous cases RACs working together have forced 
relationships in a spirit of collaboration which is 
contributing to restoration efforts beyond the Secure Rural 
Schools-funded projects but across the county and across the 
landscape. Community capacity has grown to support 
collaborative work which has resulted in more on-the-ground 
accomplishments, better and more defendable decisions, and 
efficient implementation of projects.
    I would like to highlight a few key agency efforts to 
increase restoration on national forests. The President's 
budget is designed to support the Administration's priorities 
for maintaining and restoring the resiliency of America's 
forests. The President's budget includes a proposal to create 
the integrated resource restoration budget line item which 
allows us to effectively integrate interdisciplinary 
restoration treatments.
    Integrated resource restoration aligns the budget structure 
with a focus on landscape scale restoration and we expect it 
will increase accomplishments, focus on priority landscapes, 
and increase efficiency and effectiveness on the ground. Within 
integrated resource restoration, there is increased funding for 
the collaborative forest landscape restoration fund which 
provides an increased emphasis on protecting and enhancing 
forest and watershed health. This is a real opportunity to 
showcase the value of collaborative landscape scale 
restoration.
    In 2010, we received 31 proposals, only 10 were funded but 
an additional 26 proposals have been provided in 2011. it just 
tells us there is a lot of capacity and communities and 
citizens are working together to put these proposals together. 
There are additional opportunities to strengthen our landscape 
scale restoration, including working on projects that weren't 
selected under the Collaborative Forest Landscape Restoration 
Fund (CFLR) funding through collaborative work with groups such 
as the Nature Conservancy, local watershed councils and other 
community-based organizations that work on landscape scale.
    Forest and regions are finding means to invest in work in 
these landscapes because of the up front collaboration and 
agreement to action.
    Another tool we use to restore forests and provide jobs and 
economic activities is stewardship contracting. It involves 
close collaboration with local communities and a focus on new 
and emerging markets for forest products removed, and 
restoration activities. Stewardship contracts can achieve 
multiple outcomes on large landscapes over time, and we look 
forward to working with Congress on authorizing this valuable 
tool.
    The Forest Service has recently completed a national bark 
beetle strategy which prioritizes treatments to focus on health 
and safety, recovery and resiliency of the landscapes impacted 
by bark beetle. We expect to treat our 230,000 acres this 
fiscal year, investing a little over $99 million in western 
regions. We have also launched a NEPA project to increase our 
efficiency through select demonstration projects and to also 
seek categorical exclusions to support restoration across the 
landscape.
    The Secure Rural Schools Act has provided more than a 
decade of payments to eligible states and counties to help fund 
schools and roads. It has also created a forum for community 
interest to participate, and so the selection of projects and 
assist in community fire protection planning. We would like to 
build on the successes over the last decade and would like to 
work with the Subcommittee to provide much needed support to 
rural communities, and to responsibly address the Federal 
deficit and actively restore our landscapes. Thank you.
    [The prepared statement of Ms. Wagner follows:]

    Statement of Mary Wagner, Associate Chief, U.S. Forest Service, 
                United States Department of Agriculture

    Mr. Chairman and Members of the Subcommittee, thank you for the 
opportunity to present the views of the U.S. Department of Agriculture 
regarding the reauthorization of the Secure Rural Schools and Community 
Self-Determination Act of 2000, (Secure Rural Schools Act), as amended 
and reauthorized in 2008 (P.L. 110-343), and forest management options 
for a viable Program providing payments to States, which distribute the 
funds to eligible counties.
    The Forest Service and Secretary Vilsack have an ambitious vision 
for managing our forests. We are focused on restoration and 
conservation efforts that make forests healthier and reduce the 
likelihood and impacts of catastrophic fires like those we have seen 
this year. These restoration efforts also protect watersheds and create 
jobs. The Secure Rural Schools Act is one of the tools we use to 
maintain and improve the health of our forests and watersheds, and to 
create jobs.
Secure Rural Schools Reauthorization
    The President's fiscal year 2012 budget proposes to reauthorize the 
Secure Rural Schools Act, extending for five more years the enhanced 
payments to States to ease the transition to the reduced amount of the 
25-percent payments for public schools and roads. We recognize the 
economic difficulties rural communities have experienced in recent 
years. At the same time, we understand the need to manage the federal 
budget thoughtfully and deliberately for deficit reduction. We would 
like to work with the Congress to develop a proposal that addresses 
both concerns.
Purpose and history of the Secure Rural Schools Act
    Since 1908, the Forest Service has shared 25-percent of gross 
receipts from national forests with states to benefit public schools 
and public roads in the counties in which the national forests are 
situated. The receipts on which the 25-percent payments are based are 
derived from timber sales, grazing, minerals, recreation, and other 
land use fees, deposits and credits.
    In the late 1980s, the 25-percent payments began to decline 
significantly and fluctuate widely, due largely to a significant 
decline in timber sale receipts. Congress responded to these declines 
by providing ``safety net payments'' to counties in northern 
California, western Oregon and western Washington for fiscal years 1994 
to 2003. The safety net payments were enhanced payments intended to 
ease the transition to the reduced amount of the 25-percent payments.
    Before the safety net payments expired, Congress enacted the Secure 
Rural Schools Act, which provided the option of decoupling the payments 
from receipts and authorizing enhanced, stabilized payments to more 
states for fiscal years 2000 through 2006. The Secure Rural Schools Act 
provided eligible counties with two options. A county could elect to 
receive its share of the State's 25 percent payment, which fluctuated 
based on receipts, or the county could elect to receive its share of 
the State's ``full payment amount,'' which was a stabilized amount.
    Congress later appropriated payments to States for fiscal year 2007 
and in October 2008, amended and reauthorized the Secure Rural Schools 
Act for fiscal years 2008 through 2011. The purpose of this 
reauthorization was to stabilize payments that help fund public schools 
and roads, and to ease the transition to the reduced amount of the 25-
percent payments.
    The primary change in the Secure Rural Schools Act as reauthorized 
was a new formula for the stabilized ``State payment''. The new formula 
includes a ramp down of funding each year and incorporates a factor for 
per capita personal income to address differences in economic 
circumstances among counties. In addition, the 2008 reauthorization 
amended the Twenty-Five Percent Fund Act (16 USC 500) to reduce 
fluctuations in the 25-percent payments by basing the payments on a 
rolling average of the most recent seven fiscal years' percent 
payments. The reauthorization further increased the number of States 
and counties that participate.
    The final Forest Service State payment under the Secure Rural 
Schools Act will be approximately $324 million for fiscal year 2011. In 
addition, the Department of the Interior will provide approximately $40 
million in SRS payments to Oregon. If Secure Rural Schools is not 
reauthorized, in fiscal year 2012, all eligible States will receive the 
25-percent payment to States using the new formula based on a seven-
year rolling average of 25-percent payments. The total of 25 percent 
payments for all States is projected to be approximately $64 million 
for fiscal 2012 from the Forest Service. In addition, the Department of 
the Interior would make approximately $5 million in payments to Oregon.
    The Secure Rural Schools Act has three principal titles with 
complementary objectives.
Title I--Secure Payments for States and Counties Containing Federal 
        Land
    The Act directs that the majority of the State payment be used to 
help fund public schools and roads in counties in which national 
forests are situated. This portion of the payment, commonly called 
title I funds, has averaged about 85 percent of the total State 
payments to date. For fiscal years 2008 through 2011, title I funds are 
projected to total nearly $1.5 billion.
Title II--Special Projects on Federal Land
    An eligible county may allocate a portion of its share of the State 
payment to title II for projects that enhance forest ecosystems, 
restore and improve the health of the land and water quality and 
protect, restore and enhance fish and wildlife habitat. These projects 
provide employment in rural communities and opportunities for local 
citizens on resource advisory committees (RACs) to advise the Forest 
Service on projects of mutual interest that benefit the environment and 
the economy. For fiscal years 2008 through 2011, title II funds are 
projected to total $172 million for projects recommended in more than 
300 counties.
Title III--County Funds
    Funds allocated by a county to title III may be used for activities 
under the Firewise Communities program, for reimbursement for emergency 
services on national forests, and for preparation of a community 
wildfire protection plan. For fiscal years 2008 through 2011, title III 
funds are projected to total $87 million.
Secure Rural Schools Act Successes
    The Forest Service values the relationships fostered with tribal 
and county officials and stakeholders under title II. Members on the 
118 RACs represent diverse interests such as tribal, county and school 
officials, conservation groups, recreation interests, commodity 
producers, and members of the public.
    The RAC process of reviewing and recommending projects leads to 
projects with broad-based support that help provide jobs in rural 
communities, support local businesses and help create more self-
sustaining communities. In a study done at the University of Oregon, it 
was found ``that every dollar of public investment in forest and 
watershed restoration projects is multiplied in economic activity 
between 1.7 and 2.6 times as it cycles through Oregon's economy.'' 
i The collaboration improves the quality of the projects and 
resolves differences early in project development. The projects 
actively restore and improve forest watersheds and ecosystems, 
increasing their resiliency in the face of climate change and 
catastrophic events.
---------------------------------------------------------------------------
    \i\ Max Nielsen-Pincus and Cassandra Moseley, The Employment and 
Economic Impacts of Forest and Watershed Restoration in Oregon, EWP 
Briefing Paper number 23, http://ewp.uoregon.edu/publications.
---------------------------------------------------------------------------
    The resource advisory committees' role in reviewing title II 
projects is an important part of the suite of tools the Forest Service 
needs for actively managing the national forests to restore ecosystem 
health and provide local employment.
Management Opportunities, Options, and Other Tools
    The President's budget is designed to support the administration's 
priorities for maintaining and restoring the resiliency of America's 
forests, specifically healthy forests and grasslands, clean air and 
water, wildlife habit, and recreation opportunities. To support this, 
the President's budget includes a proposal to create the Integrated 
Resource Restoration (IRR) budget line item which will allow us to 
effectively integrate interdisciplinary restoration treatments that 
will protect and improve our water resources, habitat, and vegetation 
treatments, including fuels reduction. We support sustaining our 
forests by increasing the collaborative efforts for restoration 
activities that create jobs. Within IRR, there is increased funding for 
the Collaborative Forest Landscape Restoration Fund (CFLR) which 
provides an increased emphasis on protecting and enhancing forest and 
watershed health. There will be additional opportunities to strengthen 
landscape-scale restoration, including projects not selected for CFLR 
funding, through collaborative work with groups such as The Nature 
Conservancy, watershed councils, and other community based 
organizations that work on a landscape scale to improve watershed 
condition, wildlife habitat, native plants, and fuels condition. 
Statewide Assessments, developed collaboratively, can be used to 
provide an analysis of each State's forest conditions and trends while 
working to enhance public benefits from trees and forests. At the same 
time, the Statewide Assessments prioritize the conservation of working 
forest lands.
    We will continue to track not only the traditional targets, but 
also the overall outcomes of forest restoration and watershed 
improvement so that we can show our progress at the landscape scale. It 
is clear that well-managed forests enhance communities and their 
economies.
    Another tool we use to restore forests and provide jobs and 
economic activity is stewardship contracting. Stewardship contracting 
is not intended to replace timber sales, which we will continue to use 
as an important tool, as well. But where appropriate, stewardship 
contracts can achieve multiple outcomes on large landscapes over time. 
By rebuilding infrastructure, stewardship contracts create local jobs 
and stimulate the local economy.
    We have found that with stewardship contracting, multi-year 
contracts work best, because they stabilize the flow of work and 
materials over time, stimulating investments. Our stewardship 
contracting authority will soon expire. We look forward to working with 
Congress on reauthorizing this valuable tool.
Secure Rural Schools Reauthorization
    We recognize that funding a reauthorization for the Secure Rural 
Schools Act will be challenging. To make the Forest Service related-
payments to States for the last three years the Treasury has made-up 
the shortfall of nearly $1.1 billion between available receipts and the 
payments required by statute. Our proposal balances the need to support 
these communities while managing the federal budget. It continues the 
transition to the reduced amount of the 25-percent payments while 
building on the successes of the current program by doubling funding 
for Title II. This and other budget proposals like IRR will increase 
active management to reduce fuels and improve ecosystem health. These 
activities could increase revenues but they would likely still fall 
short of the current level of payments.
Conclusion
    The Secure Rural Schools Act has provided more than a decade of 
payments to eligible States and counties to help fund public schools 
and roads and has provided predictably declining payments as states 
transition back to the 25-percent payment. It has also created a forum 
for community interests to participate collaboratively in the selection 
of natural resource projects on the National Forests, and assisted in 
community wildfire protection planning. The Forest Service would like 
to build on the successes of the last decade and would like to work 
with the Subcommitttee to provide needed support to rural communities 
and responsibly addresses the federal deficit.
                                 ______
                                 
    Mr. Bishop. Thank you for your testimony. We welcome Mr. 
Vaagen who his here and to introduce him to the Committee I 
would like to turn to Representative McMorris Rodgers.
    Mrs. McMorris Rodgers. Thank you, Mr. Chairman, and I 
appreciate the chance to be here today and to introduce my good 
friend Duane Vaagen from Colville, Washington.
    Since 1980, Duane has served as President of Vaagen 
Brothers, a second generation family owned timber company with 
over 175 employees. Duane is well regarded in the community and 
among his peers. He has spent his entire career in the forest 
products industry and is a pioneer, leading innovator and his 
expertise is beyond compare. Because of these attributes Duane 
has been recognized as timber processing man of the year, one 
of the highest honors in his field.
    Duane and his family have the distinction of having many 
firsts. They were the first to move their business into small 
log processing, and the first to utilize single grip harvesters 
for mechanical harvesting, all to support better forest 
management. As an innovator, Vaagen's is one of the very few 
businesses in the forest products industry to remain viable in 
both good times and bad. Duane has the foresight and the 
expertise to know what action is required to make our forests a 
healthy and viable industry again.
    Let me point out one example with the Colville National 
Forest. After decades of litigation and conflict between 
environmentalists, businesses, grazers, recreationalists and 
other parties Duane successfully brought these diverse interest 
groups to the table and developed a comprehensive strategy for 
elevating the forests beyond the conflict. Through our 
collaborative efforts, Duane and I are proud to report that the 
Colville National Forest has been litigation-free for over a 
decade, and was named one of the top three national forests by 
the Forest Service.
    Recently, a leading and well-respected forester told me 
that because of Duane Vaagen, we have had more successes in the 
Colville National Forest than any other western state. Today, 
we find our forest management system broken and the flaws in 
the system fostering policies that deviate from effective 
management. Because of these policies our forests are overgrown 
and they have become vulnerable to disease and bug 
infestations. Like so many government programs, our forest 
management policies have created a system of dependency that is 
unsustainable in both the short and the long run, and there is 
no better example than Secure Rural Schools. This program is a 
direct result of government intervention on behalf of the 
spotted owl, and made our counties more dependent on the 
Federal Government than ever.
    I believe, and Duane will tell you that there are ways we 
can give our local counties more control, improve forest 
management, create middle class jobs, and return money back to 
the Federal Government. I trust that this Committee and 
Congress will use Duane as a resource and strongly consider his 
recommendations, so please join me in welcoming Duane and all 
of our witnesses, and especially those from Washington State. I 
look forward to hearing from them all.
    Thank you very much, Mr. Chairman.

             STATEMENT OF DUANE VAAGEN, PRESIDENT, 
                  VAAGEN BROTHERS LUMBER, INC.

    Mr. Vaagen. Thanks for the kind introduction. My 
presentation can be shorter now. That was very kind.
    Mr. Chairman, Committee Members, it is a pleasure to be 
here. We have lived this crisis beyond the 20 years that we 
say. I have been President of Vaagen Brothers for 31 years. It 
is good when I own the company. They can't fire me. But we have 
been through so many crises. You know, when you have a losing 
team you get rid of the head coach. Well, it takes persistence 
to survive in this industry, and I appreciate the witnesses 
here today.
    Again, the history is the debate in the woods started long 
before the counties' schools proposition. It started in the 
seventies, and people had to react, so we re-tooled to go to 
small diameter because the environmental community was pushing 
that, and that is a good thing. So we believe in safe, healthy, 
and clean forest. But the forest has been neglected the last 20 
years, so what we have done is built up more and more fuel, and 
consequently as we harvest less we burn more. We have less jobs 
and poor economics in rural communities.
    Right now, there are 60 million acres in dire straits of 
treatment, but there is some good news. The collaboration has 
shown us many ways to get there. We have been appeal and 
litigation free, but our forest, we have only harvested 4,000 
acres a year in the last 10 years. That is not enough. Through 
the collaboration efforts, which we helped form, we are 
agreeing in 80 million feet, around 15,000 acres a year. I 
think that is great, but now we have a mountain pine beetle 
epidemic that just came on us last year. This year it has 
doubled in size and next year it will double again. People in 
Colorado, Wyoming, and Montana all know that story very well.
    But through collaboration we can move forward and what we 
want to demonstrate is we can return money to the treasury. 
Even though we deal in very small diameter stands, we pay $750 
an acre to thin those forests. If you go to other states, it 
may cost you $500, $750 to $1,000 an acre to thin the forest, 
and we have to move quickly on this.
    We have supported this Secure Schools proposition from the 
get-go. The RACs and the FLACs were a great idea. In our forest 
it didn't work. You can't go down from 100 million feet to 20 
million feet, and now we are stabilized around 30 million feet, 
and say that has worked. It hasn't worked. Its intention is 
good, but we have to get work done on the forests if we are 
going to save the forests prior to beetles and fire.
    Again, the mountain pine beetle is an epidemic spreading 
through our forest. I toured an Arizona forest six weeks ago 
before the fire. It is a green forest. I said they are 
fortunate, their forest is green. It may not burn. The day 
after I left it was on fire and burned 560,000 acres. New 
Mexico had their biggest fire in history. It is going to return 
to other western states.
    I will leave you Committee members with a copy of the book 
``The Big Burn,'' 1910 Fire, Montana, Idaho, Washington, three 
million acres, two days, 87 people perished. I think we are 
going to see things like that in our area. So please accept 
that, read that.
    What is going to fix this is we have to streamline NEPA. 
You can't have a beetle epidemic that you need to harvest 
within a year and spend a year-and-a-half trying to figure out 
how to do the planning process, so NEPA has to be streamlined 
on emergency efforts, and we have to have legislative mandates 
for the Forest Service so they can guide their way to the net 
results that we need.
    And as far as money to the treasury, it used to be before 
1992-1993, when this all started, you sold eight million feet a 
year, or 11 billion feet. Nowadays that dropped to two billion, 
but the price of logs and lumber doubled, so actually we could 
return to six billion feet and double the money that we used to 
have, so our recommendation is for significant treatment and 
quick resolution of these forest debates.
    Again, appreciate the Committee, my congresswoman, and look 
forward to any help that we may be able to offer. Thank you.
    [The prepared statement of Mr. Vaagen follows:]

 Statement of Duane Vaagen, President, Vaagen Brothers Lumber Company, 
                          Colville, Washington

    Good morning Mr. Chairman and members of the Subcommittee. I am 
Duane Vaagen, President of Vaagen Brothers Lumber, a family-owned 
forest products company located in Colville, Washington. I am here 
today to discuss the urgent need to restore responsible, sustainable 
management to our federal forests for the sake of our forests and rural 
communities.
    Vaagen Brothers Lumber was founded by my father and uncle in the 
early 1950s and has survived over the years by focusing on 
technological advancements, ecologically-minded forest management and a 
commitment to healthy forests and rural communities. We currently own 
and operate two sawmills in northeast Washington, employ over 175 
people and contribute $75 million to the local economy. We once 
employed 500 people and operated another two sawmills here in northeast 
Washington.
    Today our mills predominantly rely on small diameter timber, the 
primary bi-product of forest thinning operations. We also fully utilize 
the biomass component of forest management activities through a biomass 
co-generation plant. Unfortunately, for the past 15 years we have 
continually struggled to secure an adequate timber supply to ensure our 
continued operation. The primary reason for this shortage of raw 
materials is a lack of management and timber coming from the 1.1 
million acre Colville National Forest (Colville NF).
Declining Forest and Community Health
    The health of our nation's forests continues to decline and federal 
forests are most at risk due to overstocking, disease, drought, insect 
infestations and catastrophic wildfires resulting from a lack of sound 
management. In fact, the Forest Service classifies 60-80 million acres 
of National Forest land as being overstocked and at particular risk. 
Just last week a Forest Service report indicated that 50 million acres 
of forests in the continental U.S. were killed or seriously damaged by 
insects between 2003 and 2007, which was a three-fold increase over the 
previous five year period. This represents 8-percent of the total 
forested acres in the lower 48. As you know, federal forests throughout 
the West have been ravaged by the pine beetle.
    Meanwhile, over the past 30 years we have gone from over 700 lumber 
manufacturing mills in the West to a current level of approximately 
120. Many areas of the country, including Arizona, Utah, New Mexico and 
Colorado, are largely devoid of the forest products industry 
infrastructure (mills, loggers, etc) needed to restore and maintain the 
health of our forests and provide employment opportunities in rural 
communities. Here in northeast Washington we still have the integrated 
sawmill, logging, biomass and paper mill industries that are needed to 
effectively maintain the health of the forest and generate economic 
benefits for rural communities. Unfortunately, if something isn't done 
to increase the level of management on the Colville NF we will continue 
losing mills, jobs and our ability to treat the threats facing this 
forest. The recent fires in Arizona and New Mexico provide perfect 
examples of the consequences of inaction as well as benefits of 
treating the forest.
    As you know, the health of our rural communities also continues to 
decline. Unemployment in our local tri-county area currently sits at 
14-percent. It is not a coincidence that many of the counties with the 
highest unemployment rates in the country also happen to be those 
surrounded by federal forests. Many of these rural communities have 
lost their historical heritage as well as generations of forest 
stewards. I believe it will require decisive action now if we want to 
restore the health of our rural communities and our federal forests.
Collaboration
    Over the past decade my company has invested significant time, 
energy and money into collaboration. In fact, we helped form the 
Northeast Washington Forestry Coalition (NEWFC), which is comprised of 
the forest products industry, conservationists, local businesses and 
other stakeholders. The NEWFC has been a success--we haven't had a 
timber sale or stewardship project litigated on the Colville NF in 
nearly 10 years. We've had only one appeal. The Coalition has helped 
bring once warring sides together to find forest management solutions 
on the Colville NF built around a blueprint that identifies areas most 
appropriate for active forest management, restoration treatments and 
meeting conservation objectives.
    Despite agreement from all interested parties we have not seen 
meaningful progress from the Forest Service to restore the health of 
the forest or meet the needs of local industries and communities by 
offering an adequate supply of timber. We continue to support 
collaboration as an important component of federal forest management, 
but it alone does not address many of the current barriers to 
implementing a sustainable and predictable timber management program.
Secure Rural Schools/County Payments Program
    The Federal Government has actually been making payments to 
counties to make up for lost 25-percent timber receipts since the early 
1990's following the listing of the Northern Spotted Owl in Washington, 
Oregon and California. The current Secure Rural Schools program was 
first enacted in 2000 and has been extended twice since then. As you 
know, the program has provided billions of dollars to counties and 
schools over its lifetime. Our company has supported the National 
Forests Counties & Schools Coalition, the primary advocate of the 
Secure Rural Schools program. We've supported their efforts because we 
believed that one of the primary goals of the program was to transition 
back to the sustainable management of our federal forests. After nearly 
twenty years of experience in the Pacific Northwest and over a decade 
nationwide, it is clear that the program as currently designed will not 
address the fundamental threats to our federal forests and rural 
economies. The program has primarily succeeded at treating just one 
symptom of the illness, a lack of funding for local government services 
and schools due to the paralysis affecting federal land management. 
While we all support efforts to meet these critically important needs, 
I believe our political leaders can no longer avoid confronting the 
fundamental problem by treating just one symptom.
    As a resident of a rural community I certainly understand the 
dependency of many local governments on this funding to provide public 
sector jobs and services. Unfortunately, the overall health of many 
rural, forested communities has further declined over the past two 
decades due to our inability to rebuild private sector employment. In 
many forested communities the forest products industry is one of the 
few industries capable of providing meaningful employment opportunities 
and the tax base needed to provide long term economic and social 
stability.
    As Congress considers legislation to address the pending expiration 
of the Secure Rural Schools program I encourage you to seek a 
comprehensive solution to the illness and not just one symptom of it. 
We are running out of time to restore the health of our forests and 
maintain the industries important to the economies of rural 
communities.
Snapshot of the Colville National Forest
    The Colville NF provides a perfect example of how we can balance 
sustainable forest management, revenue generation and rural economic 
development with other objectives, including conservation. I have 
provided the Subcommittee pictures that show the type of responsible 
forest management we are advocating.
    As I mentioned the Colville National Forest is comprised of 1.1 
million acres. There is a strong consensus within our coalition for 
managing 500,000-600,000 acres for a mix of active management (timber, 
etc) and restoration objectives. Meanwhile, there is an urgent need to 
accelerate commercial thinning treatments on at least 250,000 acres of 
overstocked and beetle infested forest at risk to catastrophic 
wildfire. In recent years less than 4,000 acres have been mechanically 
thinned despite the support of the Coalition to treat between 15,000-
20,000 acres annually. I actually believe we should be restoring the 
health of the forest even more aggressively in the short term.
    My testimony includes charts that compare estimated outcomes of the 
Forest Service's current management with the approach supported by the 
Coalition in terms of the pace of forest restoration, timber value 
generated, jobs created and potential county receipts. These are 
estimates and can vary year to year based on market conditions, the use 
of stewardship contracting and other factors, but they provide a good 
snapshot of the opportunity that exists.
    The key to success is the existence of an integrated forest 
products industry, which allows treatments to actually generate revenue 
(approx $750 per acre) to be used for county receipts, on-the-ground 
restoration activities or the Treasury by removing enough merchantable 
material in the form of sawlogs. This is not the current reality in 
areas where the industry no longer exists and the taxpayer is picking 
up the tab to thin the forests at a cost of as much as $1,000 per acre.
Legislative Recommendations
    As your committee considers legislative options for restoring 
sustainable management to our federal forests as a key component of 
reauthorizing Secure Rural Schools, I would like to provide the 
following suggestions. These suggestions are based on the following 
assumptions: 1) securing significant increases in Forest Service 
appropriations to fund their current approach to managing these forests 
is unlikely under current and future budget realities; 2) the Forest 
Service and the federal government have a responsibility to the rural 
communities surrounded by our federal forests; and 3) we must 
significantly increase the pace of treatments if we are serious about 
getting ahead of the forest health crisis.
          Reduce the time and cost of Forest Service project 
        planning requirements, particularly in areas where consensus 
        exists. A NEPA Environmental Assessment or Environmental Impact 
        Statement on a single forest management project can take years 
        to complete and cost $500,000-$1 million to prepare. Real 
        progress is unlikely until the agency's project planning costs 
        are significantly reduced.
          Legislation could be passed to give projects that 
        meet a certain criteria for responsible management and/or enjoy 
        collaborative support some relief from appeals and/or 
        litigation if those are liming the sustainable management of 
        some forests.
          Enact legislation to hold the Forest Service 
        accountable for managing forests to maintain forest health, 
        generate economic activity and provide a minimum level of 
        receipts for local governments. The Forest Service needs clear 
        direction from Congress.
          Amend the Stewardship Contracting Authority to give 
        counties the option of receiving 25% of the retained receipts 
        and specifically give the agency the authority to use retained 
        receipts for future project planning costs.
          Consider reforming the Forest Service to separate 
        fire fighting and forest management functions. The Forest 
        Service has largely become a fire fighting agency, not a land 
        manager.
          Divert a portion of ever-increasing wildfire 
        suppression costs to actually get ahead of the problem though 
        increased forest management. This will create additional 
        funding and certainty to help bring new industry infrastructure 
        (and jobs) to the forests and rural communities where it has 
        been lost.
          If the Forest Service is unwilling or unable to 
        deliver these relatively modest economic returns to local 
        communities and improvements to forest health then states or 
        counties should be given the authority to plan and implement 
        forest management projects.
    I appreciate the opportunity to appear before the Subcommittee 
today. I would be happy to answer any questions you may have.
Attachments:
        (1)  Bark Beetle Infestation in the West, USDA FY12 Budget 
        Justification
        (2)  National Forest Growth, Removals and Timber Volume Sold 
        Graphs
        (3)  Colville National Forest Management Outcomes Graphs
        (4)  Pictures of Forest Treatments on the Colville National 
        Forest
                                 ______
                                 
                                 [GRAPHIC] [TIFF OMITTED] 67404.002
                                 

                                                                  
Mr. Bishop. Thank you, Mr. Vaagen. Now we will turn to Mr. Pearce.

   STATEMENT OF PAUL PEARCE, CHAIR, SKAMANIA COUNTY BOARD OF 
 COMMISSIONERS, NATIONAL ASSOCIATION OF COUNTIES, PARTNERSHIP 
                       FOR RURAL AMERICA

    Mr. Pearce. Thank you very much, Mr. Chairman, Chairman 
Hastings, Ranking Member Grijalva, Congresswoman McMorris 
Rodgers who has always had her door open for these 
conversations and has worked hard on this issue all the way 
back to when she was in the Legislature in Washington. Thank 
you very much.
    I want to thank the members of the Committee and the 
Subcommittee, and I thank you for the invitation to appear 
before you today to discuss this issue, Secure Rural Schools 
and Forest Management Options for Viable County Payments, and 
if I may add, finding a long-term answer to economically 
healthy, productive forests, counties and schools because we 
need all three.
    I am here today as Chair of the Federal Payment 
Subcommittee of the NACO's Public Lands Committee, and as an 
executive board member of the Partnership for Rural America 
Campaign for Reauthorization. But finally, I am the Chair of 
the Skamania County Board of Commissioners, a county which at 
one time produced up to a quarter of the Federal timber 
harvested in Washington State.
    Twenty-four percent of the nation's 3,000 plus counties 
contain national forests, some, like my own, covering up to 90 
percent of their land. These 154 national forests cover 139 
acres. These counties are responsible for maintaining the 
infrastructure, the roads, the schools, search and rescue, and 
other emergency services that allow these forests to be 
enjoyed. The 1908 Act fulfilled the promise of Gifford Pinchot 
when he said that no community would suffer for hosting these 
lands, and the partnership at that time that we created between 
the Federal Government and the counties with revenue sharing, 
the first in the nation, of 25 percent revenues worked well 
until the late eighties when court decisions and endangered 
species listings both in the Northwest and the South 
dramatically reduced Federal timber production.
    In 2000, Congress passed Secure Rural Schools to address 
the loss of revenue, but at that time the conversation was 
around increased forest production. We had another 
reauthorization in 2007. We were still having that government. 
The current authorization in 2008, again conversations around 
production. We appreciate that the Act was reauthorized in 
2008, and it runs out this year, and I want to take a moment to 
sincerely thank you and the other members of the Committee who 
voted for its passage and helped to make that happen.
    According to Dr. Eylers' economic study, which I have 
attached to my written, these payments have an impact of 1.3 
billion in sales, 188 million realized tax revenues, and most 
importantly, represent 11,000 jobs in those mostly rural 
communities. Forest management is imperative.
    NACO's platform, and I quote here, ``supports the 
reauthorization and enhancement of Secure Rural Schools 
Program. Reauthorization should maintain coupling between 
payments to counties and active natural resource management and 
the connection between sustainable natural resource management 
and the stability and well being of forest communities and 
counties.''
    Attached to my written testimony you will find a White 
Paper from the Partnership for Rural America titled 
``Maintaining the Partnership Today and in the Future'' which 
details many suggestions for changes in forest management, 
including fixing the biomass definition, expedited harvest of 
beetle killed timber, allowing counties and schools to retain 
75 percent of receipts, just to name a few.
    Contrary to what many believe, the vast majority of county 
commissioners would much rather have a vibrant economy with 
hundreds of jobs based on healthy sustainable productive forest 
management on these lands. I would gladly trade these dollars 
for the over 1,200 jobs I once had on the Gifford Pinchot 
Forest in my own county, not to mention the four mills we had, 
and the 300 Forest Service jobs. Did I mention 300 Forest 
Service jobs? We had the Northwest Nursery, out at the Wind 
River Nursery, and there were over 300 people employed there, 
both part time and full time.
    Returning directly to 25 percent receipts has two critical 
problems. The first is the Forest Service actual receipts 
dropped so low last year that there would have been less than 
$65 million available for all 729 forest counties and 4,400 
school districts, in 42 states. We need to remember that the 
2008 Act changed 25 percent to a seven-year rolling average, 
meaning we would have to have five years of significant 
production if we are going to return to the 25 percent money.
    Finally, stewardship contracting is not the answer for a 
variety of reasons that I can address, not the least of which 
is the lack of revenue sharing with counties or the national 
treasury.
    In closing, NACO and the Partnership stands ready to assist 
in crafting a solution to both the county payments issue long 
term, as well as sustainable productive forest management. 
Thank you, sir.
    [The prepared statement of Mr. Pearce follows:]

Statement of The Honorable Paul Pearce, Commissioner, Skamania County, 
 Washington, on behalf of The National Association of Counties (NACo) 
             and the Partnership for Rural America Campaign

    Good afternoon Chairman Bishop, Ranking Member Grijalva, members of 
the committee and subcommittee. I appreciate the opportunity to appear 
before you today to discuss Secure Rural Schools reauthorization and 
Forest Management options for a viable County Payments program and if I 
may add. . .a long term answer to economically healthy forest counties 
and schools.
    I am here today testifying as Chair of the Federal Payments 
Subcommittee of NACO's Public Lands Committee, as an Executive Board 
member of the Partnership for Rural America Campaign for 
reauthorization, and finally as the Chair of the Skamania County Board 
of Commissioners, a county which once produced, fully a \1/4\ of all 
the timber harvested in Washington State.
    Twenty-four percent of the nation's three thousand plus counties 
contain national forests, some like my own totaling up to 90% of their 
land mass. These 154 National Forests cover 193 million acres across 
the country. These forest counties are responsible for maintaining 
infrastructure like roads, schools, emergency services
    The 1908 Act fulfilled the promise of Gifford Pinchot who said that 
no community would suffer for hosting these lands. The partnership 
established between the federal government and rural forested counties 
called for revenue sharing...the first in the nation...where 25% of all 
revenues generated on these lands is returned to the communities.
    The contract worked well for nearly a century. . .until the late 
1980's when court decisions, Endangered Species Listings, such as the 
spotted owl in my area of the country and re-cockaded woodpecker in the 
south dramatically reduced timber production and other extraction. In 
2000 Congress passed the Secure Rural School and Communities Self 
Determination Act to address the drastic loss of revenue from the 
decline in timber production. This was followed by a one year 
reauthorization in 2007 and the current authorization in 2008 which 
ends this year. I want to take a moment to sincerely thank you and the 
other Members of the Committee who voted for its passage and helped 
make that happen.
    The 2008 reauthorization came at the same time as the economy was 
beginning to fall apart. According to Dr Eylers economic analysis 
(attached) these payments have an impact of $1.3 billion in sales, $188 
million in realized tax revenue and most importantly represent 11,000 
jobs in these most rural communities. These will be lost the first 
year.
    Failure to reauthorize in 2012 will be devastating to those 
counties and schools dependant on this act and the prior forest 
receipts it is based on.
    Consider for a moment had this loss had occurred at the same time 
as the full force of the recession hit. This is especially 
disconcerting, in these mostly rural communities where the loss of one 
family wage job often results in the entire family having to leave the 
community to find work
Forest Management
    NACo's platform. . .and I quote here. . .``supports the 
reauthorization and enhancement of the Secure Rural Schools program (PL 
110-343). Reauthorization should maintain coupling between payments to 
counties and active natural resource management; and the connection 
between sustainable natural resource management and the stability and 
well being of forest counties and communities.''
    Attached to my written testimony you will find a white paper from 
the Partnership titled ``Maintaining the Partnership Today and in the 
Future'' which details numerous suggestions for changes in Forest 
Management including Fixing the Biomass Definition, Expedited Harvest 
of Beetle Kill Timber, Allowing Counties and Schools to Retain 75% of 
Receipts: just to name a few.
    Contrary to what many believe. . .we County Commissioners. . .would 
much rather have a vibrant economy with hundreds of jobs based on 
healthy sustainable productive forest management on these lands. I 
would gladly trade these dollars for the over 1200 jobs I once had on 
the Gifford Pinchot forest in my County.
    The Forest Service has failed over the past two decades in healthy 
forest management and in producing revenue through timber sales. 
Interestingly the nation's consumption of wood products continues 
unabated. The Forest Service is not clear on their mandate or their 
mission. In the mid-90's because of the spotted owl the Clinton 
administration created the Northwest Forest Plan setting timber harvest 
targets on all forests. None of which has to date been met. This was a 
clear mandate and failed miserably. Congress must find a way to require 
production at the line level through incentives or disincentives that 
affect these career officers. There is no other way to implement any 
initiatives Congress may create or impose.
    Returning directly to 25% receipts has two critical problems. The 
first is that Forest Service actual receipts are so low that last year 
there would have been less than $65 million dollars available for all 
729 counties and 4400 school districts, in 42 states...We also need to 
remember that the 2008 Act changed 25% receipts from a year-to-year 
amount into a seven year rolling average. It would take at least 5 
years of much higher production before the payments could be replaced.
Stewardship
    Finally, stewardship contracting is not the answer for a variety of 
reasons. The forest service has adopted stewardship contracting as the 
panacea for dismal timber production. Stewardship contracting requires 
a collaborative process. These collaborative are intended to have 
participation by people on all sides of the timber issues. On the north 
half of the Gifford Pinchot National Forest in the Randle District the 
collaborative took 10 years to produce a single 11 million board foot 
sale. A forest executive told me that based on this collaboration the 
new timber rotation is 300 years. This is a forest that produced an 
average of 350 million board feet per year from the 70's until 1991. 
Even the NW Forest plan calls for 50 million board feet per year. No 
revenue is produced for the counties, schools or treasury from these 
sales. Instead the forest line officers negotiate for restoration or 
other work in exchange for the actual dollars. I am aware of at least 
two contracts where the forest ended up owing the successful bidder 
money at the end of the day. This so called collaborative process of 
decision by committee of those that can commit untold volunteer hours 
against paid environmental staffers is a poor way of doing business and 
certainly not in the end scientifically based.
O&C
    There has been discussion around the O&C Counties in Oregon and a 
bill which would allow for these lands to be divided, with half being 
sold for production and the other half in conservation. While I have no 
disagreement with the O&C proposal it cannot be described as a 
``model'' for possible action with National Forest lands unless a 
radical change is made to the enabling legislation. O&C lands were 
created in 1937 specifically for revenue production for the counties. 
The counties receive 50% of receipts, 25% remain on the land and only 
25% are sent to the treasury. On the contrary National Forests were 
created in 1908 as multiple use and not dedicated to revenue 
production. In fact the counties receive only 25% of the receipts and 
the remaining 75% are sent to the treasury.
    In closing NACo and the Partnership stand ready to assist in 
crafting a solution to both the County Payments issue long term as well 
as sustainable productive forest management and we must begin right 
now.
    [NOTE: Attachments have been retained in the Committee's official 
files.]
                                 ______
                                 
    Mr. Bishop. Thank you very much. Now Ms. Dauzat. Am I 
getting close?
    Ms. Dauzat. You are getting closer
    Mr. Bishop. I am still butchering your name. I apologize 
deeply for that. So since I can't do it well I am going to ask 
Congressman Southerland if he would do the honor of simply 
introducing you as our next witness.
    Mr. Southerland. Thank you, Mr. Chairman. I don't have a 
nice prepared statement that Kathy had, so thank you for 
throwing me under the bus here. But I will tell you that 
Caroline Dauzat, and that is my attempt, that her family has 
businesses in our district, and so I am going to speak from the 
heart for just a moment and introducing her family, so this is 
not a prepared remark.
    I want you to know that her family provides jobs, and they 
never provided jobs because of a jobs bill. They provided jobs 
because they believed in what they did. They believed that they 
met a need, that our country needed it, especially our 
district, and so her family she is now the fourth generation of 
sawmill owners in her family.
    Four hundred hardworking men and women go to work every day 
because they are allowed to work. They get up at 3:30 in the 
morning, they live in an environment that is--workers comp. 
would rate it as the most dangerous in the country. They risk 
their lives. I know about the risk because my brother used to 
work for her family. Three weeks ago my brother was in the 
hospital because of an injury in the woods. We rushed him, and 
it was a head injury, and these people just want to work, and 
her family has been a part of that in our district, and I thank 
her for being here. She has never been to the Hill to testify, 
and so, without any further ado, I thank you for your courage 
of coming, and I hope you find a committee here that is ready 
to embrace what you say. Thank you, Caroline.

                 STATEMENT OF CAROLINE DAUZAT, 
                       OWNER, REX LUMBER

    Ms. Dauzat. Thank you. Good morning, everyone, Mr. Chairman 
and Members of the Committee, and Representative Southerland. 
Thank you for inviting me to appear before you today.
    My name is Caroline McRae Dauzat. I am a fourth generation 
sawmill owner with three sawmills in the following locations: 
Brookhaven, Mississippi; Graceville and Bristol, Florida. In 
addition to the sawmills, we also own a pilot plant in Bristol 
as well as a timber procurement company. I have submitted my 
full statement to the Committee which I ask be made part of the 
hearing record.
    My qualifications include working with my father and 
brother over the last 10 years in all capacities of our forest 
products businesses. After receiving my Master's in Business 
Administration degree from Loyola University, I began my 
sawmill career the summer of 1998 in and around the woods of 
Bristol, Florida. My current role with our organization 
includes all aspects of financial risk and human resource 
management.
    My father established Rex Lumber Bristol or North Florida 
Lumber, as it was known then, in 1980. He chose Bristol as the 
mill location primarily because of the close proximity to the 
vast resources of Apalachicola National Forest. According to my 
father, at the time of locating the mill the Forest Service 
verbally promised us a sustained yield of timber from the 
forest in order to support our mill and the local community.
    The promise made at that time has long been disregarded. 
The purpose of my testimony is to offer a view of management of 
the forest in our area and offer our plan as an existing end 
user.
    Rex Lumber is one of many diverse forest products 
industries within the timber shed of the Apalachicola. Products 
manufactured include lumber, plywood, extract board, pulp and 
paper, wood pellets, and a biomass-fired electrical power 
plant. Such a diverse infrastructure offers an unusually solid 
base for management of our local national forest.
    Unfortunately, management of the national forest has been 
hampered by a number of factors and often neglects a healthy 
timber market in pursuit of other purposes, frequently related 
to environmental concerns. Ironically in an effort to meet 
those concerns the health of the forest is put in serious 
jeopardy.
    As my first handout of Deep Creek clearly shows, proper 
timber management is essential to environmental integrity. 
Currently the Apalachicola is only cutting 6.8 percent of its 
annual growth. In the 1980s, when the forest was productively 
managed, our mill could count on up to 80 percent of its raw 
material coming from the Apalachicola. Today our Bristol mill 
receives less than one percent of total logs from the forest 
though it sits at our absolute door step.
    Our southern forests are young, healthy, and productive, 
but if poor management continues our forest will face the same 
problems as the Western forests have been dealing with, beetles 
and fires. In our region it is the southern pine beetle that 
would be destroying our timber, and 2011's fire season should 
be enough evidence that management practices need to improve.
    An extreme example of where poor forest management leads is 
the Dixie National Forest in Utah. As shown in the second 
handout, on approximately 600,000 acres of timberland, 
mortality has exceeded growth. One hundred and five percent of 
the total annual growth was lost to fire, insects and disease. 
Our forests are too valuable a resource to continue on this 
path. Although with 30 percent mortality on growth, the 
Apalachicola is on its way. Solutions exist for these problems.
    In order for the Forest Service to do what it is required 
by the Multiple Use Sustain Yield Act of 1960, it will have to 
re-order its priorities and shift funds to more productive 
activities. Streamlining environmental documentation and 
outsourcing some field work would get foresters out of the 
office and into the field. Including resource advisory 
committees in every annual planning and project selection 
process will contribute to a more balanced community-oriented 
forest work program. Of key importance, NEPA, ESA needs to be 
amended to increase appellant and litigant accountability.
    Last, Congress should consider requiring selected national 
forests to test the feasibility of timber program self-
financing as is now done on DOD land. Please see my written 
testimony for further detail.
    In summary, I believe the best solution for funding the 
rural schools is the utilization of the assets already 
available; that is, timber with a market ready to go. As we 
work together so that such a program can be adopted and 
implemented, we appreciate your work to reauthorized the safety 
net of the Secure Rural Schools and Community Self-
Determination Act.
    Finally, Mr. Chairman and Committee Members, I want to 
thank you again for allowing me to appear here today. I am here 
as a prospective partner with the Forest Service in forest 
management, hopefully a part of the solution to the problem 
facing our national forests. I would be most happy to work with 
any of you and your staff to find a solution to the long-term 
health of our national forests and adequate funding for our 
rural schools. Thank you.
    [The prepared statement of Ms. Dauzat follows:]

 Statement of Caroline McRae Dauzat, Family Business Owner, Rex Lumber

    Good morning, Mr. Chairman, and Members of the Committee thank you 
for inviting me to appear before you today.
    My name is Caroline McRae Dauzat. I am a fourth generation sawmill 
owner with three sawmills in the following locations: Brookhaven, 
Mississippi, Bristol and Graceville, Florida. In addition to the 
sawmills we also own a pole and piling plant in Bristol, as well as a 
timber procurement company that supplies timber to our operations. I 
have submitted my full statement to the committee, which I ask be made 
part of the hearing record.
    My qualifications include working with my father and brother over 
the last ten years in all capacities of our family forest products 
businesses. After receiving my Master's degree in Business 
Administration from Loyola University, I began my sawmill career the 
summer of 1998 in and around the woods of Bristol. My current role with 
our organization includes all aspects of financial, risk and human 
resources management.
    My father established Rex Lumber, Bristol, or North Florida Lumber, 
as it was known then, in 1980. He chose Bristol as the mill location 
primarily because of the close proximity to the vast timber resources 
of the Apalachicola National Forest. According to my father, at the 
time of locating the mill, the Forest Service verbally promised a 
sustained yield of timber from the forest in order to support our mill 
and the local community. The promise made at that time has long been 
disregarded.
    The purpose of my testimony is to offer a view of the management of 
the National Forest in our area and offer our plant as an existing end 
user. Rex Lumber is one of many diverse forest products industries 
within the timbershed of the Apalachicola. Products manufactured 
include lumber, plywood, oriented strand board, pulp and paper, wood 
pellets and a biomass-fired electrical power plant located 1 mile from 
the forest boundary. Such a diverse infrastructure offers an unusually 
solid base for management of our local National Forest
    Unfortunately, management of the National Forest has been hampered 
by a number of factors and often neglects a healthy timber market in 
pursuit of other purposes, frequently related to environmental 
concerns. Ironically, in an effort to meet those environmental 
concerns, the health of the forest is put in serious jeopardy. As my 
first handout of Deep Creek clearly shows, proper timber management is 
essential to environmental integrity.
    Currently, the Apalachicola National Forest is only cutting 6.8% of 
its annual growth. In the 1980's, when the forest was productively 
managed, our mill could count on up to 80% of its raw material coming 
from the Apalachicola. Today our Bristol mill receives less than 1% of 
total logs from the forest, though it sits at our absolute doorstep.
    Our southern forests are young, healthy and productive, but if poor 
management continues, our forests will face the same problems the 
western forests have been dealing with in the last decade: beetles and 
fires. In our region it is the southern pine beetle that will be 
destroying our timber and twenty eleven's fire season should be enough 
evidence that management practices need to improve.
    An extreme example of where poor forest management leads is the 
Dixie National Forest in Utah. As shown in the second handout on 
approximately 600,000 acres of timberland, mortality has exceeded 
growth--105% of the total annual growth was lost to fire, insects and 
disease. Our forests are too valuable a resource to continue on this 
path, although with 30% mortality on growth, the Apalachicola is on its 
way.
    Solutions exist for these problems. In order for the Forest Service 
to do what it is required by the Multiple Use, Sustained Yield Act of 
1960, it will have to reorder its priorities and shift funds to more 
productive activities. Streamlining environmental documentation and 
outsourcing fieldwork would get foresters out of the office and into 
the field. Including Resource Advisory Committees as full participants 
in every annual planning and project selection process, would 
contribute to a more balanced community-oriented forest work program. 
Of key importance, NEPA/ESA needs to be amended to increase appellant 
and litigant accountability. Lastly, Congress should consider requiring 
selected National Forests to test the feasibility of timber program 
self-financing, as is now done on DOD land. Please see my written 
testimony for further detail.
    In summary, I believe the best solution for funding the rural 
schools is the utilization of the assets already available--timber, 
with a market ready to go--rather than letting those assets deteriorate 
and die. As we work together so that such a program can be adopted and 
implemented, we appreciate your work to reauthorize the safety net of 
the Secure Rural Schools and Community Self-Determination Act.
    Finally, Mr. Chairman and committee members, I want to thank you 
again for allowing me to appear here today. I am here as a prospective 
partner with the Forest Service in forest management: hopefully a part 
of the solution to the problem facing our National Forests. I would be 
most happy to work with any of you and your staff to find a solution to 
the long-term health of our National Forests and adequate funding for 
our rural schools. I stand ready for any questions you may have.
[GRAPHIC] [TIFF OMITTED] 67404.001

                                 .eps__
                                 
    Mr. Bishop. Thank you very much for all of your 
testimonies. We will now turn to questions for the panel. I 
will actually go to Mr. Grijalva first for a time for 
questions.
    Mr. Grijalva. Thank you, Mr. Chairman. I am going to yield 
to my colleague Mr. DeFazio for first round of questions. Thank 
you.
    Mr. Bishop. Mr. DeFazio, you have been long working in this 
area.
    Mr. DeFazio. Thank you. Yes, in fact had I prevailed in the 
early nineties we wouldn't be here today. I opposed the Clinton 
forest plan because I said it wouldn't give us what either side 
desired. Environmental groups wanted more protection for the 
residual old growth, and the timber industry wanted more 
predictability of a sustainable harvest, and I predicted 
neither would get what they wanted and they haven't.
    And then second, when we did the first county school 
support payments my version of the bill would have made them 
permanent, then at time of surplus we could have passed that, 
but it was opposed by certain folks to create a cliff and now 
we are at the cliff again.
    So Associate Chief Wagner, I have to say your testimony was 
a little short on the details. There was one point where you 
kind of reference the Safe and Secure County Rural Schools Act, 
and that is it. You know, the President put it in his budget. 
As a candidate, he said repeatedly he would give us a long-term 
solution. And so I guess I would like to know what does the 
Forest Service propose to deliver either on the promise of a 
long-term solution or how do you intend to propose to implement 
the President's budgetary proposal of $328 million for Forest 
Service and BLM? This is not in your testation. I mean, I am 
trying with all the nice things that you said in there, but 
what are the specifics?
    Ms. Wagner. Thank you, Mr. DeFazio.
    In the written statement, there is a bit more about the 
history and the structure of the existing titles and 
administrations.
    Mr. DeFazio. Right, I read your entire, but I didn't find--
you didn't either reaffirm or propose how the Forest Service 
was going to find $328 million in its budget this year to 
deliver on the President's budgetary proposal.
    Ms. Wagner. Right. It was proposed in the Forest Service 
budget as part of our discretionary budget, the $328 million, 
to be followed with a specific proposal. I think, given the 
interest, the ideas that are being talked about in terms of 
Secure Rural Schools authorization, there is an opportunity to 
work together and craft something that works for both the 
Congress, the public, and the Administration.
    Mr. DeFazio. I guess working with, and I will be taking out 
some frustrations on you that I have with the Administration 
generally, but I see big sky plans, like $500 billion for 
transportation infrastructure. It is in his budget, he mentions 
it very occasionally, that is it. Are you telling me now that 
you don't have a specific plan and you are looking forward to 
working together, you haven't one yet, the President promised 
this when he was a candidate three years ago, it was in his 
budget in February, and I guess I am wondering--I mean, you 
have no specifics to give us today?
    Ms. Wagner. Well, there was a specific formulation in the 
President's budget.
    Mr. DeFazio. Yes, the declining payment, the 328 this year 
out of your budget, but what are your plans to find or make 
room for $328 million in your budget?
    Ms. Wagner. We have already gotten some feedback about 
provisions that in that structure that was proposed that are 
non-starters, and so we would like to work with you to put 
something together that is acceptable to Congress. The 
President's budget proposal included the $328 million in the 
Forest Service's discretionary budget.
    Mr. DeFazio. Right. OK. Let me ask with Mr. Vaagen's 
testimony. We have a forest that is ostensibly a model for 
collaboration. They haven't had litigation and they haven't had 
appeals. Yet they are only producing a tiny fraction of what 
was proposed by the collaborative group. What is the reason for 
that? Why can't you get near the number of the collaborative 
group when you don't have barriers of litigation and appeals? 
Either of the two can answer that. You can both give me a 
perspective quickly.
    Mr. Vaagen. I will go first. The reason we get is we don't 
have the staffing at the Forest Service or the budgets, but I 
propose that if you had seed money to get past the first hurtle 
it would perpetuate itself and make the government lots of 
money.
    Mr. DeFazio. OK.
    Mr. Vaagen. Because it does not make sense not to, so that 
is the bottom line. That is the simple answer.
    Mr. DeFazio. Associate Chief, what is the hold up? What is 
the barrier?
    Ms. Wagner. And I know from my experience in the Pacific 
Northwest that the Colville National Forest is a place where we 
had found the ability to provide carryover funding, if we had 
carryover funding. So prior year carryover into forests in the 
Colville we got an outcome. We got a project, a timber sale 
completed, so they can do.
    We are a little bit challenged by the investment we are 
making and the outcomes that we would like to realize and the 
two not quite matching up. So, part of our strategy is we have 
to stretch the appropriate dollar in every possible way to make 
the most of what it can do out there on the public lands. 
Collaborations, finding people to work with us who are forging 
great agreement about what we need to go after and how is 
making it easier. Being litigation free makes it easier, but we 
are not stretching the dollar as far as it needs to go to do 
the work necessary on the land.
    Mr. DeFazio. Or you don't have enough dollars.
    Mr. Vaagen. I would like to add it is the starter dollars, 
but this will work. The collaboration works. All the people 
want to do the 80 million feet. It has a return to the 
government. I think we do need new ideas. We need a lighter 
touch NEPA. We have to get after it quicker. The mountain pine 
beetle does not wait a season or two seasons for us. It eats 
every day. So we are ready, and it is a good question. I think 
we ought to get there and we ought to get there quickly.
    Mr. DeFazio. Thank you, Mr. Chairman
    Mr. Bishop. Thank you. Now, Mr. DeFazio, I don't know how 
much time you have to be here with us or if you have another 
engagement. We have a whole lot of people over here. Let me go 
through a couple. If you want to come back for another round 
before we do that.
    Mr. DeFazio. That will be all right, because I have 
something going on.
    Mr. Bishop. Works for me. Let me go to some questions on 
our side. First of all, the first person here was actually Mr. 
McClintock, if you have some questions.
    Mr. McClintock. Thank you, Mr. Chairman.
    We saw in the graph displayed earlier radical reduction in 
timber harvest on Federal lands over the past several decades. 
We know that it has devastated local economies. It has 
contributed to the nation's chronic unemployment. It has 
reduced revenues to the Federal Government it otherwise would 
have received through timber harvests, at the same time it has 
reduced revenues to local communities, particularly for local 
schools, which then requires the Federal Government to replace 
those lost funds. This was done in the name of health forests, 
and yet the forests are much less healthy as a result of these 
policies. Forest fires are now much more frequent and intense. 
A ranger explained it this way. He said that excess timber is 
going to come out of the forest one way or another. It is 
either going to be carried out or it is going to be burned out. 
When we carried it out, it contributed to both healthy forests 
and a healthy and prosperous economy. Now we are content to let 
it burn out.
    This is lunacy and I would like to get a perspective. Who 
is responsible for this?
    Ms. Wagner. Well, the Forest Service has the responsibility 
to administer the 193 million acres of national forest.
    Mr. McClintock. An area about the size of the entire State 
of Texas, by the way.
    Ms. Wagner. Right, so it is a lot of country, and we have a 
budget and there is----
    Mr. McClintock. How do you answer to this lunacy? Is this 
your fault?
    Ms. Wagner. We as a group of agency employees are working 
to do what is needed on the lands, make the resources that are 
appropriated by Congress.
    Mr. McClintock. That is not what I asked. Who is 
responsible for this lunatic policy?
    Ms. Wagner. I would say we are responsible for implementing 
the laws of Congress and the regulations that are promulgated 
by the Administration.
    Mr. McClintock. Perhaps some of the actual dickens of these 
policies might want to weigh in.
    Mr. Vaagen. Well, I will agree we are all responsible but I 
want to do something about it, and I want to do it quick.
    Mr. McClintock. The point is we are not all responsible. 
There are specific policies enacted by this Congress that are 
responsible, and there are bureaucracies that are responsible 
for carrying it out, and it is about time we held them 
accountable for the damage they have done to our forest and to 
our economy. Don't you think so?
    Mr. Vaagen. I agree with that statement.
    Mr. McClintock. I mean, Ms. Wagner, we are talking about 
the enormous holdings of the National Forest Service. I think 
it's probably one of the most valuable assets held by the 
people of the United States. What is the commercial value of 
the timber on your 193 million acres?
    Ms. Wagner. I don't have an estimate of the value of the 
commercial timber, but we can get that information for you 
maybe by way of----
    Mr. McClintock. I would love to get such an estimate. In 
fact, I find it appalling every time I have asked Forest 
Service representatives, they have no idea of the value of the 
timber that they are responsible to the people of the United 
States for managing. Why don't you know these things?
    Ms. Wagner. Well, I could make an estimate based on market 
conditions. They change their volatile. We do have an estimate 
of standing volume, so we do an inventory of the entirety of 
the nation's forests so we could tell you the type of wood 
fiber that is out there, the general size, the health and 
condition of it, so we have that kind of information, that kind 
of inventory. To put a market value on that, I would say it 
would be projection based on market conditions as they exist. 
It goes up and down depending on the value.
    Mr. McClintock. I would like to get those figures because I 
would like to know how much these policies are costing our 
country as well as our economy.
    Mr. Vaagen, you talked about the fact you harvest small 
diameter trees only. That seems rather counterproductive. Young 
trees, I assume, don't have nearly the commercial value of old 
trees. Sounds like the opposite of our fish and game policies. 
I really wonder what would be the future of our fish and game 
populations if we required taking only the young undersized 
individuals out of the population. Why are we doing that?
    Mr. Vaagen. Well, they are not all young little trees. We 
take two and a half inch up to 12 inch, and these are return 
stands of 1930, 1920 fires. Our county, 60 percent of it burned 
in that period. So we are thinning this out before it burns 
again so it survives the fire. It does have value of $750 to 
$1,000 an acre in stumpage alone. The government can keep the 
property. In our case if we were losing as much money the 
government would have to sell our assets, but in this case I 
say utilize them because they are sustainable and perpetual.
    Small logs do have higher value. Also, 15 percent of our 
product goes to Australia because it is stronger than the other 
product which didn't used to be the case 20 years ago, so we 
pioneered a lot of markets
    Mr. Bishop. Thank you. We are going to go through our 
committee members first in giving these questions. I am going 
to go to Mr. Grijalva next, and then in the order you all 
arrived, Mr. Johnson, Mr. Rivera, Ms. Noem, Mr. Labrador, and 
then our three who we have added to it at that point. Mr. 
Grijalva.
    Mr. Grijalva. Yes. Ms. Wagner, the testimony that would be 
presented today or has been presented already seems to indicate 
that the Forest Service is basically not logging any trees 
anywhere. So my very simplistic question is, is it accurate to 
say that--is that accurate or is logging still taking place?
    Ms. Wagner. Commercial logging is still taking place on 
national forests. We are estimating, in Fiscal Year 2010 we 
harvested about 2.5 billion board feet. In the President's 
budget proposal for 2012 we were projecting 2.6 billion board 
feet.
    Mr. Grijalva. I have, and correct me if I am wrong, but I 
have seen estimates that we have logged as much as 90 percent 
of large old growth timber on this Federal land. Given that 
that those large old growth trees are the most profitable to 
log, how has the loss of these trees impacted the Federal 
timber program?
    Ms. Wagner. Well, there was a time in our country when 
harvesting large old trees was what fueled the economy, built 
houses, and with Endangered Species Act societal values that 
changed, concern about endangered species, recovery of those 
species, we have put in place strategies that look at 
preserving the large old growth character that exists in 
forests say typically in the Pacific Northwest. So that affords 
us an opportunity to look at other forest stand conditions, so 
in the Pacific Northwest much of the activity, as Mr. Vaagen 
said, is taking place in second growth stands, so stands that 
have been harvested or clear cut at one time in their past, and 
have now re-generated, they are second growth and they can be 
managed. In some cases they are being managed to actually build 
in old tree characteristics over time so small diameter trees 
and select harvesting is taking place to get stand conditions 
that are favorable for species that we want to recover.
    Mr. Grijalva. And some of the testimony today claims that 
the demand for wood products remains very, very high. First of 
all, the first question, is that accurate? And has the economic 
downturn, particularly in home construction, caused a drop in 
the demand for wood? And have economic factors played a 
significant role in the loss of timber industry in this 
country? Getting that, is the issue more complicated than just 
deciding that we have to cut more trees?
    Ms. Wagner. Well, I think it is true economic conditions in 
the country have influenced the forest products sector. In the 
case of private landholders, they are hold onto their stumpage, 
their trees in the woods because of the low value of stumpage 
at this point in time. So the forest products industry is 
looking to public lands to help out.
    We certainly have the need to treat forests and we are 
trying to be responsive to that. Typically we have seen what we 
have offered has been sold.
    Mr. Grijalva. And last question. Today's hearing might lead 
some to believe that timber production is the only valuable use 
of our Federal land, our forest land. Is that true, and could 
you elaborate on that?
    Ms. Wagner. The restoration work we do on national forests 
is multi-fold in its benefits. We work on watershed 
restoration, so the value of clean water, clean air, healthy 
plant and animal communities, wildlife habitat, those are all 
values that people expect from national forests. The multiple-
use mandate of the Forest Service is an interesting challenge 
because we see forests as places to conserve and we see forests 
as places that we should use.
    Mr. Grijalva. Thank you. Yes, is it a very complex balance 
question that is part of this issue as well.
    With that, let me yield back, Mr. Chairman
    Mr. Bishop. Thank you. Mr. Johnson.
    Mr. Johnson. Thank you, Mr. Chairman, for holding this 
important hearing. I represent southeastern Ohio which is the 
home to Wayne National Forest, and while the counties in my 
district may not receive the same level of payments that the 
counties in some of my colleagues out West do, these payments 
are still an important revenue stream. If the Secure Rural 
Schools Program is not reauthorized, these counties in my 
district would have to cut services back even further than the 
current cuts that they have experienced.
    However, our country is at a crossroad when it comes to our 
debt crisis, and we understand that, and it is clear that the 
new formula authorized for the program through the 2008 TARP 
bill is not sustainable as we in Congress look for ways to rein 
in the Federal debt.
    One way though to ensure that these payments to counties 
are not drastically cut as a new formula is most likely 
authorized would be to increase timber receipts. That is why I 
am pleased that at least the second part of this hearing today 
is going to--is in regard to options for the U.S. Forest 
Service to create a viable program. Unfortunately what I am 
hearing is that the U.S. Forest Service is not actively working 
on a viable program that will increase timber production, and 
therefore increasing timber receipts, not to mention that as we 
will hear testimony today, and I have already heard some, an 
increase in timber production equals jobs and more tax revenue 
for those counties as well.
    Ms. Wagner, the Forest Service constantly says that it 
needs to increase management, increasing management, I believe 
part of that would be to increase timber production, thereby 
increasing timber receipts. In your testimony you called this 
an ambitious vision. Yet most of the actions of the agency 
achieve the opposite result. The case in point on the Colville 
National Forest as described by Mr. Vaagen you had one appeal 
and no litigation for 10 years and a proposal to increase 
management by four-fold, yet the agency still cannot implement 
it. What is the reason?
    Ms. Wagner. Before I became Associate Chief, I was Regional 
Forester in the Pacific Northwest Region, and I can tell you 
out of the forest units there in the Pacific Northwest there 
was no unit that didn't want to do--to treat more acres, and if 
we got additional national forest timber management money in a 
budget line item, there were high demands for that everything.
    So, my dilemma as a Regional Forester was if I needed to 
invest more in the Colville I had to pick another national 
forest where I had to diminish my investment, so that is part 
of the challenge is where do you invest, where the priority 
landscapes. We saw the Colville as a great investment area 
because we got results every time we invested there.
    Mr. Johnson. Well, you know, I am not a--I don't own a 
sawmill, so I am not in that type of business, but I am a 
little confused as to why it requires so much money to simply 
increase timber receipts. Help me understand that.
    Ms. Wagner. Before we do any action on a national forest we 
have to disclose the environmental effects of that activity to 
inform a decision around how we do that activity, how we might 
mitigate that activity. That is guided by the National 
Environmental Policy Act. We invest about $365 million across 
the Nation----
    Mr. Johnson. Basically what you are saying is that here is 
another example of regulatory activity, environmental 
regulatory activity that is hampering America's economy. We 
study these things but we don't produce anything. We do a lot 
of talking, we do a lot of analysis. When are we going to open 
up these lands and let private companies go in and get that 
timber out. We have already heard testimony that it is either 
going to burn out or we are going to haul it out. Why don't we 
want to haul it out and put America back to work? Why are we 
continuing to study these things ad nauseam?
    Ms. Wagner. I would not characterize the National 
Environmental Policy Act as simply studying the thing. It takes 
a look at the site-specific impacts of an activity, guides the 
decisionmaker to make a decision about that activity, and then 
we move forward after that decision has been informed. We have 
requirements under provisions of law to take a look at the 
cultural resources, to know what the wildlife impact and 
inventory and species are. We have the Endangered Species Act. 
It is complex, yes, but----
    Mr. Johnson. Well, I apologize for cutting you off because 
my time has expired, but I want to follow up just real quickly. 
We have private sources that are interested in paying some of 
this funding to get this analysis done. If the forest products 
industry in northeast Washington is willing to pay the Forest 
Service $600 to $750 per acre to treat the forest and remove 
the fuels, it seems to point back to the agency's planning 
cost, doesn't this reiterate the need to reduce the cost and 
complexity of completing never-ending costly NEPA analysis on 
projects that have already got broad private sector support?
    Mr. Bishop. You have 15 seconds to do that answer.
    Ms. Wagner. Absolutely, we want to make sure that we are 
using appropriate dollars very efficiently and that we are 
leveraging the strong agreement that exists in these 
collaborate landscapes. We need to speed up the NEPA process.
    Mr. Johnson. America wants to break down the bureaucratic 
roadblock and put it back to work. Thank you for the extra 
time, Mr. Chairman
    Mr. Bishop. And you did it in 14 seconds. I am impressed. 
Mr. Rivera.
    Mr. Rivera. Thank you, Mr. Chairman. With your permission, 
if I could yield my time to my colleague from Florida, Mr. 
Southerland?
    Mr. Bishop. Certainly. Mr. Southerland.
    Mr. Southerland. Thank you, Mr. Rivera, and thank you, Mr. 
Chairman.
    I wanted to ask because I do have a constituent here. Mrs. 
Dauzat, I would like to ask you some questions because you are 
out there having to live with this insanity, OK, and most 
people who have walking-around sense really struggle with what 
we hear here in this book and environment that we live in. But 
since you are sweating payroll, since you are paying high 
workers comp. premiums, since you are dealing with the lunacy 
coming out of the EPA, OK, they want to study something, they 
want to diagnose something. Well, after it is dead, then it 
becomes a postmortem examination. So what I want to do is ask 
you a couple of things.
    You are obviously an owner of multiple businesses, and over 
400 jobs that we talked about earlier amongst your communities. 
As a Floridian, it is worth noting that Florida's forest 
product industry contributes over $16.6 billion to the State's 
economy. As an industry expert, do you believe lumber 
production in the country would benefit from increased access 
to timber in our national forests as far as jobs? I know that 
is simple.
    Ms. Dauzat. Definitely. Go ahead.
    Mr. Southerland. Go ahead. No, you drove a long way.
    Ms. Dauzat. I mean, our mill in Bristol, having access to 
the Apalachicola and national forests would be a tremendous 
increase in resources. We are able to make it as we are, but 
having that access would be wonderful for the community, 
wonderful for our company.
    Mr. Southerland. And as far as the Apalachicola National 
Forest, it is my understanding having been there, having grown 
up there, that what the Service has done, conveniently, is take 
a national forest and have created wilderness land. So, they 
have basically taken a national forest and made a national 
park, which obviously has had terrible effects on the ability 
to harvest. Also, in the national forest, it needs to be noted 
it has a 5.7 mortality rate, and we have a 3.5 percent harvest 
rate.
    So why in the world, and I guess we could shift over to Ms. 
Wagner, why in the world with those numbers--5.7 mortality 
rate, 3.5 cut rate--how do we get our arms around that and say 
this is smart?
    Ms. Wagner. We are not harvesting all of the in-growth that 
occurs on national forests across the nation. We are not even 
touching it, approximating it, coming close to it in part 
because people value forests for a suite of values that they 
get from them. In other cases we are actively working and 
harvesting commercially, and in addition, providing small 
diameter material that is fostered by our restoration work.
    Mr. Southerland. But we are harvesting now 20 to 30 percent 
of what we were harvesting 10 years ago, and yet we have an 
Administration, if they utilize, you know, the numbers that you 
shared, the $320 million Mr. DeFazio asked you about, and you 
want to work with us, so you throw out a number, and now you 
want to work with us. If that is the rationale that this 
Administration has for the entire budget, that is pretty scary.
    OK, in small business we figure out how we are going to do 
something and then we determine the possibility of numbers. So 
explain to me how going from where we were 10 years ago, and 
the things that Mr. Walden talked about, we had 405 mills 30 
years ago and now we are down to 106, and much of that is 
because of the management of the services. How do you justify 
that this particular direction that you are headed is good from 
American jobs? This is a jobs issue.
    Ms. Wagner. We favor working and restoring America's 
forests.
    Mr. Southerland. I don't think you do favor working though, 
and see, I have to counter what you--you do favor restoring 
forests just like some favor turning the Gulf of Mexico into an 
aquarium, OK? And I think that you do, I think you do mean what 
you just said as far as restoration and as far as preservation, 
but these numbers say that you don't value work and jobs in 
these rural counties.
    Ms. Wagner. Well, I would like to provide the Committee 
with the real number of acres treated, volume created and give 
you a sense of the--for the investment what we are getting off 
of national forests, so I would like to provide that to the 
Committee.
    Mr. Southerland. That would be good.
    Ms. Wagner. And just reiterate that the creation of 
resilient and healthy forests is something that has been 
priority for the Forest Service for a number of years. We work 
in a complicated regulatory environment and a patchwork of laws 
that makes it a little difficult to navigate that landscape, 
but we are committed to do so for the health of the land and to 
provide benefits to citizens in this country.
    Mr. Bishop. OK, thank you. Mr. Labrador.
    Mr. Labrador. Thank you, Mr. Chairman.
    We need to be innovative in the way that we are dealing 
with this issue. We have some county commissioners in Idaho who 
are working toward a new solution that is kind of outside the 
box, kind of what you are working on, Mr. Vaagen, so to speak, 
and I am still hearing from them. I am going to be working with 
them in the next few months trying to see if it is an idea we 
can bring to Congress, but we need more ideas. The one idea by 
itself is not enough. I welcome the proposals that some of 
these counties are saying they are going to be submitting, Mr. 
Chairman, a letter to the record within the next 10 days, and 
this is just one option that we have that we need to take a 
hard look at and we need to just find a good solution to the 
problem.
    I am concerned about jobs, and maybe some of the questions 
that I heard, is it Mr. Vaagen or Vaagen?
    Mr. Vaagen. Vaagen.
    Mr. Labrador. Vaagen, all right. Mr. Vaagen, have you seen 
a drop in the demand for wood at this time?
    Mr. Vaagen. In some products but again 15 percent of our 
product finds its way to Australia, some to Japan. The foreign 
markets are very good right now.
    Mr. Labrador. Foreign markets are good and we also use wood 
for paper. Have you seen--I know you don't deal with this, but 
we have a paper mill in our----
    Mr. Vaagen. Yes, there are several around us. We have five 
customers. Pulp and paper is extremely good, probably the best 
it has been in the last 20 years for an extended period of 
time--almost a year-and-a-half, which is like a record. Because 
there is a constriction on the log supply, it is going to 
remain high. Wood pulp is extremely valuable, and a lot of the 
wood products in the U.S. are finding their way to China in the 
form of logs or lumber. So, no, there is still demand. We ran 
out of logs. We ran one mill 33 percent of the time, which is 
unfortunate. The other one was two-thirds. We would like to run 
them both at 100. We could add 100 jobs immediately. That would 
be another 100 jobs in the words and your district as well.
    Mr. Labrador. And that is what I am asking. So there are 
jobs that could be created. We can use some of this wood that 
is diseased, you know, with beetle. We could use that for paper 
products, right?
    Mr. Vaagen. Absolutely. That pulp logs, and that is another 
business. Half of our fiber makes it in byproducts, chips, sod, 
bark and shavings, so that is another thing about small logs, 
but that is a third of our revenues, too, so we don't take that 
lightly.
    Mr. Labrador. OK. Now no one on this panel is arguing that 
timber harvesting is the only valuable use of the lands, right? 
Is there anybody on this panel who is arguing that?
    Mr. Vaagen. Well, I would argue if you don't do it you are 
going to get fire, and that is going to destroy the habitat and 
these other uses that people like to use. You don't destroy 
500,000 acres without destroying habitat, animals and 
recreation, grazing, you name it.
    Mr. Labrador. Well, you got to my next question. The reason 
we want timber harvesting is we want to prevent some of these 
large forest fires, so in north Idaho we had 100 years ago a 
huge fire that almost destroyed the entire area, and they are 
concerned in Idaho that we may have that again, you know, 
called the 100-year fire, that we are getting to a point where 
the timber has grown and the forestation has grown at such a 
rate that we could have another fire like that. What is the 
best way to prevent something like that from happening?
    Mr. Vaagen. You have to take the material out. You have to 
thin the forest, and trees are valuable. I like trees, and we 
don't cut them all, and they grow. It is amazing. We act like 
they don't grow back. They do. Those fires you are talking 
about in 1910, three million acres, it all grew back.
    Mr. Labrador. Yes.
    Mr. Vaagen. So we need to take the fuel loadings out and we 
need to do that quickly, and if you want to make money on it go 
to the places where they can make money on it first, break even 
second, and if it cost you money you go there third.
    Mr. Labrador. Now you have been working on these 
communities for over two decades. In your experience in the 
Colville National Forest what kind of changes have you seen in 
the structure and overall health of the forest?
    Mr. Vaagen. Well, what we have harvested, and actually I 
have to tell you it is over four and a half decades actually.
    Mr. Labrador. OK. My apologies.
    Mr. Vaagen. No, no, I am trying to stay in good health. It 
has gotten better where we treat it, and it is fire resilient. 
Where we haven't treated the fuel loadings are high. We have 
mountain pine beetle now. I am afraid for Idaho, Montana, and 
Washington State inland, we are going to have some big fires in 
the next 10 years, amazing fires.
    Mr. Labrador. And one last question. What are your thoughts 
about the socioeconomic impacts? What have you seen about the 
socioeconomic impacts in those decades as well based on our 
forest policy?
    Mr. Vaagen. Well, we used to cut the bigger trees up to 
four-foot diameter. In Republic and Ione, we lost those two 
operations. That was probably 300 jobs in the mills, 300 in 
those small communities. Those school districts have gotten 
smaller. I was in Ione last week, a small town in northeast 
Washington. Half the stores look like they are boarded up. They 
always wait for a mine or some other project that lasts for 20 
years as a boost but long term the forest is where we live. 
That is where we get the value, and we can increase it, and we 
haven't done those areas any good the last 20 years.
    Mr. Labrador. Thank you very much
    Mr. Bishop. OK, thank you.
    Mr. Vaagen, it is obvious that Mr. Labrador doesn't need 
your book, so can I get his copy?
    Mr. Vaagen. Is it in the bag, sir
    Mr. Bishop. OK, good. Mr. Young is a member of our 
Subcommittee with impeccable timing. Do you have some questions 
for these witnesses?
    Mr. Young. Mostly a comment. This hearing is about Secure 
Rural Schools and Communities. I notice Ms. Wagner said she 
supports the reauthorization, but gives us no suggestions on 
funding. Funding would be to harvest some trees. That is the 
answer. I know in Alaska, you know, 35 years ago we were--
actually 40 years ago--we were cutting 450 million board feet a 
year, and now if I am not mistaken, Ms. Wagner, we are supposed 
to have 267 million board feet this year, and we have 15 
million board feet.
    When I drove by that Forest Service compound--you are good 
at building compounds, by the way--if you want to fund these 
schools, eradicate the compounds, sell them, use the money and 
fund these schools. When I was in Ketchikan the other day and, 
gentlemen, I want you to listen to this, I drove by their 
compound--by the way it is gated. There are 27 new Chevrolet 
trucks in the yard. There are 3 big boats with 2 motors each--
150 horsepower--brand new in the yard, and what kills me, 27 
kayaks--kayaks. And I asked what they were for. They use them 
so they don't disturb the forest, and this is the Forest 
Service that is supposed to be harvesting trees so we have 
secure schools.
    With all due respect, Ms. Wagner, you are not the only--
this Administration is not the only one. This has been going on 
for a long time, answering to interest groups that say we have 
to save our trees, and what they are doing is saving the dead 
ones and not allowing the young ones to grow.
    Now, can you visualize, everybody in this room, while you 
allowed to grow and live forever, being rotten to the core, and 
that young girl in the back of the room back there wouldn't 
have room to grow. The forests of this nation is a vital part 
of what we call our fiber base, and we have neglected it and 
let it burn. Now, I agree with my good friend that said there 
are going to be big forest fires, and it is going to happen, 
but you will say, and EPA will say, and the interest groups, 
``Oh, that is natural,'' and I am very upset about that for 
another reason.
    We have the EPA and forests and air quality in Fairbanks, 
Alaska, but they will let the forests burn because it is 
natural, but when it is 60 below zero you can't light a fire 
because you might pollute the air to keep warm. Now that is the 
stupidity of our Federal Government. Now show me the rationale 
behind that.
    So I am suggesting, Mr. Chairman, and I know I am on my 
soapbox but I am suggesting that we need to solve this problem, 
have to re-address this idea of what is the forest for. For 
those who live in the--I call the big cities that go around and 
visit, oh, they are really pretty, and leave these people in 
the rural areas to starve, have to move, destroy the fiber of 
this country. Your counties are going through it right now. But 
the solution is with the Forest Service to say we are the 
managing agency and we are going to harvest these trees as we 
should.
    With all due respect, I don't see this in the Forest 
Service anymore. I see park rangers, that is what I see. I 
don't see people that believe that the trees can grow again. So 
I think it is very, very important, my good Chairman and the 
Members of this Committee, either they do it or we pass laws 
that says they will. Take it away from the Forest Service, give 
it to the counties. You manage it. You live there. You live it. 
Provide for your people because our government right now is 
forcing people from these small communities and move to the big 
cities, and we don't have a timber industry.
    Ms. Wagner, why aren't we cutting trees? And don't give me 
this restoration stuff, by the way. We are restoring it for 
what? If you are not going to cut it, you are not restoring it.
    Ms. Wagner. I think the way I could best address your 
statement is in citing the 10 projects that are real projects, 
tangible, on-the-ground, generating outcomes, including forest 
products harvested. These are the 10 Collaborative Forest 
Landscape Restoration Act projects. Congress say the need to 
invest in large landscape scale restoration which is not simply 
conservation and protection. It is actually utilization and 
treatment of these projects. All of these projects are over 
50,000 acres in scale. Many of them over a million acres in 
scale where citizens have come together and they are 
identifying what needs to be done--the treatment of invasive 
species, the restoration of streams or creeks, the wildlife 
habitat that needs to be improved, the hazardous fuels that 
need reduced, and the wood products that need harvested and 
moved to put that forest in a condition where it can be 
resilient to the impacts and changes that we are predicting 
over time including fire.
    So, I would like to provide you with a list of these 
projects and the outcomes that have happened just in one year's 
worth of funding as examples of how active we are and how 
committed we are to the condition and health of these forests.
    Mr. Bishop. Thank you very much. I hope, Mr. Young, now I 
am 60, I am not one of those old trees that is rotten to the 
core you are talking about.
    Mr. Young. It takes 100 years.
    [Laughter.]
    Mr. Young. By that time you better be harvested, I can tell 
you that right now.
    [Laughter.]
    Mr. Bishop. Ms. McMorris Rodgers.
    Mrs. McMorris Rodgers. Thank you, Mr. Chairman. Mr. Young 
was asking what are the forests for, and he made the comment 
that for some they are really pretty. You know, I might submit 
that they are not even really pretty. If Americans saw what was 
really going on in these forests, I think they would be 
outraged because the Forest Service, yes, they own, they manage 
millions of acres, that is what they say, but the reality is if 
you look at these trees, so many are dying. They are dead, they 
are kindling actually for that major fire. This year's New 
Mexico, you know, next year who is it going to be? Or even 
later on this year who is it going to be? That is the reality. 
I wish more people could actually see, I wish Americans could 
see what is going on in these forests. They would be outraged.
    And I come from the Colville National Forest, and it is the 
model supposedly of how we on the local level should be working 
together, coming together in this collaborative approach. We 
have done it now for years and years, and then we still, we 
still don't qualify for the Collaborative Forest Landscape 
Restoration Fund. Ten projects in all of America. It is very 
disappointing.
    I wanted to ask, Mary, and I appreciate the conversations 
we have had through the years, do you believe that the Forest 
Service--that the time, the cost required to plan, analyze is 
too high?
    Ms. Wagner. We are working on that as we speak because we 
believe that to do our best by the people that put us out there 
to do work on forests we have to stretch the appropriated 
dollar in every way that it can. So this NEPA project that I 
mentioned to look at categorical exclusions, to support 
restoration work, and to look at demonstration projects where 
we can practice better approaches to NEPA, streamline, move 
faster, work cheaper is absolutely critical for us.
    Mrs. McMorris Rodgers. I feel like we have tried 
everything. We have jumped through all the hoops and there is 
always just one more. I would like to ask Mr. Vaagen, why don't 
you think that we qualified or what is your experience? Let me 
ask you. What is your experience related to the Collaborative 
Forest Landscape Restoration Fund?
    Mr. Vaagen. I was a big proponent of it. I was excited 
about it. I thought that we would qualify. I thought that we 
were number one or two in the Nation out of 10. We didn't make 
the top 15, which tells me the collaboration wasn't a good 
payoff for us. We haven't got special funding there and our 
forest has the bug. A third of the national forests is at risk 
of fire. You know, 60 million acres out of 193 million, that is 
a high percentage. My experience is we are not getting it done. 
Something drastically has to change. There has to be a new way 
of doing business.
    We stand ready to help and pay the government and extra $12 
million a year, and probably provide additional 350 jobs. It is 
all a win/win/win situation. I don't think people can answer 
the question why today because they don't want to answer the 
question. I will answer the question.
    Mrs. McMorris Rodgers. So now we are in the situation where 
we are actually willing to pay the Forest Service for an 
opportunity to maybe get some of these sales. What has been the 
response so far from the Forest Service?
    Mr. Vaagen. What do you mean by pay to get----
    Mrs. McMorris Rodgers. Well, that we would--that the forest 
products industry will now potentially pay to treat certain 
parts of the forest.
    Mr. Vaagen. Well, from our vantage point we are going to 
pay for anything we treat, but you have to lower the cost to 
make it affordable for the government. Their costs are too high 
and don't try to make the sale uneconomical. Our experience is 
they put in special walkway bridges, things like that, 
bathrooms, whatever, but also they make the sales itself very 
difficult. You need to target jobs and profitability if you are 
going to make it a success and you have to work with customers 
and markets to do that.
    Mrs. McMorris Rodgers. Thank you. Mr. Pearce, what do you 
believe is the impact of stewardship contracts on counties and 
schools through Secure Rural Schools?
    Mr. Pearce. Thank you very much.
    The Forest Service has adopted stewardship contracting as a 
panacea for dismal timber production. Stewardship contracting 
requires a collaborative process. These collaborators are 
intended to have participation by people on all sides of the 
issues. On the north half of our forest, the Gifford Pinchot 
National Forest, in the district the collaborators took 10 
years to produce a single 11 million board foot sale. Ten 
years, 11 million board feet.
    A forest executive told me that based on this collaboration 
the new timber rotation in the Gifford Pinchot is 300 years. 
This is a forest that produced an average of 350 million board 
feet from the seventies until 1991. Even the Northwest Forest 
Plan calls for 50 million board feet per year. No revenue is 
produced for the county schools or treasuries from these sales. 
Instead the forest line officers negotiate for restoration or 
other work in exchange for actual dollars.
    I am aware of at least two contracts where the Forest ended 
up owing the successful bidder some money at the end. The so-
called collaborative process of decision by committee of those 
that can commit untold volunteer hours against paid 
environmental staff is a poor way of doing business, and it is 
not very scientific.
    Mr. Bishop. Thank you. I appreciate that. Mr. Herger.
    Mr. Herger. Thank you, Chairman Bishop, for holding this 
hearing and allowing me to participate. The Northern California 
district that I represent contains all or parts of nine 
national forests. Sadly, many Northern California communities 
have been devastated by the forced decline of the timber 
industry. I was a strong supporter of the legislation in 2000 
that authorized the Secure Rural Schools Program. Congressman 
George Radanovich and I sat on the Budget Committee then and 
worked to help secure the program's funding. I said on the 
Floor at the time that ``It provides the short-term stability 
and education funding which these communities desperately need 
while enabling them to participate with their Federal agencies 
in a program that will help to begin to restore health to our 
overgrown national forest system.''
    This funding has been crucial for schools and roads in the 
communities I represent, but it was intended to be a bridge and 
the program's goal should continue to be to foster forest 
management which is the best and really only way to restore 
long-term stability to our county economies and our schools.
    Today's hearing is an unfortunate reminder that timber 
harvests are still nowhere near where they need to be. Our 
forests and communities are becoming more and more vulnerable 
to catastrophic wild fires, and our forest counties face very 
high unemployment.
    Mr. Pearce, what efforts will your organization make to 
help ensure that the Secure Rural Schools Programs get back to 
its original goal of self-sufficiency for communities through 
increased timber harvesting?
    Mr. Pearce. As I said earlier, the National Forest counties 
Coalition and the Partnership for Rural America has put forward 
a White Paper which is included in my testimony, my written 
testimony, that speaks to forest management. We believe in 
forest management. We want to trade these safety net dollars 
for jobs for our communities because the jobs and the dollars 
in our communities are important, and the NACO position, 
National Association of Counties' position is also the same. We 
are ready to work with whoever we need to work with to get 
production back into the forest. It is not just about 
restoration. It is about actual timber production.
    Mr. Herger. Mr. Pearce, I want to thank you and your 
organization for that. I can't emphasize enough how important 
it is that this Congress be lobbied by the constituency, your 
constituency, to make sure this fact is out there. I hate to 
say that over the years, particularly over the last four or 
five years, I have seen a decrease in our counties and our 
different coalitions out lobbying our Congress for this point 
because ultimately we know what the funding is here. We know we 
are only spending 42 cents out of every dollar more than we are 
bringing in. Ultimately it is going to take us, and we have 
heard even during these economic down times of the housing 
being down, there is still a demand for our product out there, 
and the real answer, both to preventing these fires by going 
out and managing them, thinning out our forests and getting 
money into our school since it is not going to be there in our 
counties otherwise is by a very active lobbying by your group.
    Ms. Wagner, I recently received--on a different issue--a 
copy of these letters that were sent from the Forest Service 
Washington Office to Fish and Wildlife Service and National 
Marine Fishery Service revoking the alternative consultation 
agreement between our agencies. I have been very concerned with 
the delays in consultation for projects in my district, and 
this will only make that worse. My question to you is why did 
the Forest Service get rid of this valuable tool and how will 
the Forest Service increase forest management and 25 percent 
payments while implementing these kinds of decisions?
    Ms. Wagner. Sir, I don't know the answer to the alternative 
arrangements with Fish and Wildlife Service, so if you would 
allow me to check into that and get a response back to you, I 
would be happy to do that. Consultation is an important piece 
of our work, and I would like to explore that, so I will get 
back with you on that.
    Mr. Herger. Thank you. I appreciate that. Thank you, Mr. 
Chairman.
    Mr. Bishop. Thank you. Mr. Tipton.
    Mr. Tipton. Thank you, Mr. Chairman. I would like to thank 
our panel for being here.
    I came from the west slope of Colorado and we have up to 70 
percent of the property on the western slope of Colorado is 
either Federal, state or tribal lands, and Ms. Wagner, I guess 
I would like to ask you a question from the Forest Service 
perspective. I have an area called Chimney Rock, which you all 
may be familiar with, on Forest Service lands. I was visiting 
with some of the rangers and they indicated that the timber was 
literally overgrown. You are only supposed to have so many 
Ponderosa Pine, Blue Spruce over a given area, and that it was 
overgrown.
    So can you maybe illustrate for me, and I apologize, had to 
run out, you may have already covered this, what is the Forest 
Service plan truly for dealing with some of the overgrowth? 
Because when we are talking about Colorado, we live in fear, 
one lightening strike, one spark away from a major forest fire 
with the dead standing timber from the pine beetle kill, which 
we have had. We have to really manage our forests in a way that 
not only lends itself obviously to their good health but 
obviously the collateral benefits that we can see with our 
timber industry representatives here for providing jobs and for 
supporting our school. So, can you tell me a little bit of what 
those plans are?
    Ms. Wagner. So, there would be two approaches to treat a 
forest stand that is overgrown, that has unhealthful forest 
conditions in it. Usually we do a combination. We take our 
NFTM, our timber management budget line item and our hazardous 
fuels reduction budget line item, and we combine those to do 
the project planning, put a silvicultural prescription in 
place, do the environmental documentation, issue a decision, 
put a timber sale contractor or stewardship contract on the 
streets, and actively manage that.
    Mr. Tipton. Are you seeing some regulatory concerns that 
are inhibiting you from being able to do that job?
    Ms. Wagner. Well, I think I mentioned a few things. We have 
to get better at our own environmental documentation through 
the National Environmental Policy Act, so I have talked about 
that being something that is on us to get better at doing. We 
need to continue to work on how we take the appropriated dollar 
and really stretch it to do everything that is necessary. We 
would be the first to say that we are not treating all the 
acres that are needed treatment on national forests.
    Mr. Tipton. Great. How about access into the forests 
because we have a lot of plans right now shutting down a lot of 
roads going into our forests, how is that going to impact the 
timber industry's ability to be able to get in and make those 
treatments?
    Ms. Wagner. One thing I wanted to mention earlier about the 
forest products industry. They have, in the West, the AFRC, 
they do a lot of work with us locally on the ground looking at 
the specific timber sale projects that we are proposing to put 
up, and they help us make sure that we are packaging them in 
the most economical way. They advise us. We sometimes take road 
packages out of them to make them more viable, particularly in 
this downturned economy, so I do want to credit industry works 
directly with us to put the most favorable packages together. I 
think that is why in part our offerings have had a high rate of 
sell.
    I forgot the second part of your question. I am sorry.
    Mr. Tipton. Well, let me move on to another point here. We 
have one mill left in Colorado, and it is in receivership right 
now, you know. And I think when Congressman Walden was talking 
about the number of mills that we used to have available in 
this country, is there a real commitment now for the Forest 
Service, because a lot of it has to be cost-associated ability 
to get that timber out? Right now we have to create that 
accessibility, and I would encourage you to do everything you 
possibly can to assist us.
    Ms. Wagner. Thank you. In these economic times the Forest 
Service has had a pretty aggressive approach to addressing all 
of the avenues that we have in regulation and through the Farm 
Bill to make projects more viable. We have been able to extend 
contracts, in some cases cancel contracts or reduce prices on 
contracts to make them more viable in these conditions.
    Mr. Tipton. Ms. Dauzat, fourth generation, I assume you 
want to go into the fifth generation to be able to do this. 
What can the Forest Service do to help you?
    Ms. Dauzat. Well, we own timberland as well, and from what 
she has described if we had to sell our timber in the manner 
they have to sell our timber it would never work. I mean, you 
have to make it logical. We go out as sawmill owners, we have a 
forestry department, they go out, approach landowners, the deal 
is made, the timber is cut. It doesn't cost us money. Everybody 
makes money in the equation, so I am confused.
    Mr. Tipton. My time has expired, Mr. Chairman. Thank you.
    Mr. Bishop. Thank you. Let me ask a couple of questions to 
a few of you.
    Mr. Pearce, first of all, you quote the NACO platform that 
says it supports active natural resource management. Does that 
mean that NACO supports streamlining NEPA or other laws as well 
to provide protection from activists who use those laws to 
delay and obstruct the active forest management?
    Mr. Pearce. Yes, sir. We support both reform of NEPA as 
well as the ESA.
    Mr. Bishop. What about your county and also the Partnership 
for Rural America? You represent both of them.
    Mr. Pearce. National Forest Counties and the Partnership 
both do, and especially the use of categorical exclusion.
    Mr. Bishop. I appreciate that so let me follow up with Ms. 
Wagner then on that issue.
    The NEPA analysis can cost up to $1 million per project to 
go through that. Does the Forest Service agree that the time 
and cost required to plan and analyze forest management is too 
high?
    Ms. Wagner. We want to work to lower those costs so that we 
can do more work on the ground
    Mr. Bishop. Do you think it is actually possible for the 
Forest Service to begin producing revenues for schools and 
local government if it does not streamline that process?
    Ms. Wagner. I think it would be very difficult for us to 
achieve the receipts necessary to fully pay the freight
    Mr. Bishop. Ms. Wagner, the proposed planning rule has some 
concern. Probably every multiple-use organization in the 
country and several Members of Congress who represent probably 
most, if not 80 percent of the national forest, have expressed 
concern with that. A letter was sent to Secretary Vilsack back 
on May 31 of this year. To date, we have yet to receive any 
kind of response from either the Service or the Department.
    Do you have a clue like when we are going to be hearing 
from him?
    Ms. Wagner. Mr. Bishop, let me follow up on that. I know we 
have received the letter and let me make sure that we have 
actually got a response, and if your office doesn't have it 
make sure you do.
    Mr. Bishop. Thank you. Mr. Vaagen, you know, assuming we 
can produce meaningful progress with the Forest Service in your 
area, how quickly do you think your coalitions, the management 
approach for the Colville National Forest can produce the 25 
percent payments you referred to in your testimony?
    Mr. Vaagen. Fairly quickly. We just have to have more 
projects put up to get the revenue stream up
    Mr. Bishop. Is there a time lapse in that or is it simply a 
matter of authorizing the work to go forward?
    Mr. Vaagen. Authorizing the work to go forward. CEs would 
work like on this mountain pine beetle, they can go up to a 
thousand acres. I see various projects being implemented 
immediately. I mean, the material is turning orange and yellow, 
and then gray, and then the last color will be orange again.
    Mr. Bishop. I thought blue was in there somewhere.
    Mr. Vaagen. Yes, it is if it is real hot. Yes, you are 
right.
    Mr. Bishop. All right. Could I also ask you the other 
question? What do you believe would be the effect if Congress 
was to reauthorize Secure Rural Schools Program without making 
reforms to how the Forest Service manages those lands to bring 
a sustainable management back to the forest?
    Mr. Vaagen. I don't see how that would happen. It hasn't 
happened in the past.
    Mr. Bishop. Let me ask one last question for Ms. Wagner if 
I could. The Interior Department recently released a new 
spotted owl recovery plan that in some of our opinions remains 
largely unchanged from the plan that was released last fall. 
How can the Forest Service increase management, especially in 
the Northwest, if this new recovery plan and the ensuing 
critical habitat designation places more restrictions on more 
acres?
    Ms. Wagner. I mean, I do this from memory, sir, so if I 
don't have it right I would like to make sure that I can follow 
up with the correct information. But I think the estimates from 
the Pacific North region about the impact of the northern 
spotted owl recovery plan is that it would impact the number of 
acres treated by somewhere between 15 and 20 percent in the 
Pacific Northwest, so it would lessen our ability in some ways 
to treat acres.
    It is a fine line trying to recover species and balance the 
habitat requirements for that species in light of other 
competition, the Bart owl, in particular, so that is a complex 
problem. I know it does have some impacts. I know the Forest 
Service was feeling like the impacts and the Fish and Wildlife 
Service had been responsive to the comments that had been 
offered and the workshops that were in place early this winter 
to resolve those concerns
    Mr. Bishop. OK, thank you. It is a good answer, complete 
answer to my question. Appreciate that.
    Are there others on the Committee who would like a second 
round of questions? Mr. Southerland, do you have--
    Mr. Southerland. It shouldn't take much time
    Mr. Bishop. You are recognized.
    Mr. Southerland. Thank you, Mr. Chairman.
    I wanted to ask Ms. Dauzat if I could, as a business owner, 
because right now small business in this country is being 
crushed by what I believe are manmade policies. With small 
business representing 85 percent of our economy, and the State 
of Florida is having historical unemployment numbers, 
nationwide we are seeing the unemployment rate continue to go 
up. Florida has been hit, as you know, by incredible amounts of 
foreclosures. But as a business owner and you knowing what I 
just stated, you and your family have contributed much to our 
communities in north and northwest Florida, do you have any 
suggestions for this committee on how to better manage national 
forests while preserving our wildlife habitat for future 
generations?
    And I notice you, by the way, have your daughter here, so 
witnessing mom testifying, so when I say future generations it 
sits 10 feet from you.
    Ms. Dauzat. She is present, yes.
    My written comments that I submitted contained a number of 
specific recommendations. I would ask the Committee to consider 
them. Beyond them I ask each of you to remember that you are 
not just dealing with land, timber and other natural resources. 
You have in your hand many communities and families' legacies 
that deserves to be properly cared by everyone here. You are 
not dealing with dollars for counties, you are dealing with 
families, especially children, and with their homes, their 
dreams, their future. Please treat them gently.
    Mr. Southerland. Wonderful. Thank you very much. Mr. 
Chairman, I want to say this is not a committee assignment. I 
would like to thank you publicly for allowing me to come before 
you today. Thank you
    Mr. Bishop. We are happy to have you here. Come anytime, 
and starting the next session we will renegotiate, maybe we can 
get you hear full time.
    Mr. McClintock, do you have another couple of questions in 
conclusion?
    Mr. McClintock. Yes, sir. Thank you, Mr. Chairman.
    Ms. Dauzat, you actually are in the harvesting business as 
well as sawmill business, right?
    Ms. Dauzat. Well, we do not own logging operations but we 
have a procurement company that goes out and procures timber 
for our sawmill.
    Mr. McClintock. Do any of you actually have timber stands 
that you manage?
    Ms. Dauzat. Yes, we own lumber as well.
    Mr. McClintock. Can you tell me on the timber stands that 
you own what is the commercial value of those stands?
    Ms. Dauzat. Not off the top of my head.
    Mr. McClintock. What percentage of your stands do you 
harvest every year?
    Ms. Dauzat. We own about 9,000 acres as a family and we try 
to keep it at about 150 acres a year rotation. That is what we 
shoot for.
    Mr. McClintock. Out of how much?
    Ms. Dauzat. Nine thousand acres.
    Mr. McClintock. OK.
    Ms. Dauzat. Small stand.
    Mr. McClintock. So percentage-wise that is what, about one 
or two percent?
    Ms. Dauzat. Yes.
    Mr. McClintock. OK. Mr. Vaagen, you seem to have----
    Mr. Vaagen. Same story. We have about 50,000 acres. It is 
less than five percent of our supply, but we try to continually 
rotate it, stay ahead of the bugs, the forest health issues. 
The value of it is usually $1,000 to $2,000 an acre.
    Mr. McClintock. One thousand to two thousand an acre. That 
is helpful.
    Ms. Wagner, what percentage of our timber does the Federal 
Government harvest? Ms. Wagner?
    Ms. Wagner. I am sorry, sir. I was just looking to see if I 
had a quick acre figure. I have a volume figure and I have some 
acre figures, but I would like to get back with you on--oh, 
wait, timber sales, 177,000 acres treated using timber sales in 
2010.
    Mr. McClintock. Now, is that the percentage of our timber 
resources that we are harvesting each year?
    Ms. Wagner. No, sir. We would be happy to do that because I 
think it would be worth looking at the different legislation 
that exists on national forests and take things like wilderness 
areas out of calculation, but about 200,000 acres treated using 
timber sales out of the acres that we--a very modest 
percentage.
    Mr. McClintock. What I am getting at is this is a renewable 
resource of immense value. Using the low end figure that Mr. 
Vaagen just offered us, I would assume that means that the 
total value of our national forest timber is some $200 billion, 
meaning if we harvested one percent a year that would be 
yielding at least $2 billion of revenues to the United States 
Treasury.
    And the point that Mr. Young made is one that needs to be 
emphasized. If we were actually properly managing these 
resources, not only would we have healthier forests, we would 
have a much healthier economy because the economic multiplier 
on forest activity that I have seen from economists is about 
threefold. So, not only would it be $2 billion of direct 
revenues to the Federal treasury, it would be $6 billion of 
additional economic activity because of the ripple effect of 
that economic productivity.
    Mr. Young says we could fund our Secure Rural Schools 
budget from that. In fact, we wouldn't need Secure Rural 
Schools because the local communities would be generating 
enormous property taxes again because of an enormous prosperity 
that I see this policy practiced by your bureaucracy standing 
in the way of. I mean, I look at the economic devastation of my 
district, which is one of the most resource rich areas of the 
country, northeastern California, huge, huge timber resources 
mainly managed by the Federal Government sitting there. They 
can't even harvest fire killed timber once the overgrowth has 
caused these fires. We can't even go back in and salvage dead 
timber because of the restrictions placed in the way by the 
Forest Service and by this panoply of environmental laws that 
need wholesale redress.
    So, Mr. Chairman, I would just like to offer the suggestion 
that maybe in the future we ought to be looking at ways that we 
can link the Forest Service budget to Forest Service revenues 
actually yielded off of Forest Service land.
    Mr. Bishop. Thank you. Mr. Tipton.
    Mr. Tipton. Thank you, Mr. Chairman, and I just wanted to 
have one follow-up question.
    Mr. Pearce, I would like to go back to some of the opening 
comments Congressman Walden brought up just to have your 
feedback.
    Would you and other leaders in counties that are similar to 
yours, would you like to see additional discretion from your 
counties on how to manage your lands for production and provide 
revenue for rural schools?
    Mr. Pearce. Absolutely. You wouldn't get a negative, I 
think, from any of the counties that have, as I have said, up 
to 90 percent of their county in Federal ownership. And to 
really follow up to that, we also have state trust land, 20,000 
some odd acres, and have about 30,000 acres of private timber 
land. The fact is the state trust land brings more revenue 
comparatively on that 20,000 acres than the 880,000 acres of 
national forest I have.
    Mr. Tipton. Impressive and speaks to a lot. Thank you, Mr. 
Chairman. Thank you, Mr. Pearce
    Mr. Bishop. Thank you. I appreciate all four of you for 
your patience in answering these questions and how I 
slaughtered your names. I apologize for that, too. You are 
dismissed. We appreciate your time and effort in being here.
    We have one other panel, if we could have the following 
three people come to the table and join us: Mr. David Tenney, 
President of the County Supervisors Association of Arizona from 
the Navajo County Board of Supervisors; Ms. Anna Morrison, 
Women in Timber; Mr. David Crews, Superintendent of the Norwood 
Colorado School District.
    As you are coming up here, I would also ask unanimous 
consent that the SRS language from the Interior Appropriation 
Report in the House appear in our record. Hearing no objection, 
that is so ordered.
    [NOTE: The Interior Appropriation Report language has been 
retained in the Committee's official files.]
    Mr. Bishop. We appreciate the three of you joining us as 
well. The same situation applies as before. Your written 
testimonies will appear in the record. We are asking for your 
oral testimonies. As I think you were watching the clocks 
there, green means your time has started; yellow, you have a 
minute left; red, your time has actually expired, and we will 
see how long over that red mark we can all go.
    At any rate, we thank you for being here and we would ask 
Mr. Tenney if you would start us off with your oral testimony.

   STATEMENT OF DAVID TENNEY, PRESIDENT, COUNTY SUPERVISORS 
   ASSOCIATION OF ARIZONA, NAVAJO COUNTY BOARD OF SUPERVISORS

    Mr. Tenney. Thank you, Mr. Chairman, Members of the 
Committee. I appreciate the invitation to be here today.
    My name is David Tenney. I am Supervisor for Navajo County 
in the State of Arizona. I am located up in the northeastern 
part of Arizona. Also, just coincidentally I have nine years 
experience on a local school board there, so Secure Rural 
Schools I can come at it from a couple of different angles.
    I will begin by stating that I believe the responsible use 
of industry is the key ingredient for managing our forests. I 
also believe that the reintroduction of industry into our 
forests is the key ingredient for the continuation and 
reauthorization of county payment programs like PILT and Secure 
Rural Schools. I cannot overstate how important the management 
of natural resources have become to rural communities like 
ours, and rural counties like ours. The 468,000-acre Rodeo-
Chediski fire of 2002 burned in my county and nearly destroyed 
my home, and the 540,000-acre Wallow fire of this year burned 
in two of my neighboring counties.
    The footprints left by those two fires alone could 
comfortably hold the Cities of Phoenix, Chicago, Dallas and Los 
Angeles.
    Mr. Chairman and Members, the rural communities of Arizona 
were founded and exist due to the use of the abundant natural 
resources that surround them. However, our combined mistakes in 
forest management have changed rural counties like mine and we 
require the help and leadership of this body to correct the 
systemic mismanagement of our forests.
    During my adult life there has been a significant reduction 
in the harvesting of timber from the forests. In the late 
1980s, Arizona and New Mexico produced approximately 200 to 250 
million board feet of timber each year. Between 1989 and 1996, 
those numbers steadily dropped until there was no industry left 
in those forests, in 1997 and 1998.
    Dramatic reduction of wood harvesting was a result of 
intense disagreements over how the forests should be managed. 
During that period there was no effort by industry, government 
or the environmental community to find common ground, and as a 
result nothing productive took place. We lost our industries, 
we lost the revenues and jobs that came from those industries, 
and now we have lost millions of acres in our forests.
    You have heard testimony today that talks about what then 
happened and how Secure Rural Schools was put in place to 
replace some of those revenues. I won't go into that much 
because you know that history. But unfortunately we can't go 
back and prevent the mistakes that have degraded our forests 
and the funding sources that counties and schools need. There 
is plenty of anger and frustration to go around.
    My family was intimately involved in the timber wars of the 
eighties and nineties, and I will admit that I would not have 
probably sat in the same room as some of these environmental 
activists who opposed our family at that time. However, when I 
became first-hand witness to the massive fires that now burn in 
our country I saw their potential to destroy entire 
communities, and I embraced the challenge to change the 
situation.
    I am here to testify that each of these events, number one, 
the loss of the timber industry and the jobs that came with it, 
two, the decline of the timber receipts, the subsequent passage 
of Secure Rural Schools, and three, the destruction of homes 
and prize recreational areas in my county, a result of the 
degrading condition of the forests throughout America.
    Fortunately, there is a solution. The solution requires 
getting industry back into the forest to thin the trees in 
ecologically and socially sustainable way. The solution 
involves stakeholders from the scientific, environmental, 
elected, Forest Service, and industrial communities who are all 
at the table and who all agree that we must reach common 
ground.
    One of the solutions in our areas is what we call the 
Forest Service Restoration Initiative, or 4FRI. It is a model 
for the kind of management that will end the catastrophic wild 
fires and produce revenues for programs like PILT and Secure 
Rural Schools. The model we have developed calls for the 
Federal Government to partner with private industry to thin 
upwards of 50,000 acres of forested land in Arizona per year 
for little or no cost to the government. This model has been--
we have been working actively for the last three or four years 
to get this off the ground.
    We should do everything we can to revitalize our forests 
and to do so we need to support projects like 4FRI, other 
projects like it that come together collaboratively on a 
landscape scale to get industry back into the picture here, and 
in doing such thin our forests.
    I will give you one example of the kind of issues that we 
have. Coconino County where Congressmen Gosar, my congressman, 
lives, without Secure Rural Schools funding they would lose all 
of their search and rescue funding. In the small town of 
Fredonia there used to be a thriving forest community. They now 
have to bus their kindergartners and first graders over 30 
miles to go to school.
    We can remedy that though by putting industry back into the 
forest. It is going to take some time however. We are not going 
to do this overnight. I have heard questions asked today, could 
you immediately go back to funding and pay for itself. It can't 
happen overnight.
    I am out of time. I want to quickly give a couple of things 
that I think can make a difference, some asks that we have. I 
think we need to support the implementation of active forest 
management policy modeled after the Forest Restoration 
Initiative and others of its kind. We also need to support 
reforming things like NEPA and ESA. In the meantime, until we 
get that industry back into the forests we have to support the 
full funding of PILT and Secure Rural Schools and other 
programs such as those.
    Thank you, Mr. Chairman. I will stand for any questions.
    [The prepared statement of Mr. Tenney follows:]

   Statement of David Porter Tenney, Board of Supervisors Chairman, 
                         Navajo County, Arizona

    Mr. Chairman, and Committee members, thank you for the invitation 
to address you today. For the record, my name is David Porter Tenney, 
and I am a Supervisor in Navajo County, which is located in 
northeastern Arizona. I have nine years of experience as a former 
Chairman of the Show Low School Board, I am a member of the Four Forest 
Restoration Initiative Steering Committee, and I am currently the 
President of the County Supervisors Association of Arizona, which 
represents the 55 elected county supervisors in Arizona. It is in my 
capacity as a County Supervisor, and a member of the Four Forest 
Restoration Initiative, that I address you today on the importance of 
industry in forest management, and the need for the continued funding 
of PILT and the reauthorization of Secure Rural Schools and Community 
Self-Determination Act.
    I will begin by stating that I believe the responsible use of 
forest products industry is the key ingredient for managing our 
forests. I also believe that the reintroduction of forest products 
industry to our forests is a key ingredient for the continuation and 
reauthorization of county payment programs like PILT and the Secure 
Rural Schools Act.
    I cannot overstate how important the management of our forests has 
become to rural counties. The 468 thousand-acre Rodeo-Chediski Fire of 
2002 burned in my county, and nearly destroyed my home. The 538 
thousand-acre Wallow Fire of this year burned in two of my neighboring 
counties. The footprints left by these two fires could comfortably hold 
the cities of Phoenix, Chicago, Dallas and Los Angeles and the 
ecological and economic impacts are tremendous.
    Mr. Chairman, and Committee members, the rural communities of 
Arizona were founded on, and exist due to, the use of the abundant 
natural resources that surrounded them. However, our combined mistakes 
in forest management have changed rural counties like mine, and we 
require the help and leadership of this body to correct the systemic 
mismanagement of our forests.
    During my adult life, there has been a significant reduction in the 
harvesting of timber from the forests. In the late 1980's Arizona and 
New Mexico produced approximately 200 to 250 million board feet of 
timber each year. Between 1989 and 1996 those numbers steadily dropped 
until there was no forest products industry left in those forests by 
1998. The dramatic reduction in wood harvesting was a result of intense 
disagreements over how the forests should be managed. During that 
period, there was no effort by industry, government or the 
environmental community to find common ground, and as a result, nothing 
productive took place. We lost our industries, we lost the revenues and 
jobs that came from those industries, and we have now lost millions of 
acres in our forests.
    As you are aware, counties and schools have received a 25 percent 
share of timber receipts from the federal government since the 
administration Teddy Roosevelt. Until the 1990's, counties and schools 
were able to continue their work because they were compensated by the 
federal government for the abundance of tax-exempt federal land in 
their jurisdictions. However, as timber receipts declined, the solvency 
of rural counties and schools across the nation was also degraded. To 
address this challenge, Congress passed the Secure Rural Schools and 
Community Self Determination Act in 2000, which provided payments to 
counties and schools to make up for the decline in timber sale revenue.
    Unfortunately, we cannot go back and prevent the mistakes which 
have degraded our forests and the funding sources that counties and 
schools need. There is plenty of anger and frustration to go around on 
the subject. I was intimately involved in the Timber Wars of the 1980's 
and 1990's, and I will admit that I would not have sat in the same room 
with an environmentalist if you paid me. However, when I became a 
firsthand-witness to the massive fires that now burn in our country, 
and I saw their potential to destroy entire communities, I embraced the 
challenge to change the situation.
    Mr. Chairman, and Committee members, I am here today to testify 
that each of these events: 1) the loss of the forest products industry 
(along with the hundreds of jobs and millions of dollars in revenue it 
created), 2) the decline of timber receipts and subsequent passage of 
the Secure Rural Schools Act, and 3) the destruction of homes and 
prized recreational areas in my county and neighboring counties are the 
result of the degraded condition of the forest products industry in 
America's forests.
    Fortunately, there is a solution. The solution requires getting 
forest products industry back into the forest to thin the trees in an 
ecologically and socially responsible way. The solution involves 
stakeholders from the scientific, environmental, elected, forest 
service and industrial communities who are all at the table, and who 
all agree that we must reach common ground. The solution is called the 
Four Forest Restoration Initiative (4FRI) and it is a model for the 
kind of management that will end catastrophic wildfires and produce 
revenues for programs like PILT and the Secure Rural Schools Act.
    The model that has been developed in 4FRI calls on the Federal 
Government to partner with private industry to thin upwards of 50,000 
acres of forested land in Arizona per year at little or no cost to the 
Federal Government. This model, developed over the last three years by 
the stakeholders I have mentioned, represents America's best chance for 
revitalizing the forest products industry and restoring the forest, and 
it can be replicated throughout the country.
    Mr. Chairman, and Committee members, we can and should do 
everything possible to revitalize the forest products industry through 
active forest management policies like 4FRI, but Arizona's counties 
cannot wait for that to happen. In addition to pursuing an active 
forest management policy, Congress can and must enact a full and long-
term reauthorization of PILT and the Secure Rural Schools Act.
    Failure to reauthorize the Secure Rural Schools Act would mean that 
federal payments to Arizona counties would drop from $73 million in the 
last four years, to barely $1 million in 2012, jeopardizing critical 
education and public safety programs in Arizona's counties.
    For example, Coconino County--the county that Congressman Gosar 
resides in--would lose nearly 80% of its search and rescue funding--a 
critical service for a county known as a recreation and hunting 
destination. Likewise, in that county's remote town of Freedonia, 
Kindergarten and 1st-grade classes would be eliminated, forcing those 
students to be bused to a school over 30 miles away.
    The re-growth of our forest product industries can make a 
difference in the revenues necessary to fund these programs, but it is 
going to take time, and as tempting as it may be not to reauthorize the 
Secure Rural Schools Act I must impress upon you that the forest 
products industry cannot immediately provide the federal government, 
rural counties and schools with the sales revenue necessary. The fact 
is, those efforts will take years.
    In the meantime, counties like mine that have already been 
devastated by state budget cuts and cost shifts would be further 
devastated by the loss of a revenue source that compensates for the 
abundance of tax-exempt federal land in rural jurisdictions.
    Mr. Chairman, and Committee members, as a county supervisor who has 
seen and experienced the consequences of a forest that is not permitted 
to be properly managed, I implore you to do two things:
        1.  Support the solution of an active forest management policy, 
        modeled after the Four Forests Restoration Initiative, and in 
        the meantime,
        2.  Support the long-term funding of PILT and the 
        reauthorization of the Secure Rural Schools Act.
    Thank you for this opportunity. I would be happy to stand for any 
questions.
                                 ______
                                 
    Mr. Bishop. Thank you, Mr. Tenney. Ms. Morrison.

                  STATEMENT OF ANNA MORRISON, 
                        WOMEN IN TIMBER

    Ms. Morrison. Chairman Bishop and Subcommittee Members, 
thank you for allowing me to speak before you today. My name is 
Anna Morrison. I am representing Oregon Women in Timber as well 
as American Agri-Women. I bring a unique perspective to this 
hearing in that I have a history surrounding the Secure Rural 
Schools legislation.
    Initially, I lobbied for this legislation as a county 
commissioner from Oregon. It was always meant to be a six-year 
funding stopgap until the forests were reopened to harvest 
levels sustaining rural schools and roads. It was never 
intended to be the entitlement program it has become. I chaired 
and served on two Forest Service RACs and one BLM RAC. The sole 
purpose was to find ways to spend the Title II and III monies 
that were included in the legislation. That was supposed to be 
used for on-the-ground projects in the forest.
    For years monies have been wasted, in my opinion, mostly on 
projects that had little merit or need. Many were pie in the 
sky projects that benefitted only those who submitted the 
project. I have actual U.S. Forest Service email documents from 
employees hoping they could find ways to spend the money.
    We request, respectfully, that you not reauthorize this 
bill that is in the Administration's FY 2012 budget. From 1908 
until 1991, the revenue sharing plans specifying 25 percent 
return to forested counties. By the late 1980s, national 
policies and court injunctions diminished revenues generating 
activity in our national forests drastically. By 1998, revenues 
for national forest counties declined by 70 percent. This 
decline had a devastating impact on communities nationwide due 
to an almost total shutdown of timber harvesting in the Federal 
forest.
    Beginning in 1991, led by Senators Hatfield and Packwood, 
Congress began to subsidize county payments in western Oregon. 
Near the end of the decade Congress recognized its obligation 
to Rural America. Congress passed the Secure Rural Schools and 
Community Self-Determination Act of 2000, and President Clinton 
signed the bill. It provided six years of entitlements. In 2000 
again, Congress extended the Secure Rural Schools for one year. 
In 2008, Congress once again extended and gave us four more 
years on this entitlement program.
    During that period of time, the Forest Service was to ramp 
up the timber harvest program so that the entitlement was no 
longer needed. However, that has not happened.
    Under the original legislation there was also a Forest 
County Payments Committee that was formed to report back to 
Congress on possible solutions. Reports were submitted to 
Congress in 2003, 2005, 2006. These are copies of those reports 
to this body. However, nothing has ever been done with the 
recommendations.
    As we move forward, we strongly request that you support 
legislative efforts that seek to provide incentives for 
increased timber sales and other activities on the national 
forest. These, in turn, provide jobs and socio-economic 
benefits in addition to the timber receipts that are shared 
with local communities. In the late 1980s, increased timber 
harvest from the Federal lands generated eight times the 
economic benefit that is currently being provided by Secure 
Rural Schools.
    New legislation should include the following basic 
principles:
    One, long-term public forest health and timber production 
is vitally important to the people and communities adjacent to 
these lands. We urgently need to revive the Healthy Forest 
Restoration Act II.
    Two, as Congress mandated in enacting the legislation 
public resources on national forests and Bureau of Land 
Management should be managed to provide the people of our 
nation with consumer products, jobs, and sustainable sources of 
revenue.
    Three, the Federal Government has an obligation to return 
to the 25 percent of all gross receipts. Oh, hard targets, 
implement the maximum harvest of the volume allowed annually 
for timber sales on each forest under the respective forest 
plan.
    It is the age of no more entitlements. We need jobs, jobs, 
jobs in our rural-dependent communities. You must ensure a 
long-term forest managed program and to return to actual gross 
timber receipts. We need to get these communities off the dole. 
No more Secure Rural Schools.
    At a time when about half of the Forest Service budget is 
spent fighting fires due to bug-infested dead and dying, 
overcrowded forest it makes more sense from a fiscal and 
environmental standpoint to better manage the forest by using 
the resources instead of taking money from the Federal coffers 
to subsidize. We can sell the timber, put back money. We can 
harvest, provide for the people, pay for schools and roads, and 
still protect the environment. It makes perfect sense.
    Thank you very much for allowing me to testify. I would be 
available for any questions.
    [The prepared statement of Ms. Morrison follows:]

Statement of Anna Morrison, Legislative Chair, Oregon Women In Timber, 
                           San Antonio, Texas

    Chairman Bishop and Subcommittee Members,
    I am Anna Morrison. I am representing Oregon Women In Timber, as 
well as American Agri-Women. I bring a unique perspective to this 
hearing in that I have a history surrounding the Secure Rural Schools 
legislation. Initially I lobbied for this legislation as a county 
commissioner from Oregon. It was always meant to be a 6 year funding 
stop gap until the forests were reopened to harvest levels sustaining 
rural schools and roads. It was never intended to be the entitlement 
program it has become. I chaired and served on 2 Forest Service RACS 
and 1 BLM RAC. The sole purpose was to find ways to spend the Title II 
and III entitlement monies from Secure Rural Schools Legislation that 
was to be used for on the ground forest projects. For years monies have 
been wasted, in my opinion, mostly on projects that had little merit or 
need. Many were ``pie in the sky'' projects that benefitted only those 
who submitted the project. I have actual USFS email documents from 
employees hoping they could find ways to spend the money.
    We respectfully request that you not reauthorize the Secure Rural 
Schools and Communities Self-Determination Act that is in the 
administration's Fiscal (FY) 2012 budget. From 1908 until 1991 the 
revenue sharing plan specifying 25 percent of all revenues from 
National Forests were to be returned to forested counties. By the late 
1980's national policies and court injunctions diminished revenue 
generating activity in our national forests drastically. By 1998, 
revenues for national forest counties had declined by 70 percent. This 
decline had a devastating impact on communities nationwide due to an 
almost total shutdown of timber harvesting in the federal forest.
    Beginning in 1991, lead by Senators Hatfield and Packwood, Congress 
began to subsidize county payments in Western Oregon. Near the end of 
the decade Congress recognized its obligation to rural America. 
Congress passed the Secure Rural Schools and Communities Self-
Determination Act of 2000, and President Clinton signed the bill. It 
provided six years of entitlements. In 2007, Congress extended the 
SRSCA for one year. In 2008, Congress once again provided a four year 
extension of the SRSCA for 2008-2011.
    During this period of time the Forest Service was to ramp up the 
timber harvest program so that the entitlement was no longer needed. 
However, that has not happened. Under the original legislation there 
was also a Forest Counties Payments Committee that was formed to report 
back to Congress on possible solutions. Reports were submitted to 
Congress in 2003 and 2006. However, nothing has ever been done with the 
recommendations.
    As we move forward, we strongly request that you support 
legislative efforts that seek to provide incentives for increased 
timber sales and other activities on the national forest. These in turn 
provide jobs and socio-economic benefits, in addition to the timber 
receipts that are shared with local communities. In the late 1980's 
increased timber harvests from the federal lands generated eight times 
the economic benefit that is currently being provided by the Secure 
Rural School Payments.
    New legislation should include the following basic principles:
          Long term public forest health and timber production 
        is vitally important to the people and communities adjacent to 
        these lands and to the public at large. We urgently need to 
        revive the Healthy Forest Restoration Act II.
          As Congress mandated in enacting the legislation, 
        Public forest resources on National Forests and Bureau of Land 
        Management lands should be managed to provide the people of our 
        nation with consumer products, jobs and a sustainable source of 
        revenue to support local schools and counties. This is 
        attainable while sustaining a healthy multiple use forest.
          The federal government has an obligation to return 
        25% of all gross receipts generated on all forest lands to the 
        counties in which these lands lie; and/or 50% of gross receipts 
        from O&C land (Oregon/California Railroad Lands); and/or 4% of 
        gross receipts from Public Domain lands.
          Hard targets -Implement the maximum harvest of the 
        volume allowed annually for timber sales in each forest under 
        the respective forest plan.
    It's the age of No more Entitlements! We need Jobs, Jobs, Jobs in 
our rural, timber dependent communities. You must ensure a long-term 
forest management program and a return to actual gross timber receipts. 
We need to get these communities ``off the Dole''. No more Secure Rural 
Schools and Communities Self-Determination Act. At a time when about 
half of the Forest Service budget is spent fighting fires, due to bug 
infested, dead and dying
    Over-crowded forests, it makes far more sense, from a fiscal and 
environmental standpoint, to better manage the forests by using the 
resource. We can harvest, provide for the people and still protect the 
environment. It makes perfect sense.
    Thank you.
                                 ______
                                 
    Mr. Bishop. Thank you. Mr. Crews.

           STATEMENT OF DAVID CREWS, SUPERINTENDENT, 
                NORWOOD COLORADO SCHOOL DISTRICT

    Mr. Crews. Good afternoon, Mr. Chairman and Members of the 
Committee.
    My name is Dave Crews. I am the Superintendent of Schools 
in Norwood, Colorado, which is a small ranching community on 
the Western Slope. Today I am representing superintendents and 
school districts from Colorado who want to share the grave 
concern we have about the potential loss of the Secure Rural 
Schools and Communities Self-Determination Act. We are grateful 
for the Act. The concerns I express are very real as nearly 68 
percent of Colorado's forests are in Federal ownership.
    As a resident of Colorado, I appreciate the year-around 
outdoor activities this provides, but as a member of a rural 
community, an educator and a parent I must live with the 
consequences of that Federal ownership as well. I am a resident 
of San Miguel County. This county, like others across the 
state, is limited in the amount of taxes collected based upon 
the amount of national and state owned lands, and then unlike 
the urban and suburban areas along the front range of Colorado 
it is almost impossible for us to tap into additional resources 
for our students.
    The reality for my home county as well as other rural 
counties in the state is that revenues from our forested land 
are not available to support the educational programs in either 
the form of bond elections or mil levy overrides. It is 
untaxable land.
    To offset those tax losses the rural school districts in 
the State of Colorado use the SRSCA dollars to maintain and 
support educational opportunities for students. This year my 
school district used the funding to implement a new K-12 
writing program in order to improve our children's writing 
skills. Over the years the dollars have been used to develop 
and implement instructional strategies, improve our children's 
writing and math scores, and to prepare every student for post-
secondary endeavors.
    For other districts in my regional area the funding is used 
to pay for additional teachers, to keep class sizes smaller, 
and to deliver a higher quality of instruction and to devote 
more time to each student to improve their learning. Studies 
indicate that students achieve more with well trained teachers 
employing effective instructional techniques in small class-
size settings. The result is seen in higher test scores, better 
preparedness for life after high school, and increased post-
secondary success.
    School districts across the State of Colorado are using the 
additional money from Secure Rural Schools to fund technology 
programs. One of the challenges faced by many of the rural 
school districts is limited Internet access. Most rely on a 
broadband delivered through phone or cable services. Many 
schools are using these funds to establish WiFi networks, 
allowing students to access the Internet not only at school, 
but the community, and also in their homes.
    For some school districts the money is not just to create 
new programs, but actually augments the operating revenue 
resources that keep school districts running and capable of 
providing services and education in that regional setting.
    Statewide there are nearly 480,000 school age children 
living in Colorado counties that receive SRSCA funding. With 
the potential loss of these funds a critical link between rural 
families and access to education could be permanently severed 
forcing the affected families to drive dozens of miles, often 
over hazardous snowbound roads in order for their child to 
attend school. This challenge is the fundamental premise of 
fairness and equal access to education between rural and urban 
school children, placing some of our poorest and most at risk 
students at a distinct disadvantage.
    K-12 public schools in Colorado are primarily funded 
through a combination of local property taxes and state 
revenues. Historically property taxes have made up the majority 
of funding. However, property taxes have declined 
significantly, and because of the Gallagher Amendment in the 
state constitution which limits the valuation of residential 
property the state is required to fill in for losses that 
residential property once covered.
    School districts can raise additional revenues through 
local bond and mil levy elections up to a specified level, but 
the economic vitality of many rural communities cannot support 
money raised through local bonds and mils.
    Schools are not only the beneficiary of this funding. 
Counties and county services benefit as well. School district 
representatives such as myself meet annually with the county 
commissioners to determine how to allocate the Secure Rural 
Schools fund for that year. School administrators have built 
communication, relationships with county commissioners, and 
have developed increased communication and understanding about 
the needs of the county and our students. We appreciate that 
Congress has supported the century-long commitment to schools 
and counties.
    In closing, I would like to emphasize the need to 
reauthorize the Secure Rural Schools and Communities Self-
Determination Act. With the elimination of this resource, rural 
districts will suffer additional hardships and the education of 
our children will be affected. What I am hearing today is that 
we need to make production changes in the national forests but 
that will take some time. I feel the need to have this SRSCA 
reauthorized while these changes occur. Thank you for your 
time.
    [The prepared statement of Mr. Crews follows:]

               Statement of David Crews, Superintendent, 
               Norwood School District, Norwood, Colorado

To: Chairman Bishop and Ranking Member Grijalva,
    My name is David Crews; I live and work in the town of Norwood on 
the Western Slope of Colorado. Today, I am here representing 
superintendents and school districts from Colorado who want to share 
the very grave concern we have about the potential loss of the Secure 
Rural School and Community Self-Determination Act. We are grateful for 
the Secure Rural Schools and Community Self-Determination Act which was 
originally established in 2000. The Act preserves the commitment made 
by President Roosevelt in 1910 when these forests were set aside for 
the benefit of the entire nation. As you are aware, SRSCA Funds are 
used to support educational and county services within forested 
communities.
    The concerns I express are very real as nearly 68 percent of 
Colorado's forests are in federal ownership. As a resident of Colorado, 
I appreciate the year-round outdoor activities this provides; but as a 
member of a rural community, an educator and a parent, I must live with 
the consequences of that federal ownership as well. I am a resident of 
San Miguel County. This County, like others across the State is limited 
in the amount of taxes collected based upon the amount of national and 
state owned lands. And, unlike the urban and suburban areas along the 
Front Range it is almost impossible for us to tap into additional 
resources for our students. The reality for my home county, as well as 
other rural counties in the State, is that revenues from our forested 
land are not available to support our educational programs in either 
the form of bond elections or mill levy overrides. It is untaxable 
land!
    To offset those tax losses, the rural school districts in the State 
of Colorado use SRSCA dollars to maintain and support educational 
opportunities for students. This year, my school district used the 
funding to implement a new K-12 writing program in order to improve our 
children's writing skills. Over the years the dollars have been used to 
develop and implement instructional strategies, improve our children's 
writing and math scores, and to prepare every student for post-
secondary endeavors.
    For other school districts in my regional area the funding is used 
to pay for additional teachers to keep the class sizes small to deliver 
a higher quality of instruction and to devote more time to each student 
to improve their learning. Studies indicate that students achieve more 
with well-trained teachers, employing effective instructional 
techniques in small class size settings. This results in higher test 
scores, better preparedness for life after high school and increased 
post-secondary success.
    School districts across the State of Colorado are also using the 
additional money from the Secure Rural Schools and Community Self-
Determination Act to fund technology programs. One of the challenges 
faced by many rural school districts is limited internet access. Most 
rely on broadband delivered through phone or cable services. The speed 
and ease for delivery of information places these children at a 
distinct advantage. Many schools are using these funds to establish 
WIFI networks allowing students to access the internet not only at 
school but in the community and in their homes. For some school 
districts this money doesn't just go for additional instructional 
programs but augments the operating revenue resources to keep a school 
district running and capable of providing services and education in a 
regional setting.
    Statewide there are nearly 480,000 school-age children living in 
Colorado counties that receive SRSCA funding. With the potential loss 
of these funds, a critical link between rural families and access to 
education could be permanently severed, forcing the affected families 
to drive dozens of miles, often over hazardous snowbound roads, in 
order for their child to attend school. This challenges the fundamental 
premise of fairness and equal access to education between rural and 
urban school children, placing some of our poorest and most at risk 
students at a distinct disadvantage.
    K-12 public schools in Colorado are primarily funded through a 
combination local property taxes and state revenues. Historically, 
property taxes have made up the majority of funding. However, property 
taxes have declined precipitously, and because of the Gallagher 
Amendment to the State Constitution, which limits the valuation of 
residential property, the State is required to fill in for losses that 
residential property once covered. School districts can raise 
additional revenues through local bond and mill levy elections up to a 
specified level, but the economic vitality of many rural communities 
cannot support money raised through local bonds and mills. Another 
challenge we face: the State funds local school districts at a lower 
levels than the majority of the other States resulting in an increased 
reliance by rural school districts in Colorado on SRSCA. We appreciate 
that Congress has supported the century long commitment to schools and 
counties.
    Schools are not the only beneficiaries of SRSCA funding: counties 
and county services benefit as well. School Districts Representatives 
meet annually with their County Commissioners to determine how to 
allocate the secure rural schools funds for that year. School 
administrators have built relationships with county commissioners and 
have developed increased communication and understanding about the 
needs of the county and our students.
    In closing, I would like to emphasize the need to reauthorize the 
Secure Rural Schools and Community Self-Determination Act. With the 
elimination of this resource, rural districts will suffer additional 
hardships--and the education of our children will suffer. I appreciate 
the time you have given to hear my concerns and hope you have a better 
understanding of the importance of SRSCA to the rural school children 
of Colorado.
                                 ______
                                 
    Mr. Bishop. Thank you. I appreciate the testimony from our 
witnesses. We will have some questions first from Mr. Grijalva.
    Mr. Grijalva. Thank you, Mr. Chairman.
    Supervisor Tenney, let me ask you a question, and welcome. 
Hypothetically let us say we are able to return to those 
historic levels of timber production and that counties receive 
25 percent of the revenue, and you mentioned about a transition 
period but let me ask you. Would that funding stream, would 
that be stable? Would there be economic, political, weather, 
climate changes that would affect that revenue stream, that 25 
percent?
    Mr. Tenney. Mr. Chairman, Congressman Grijalva, certainly 
there are things that affect funding streams from every angle. 
But is it sustainable? I believe it is. It is a natural 
resource that we are dealing with. The communities that are 
taking money now from Secure Rural Schools are communities that 
were founded because of the abundance of natural resources that 
are there.
    I don't necessarily believe that we have to return to the 
250 million board feet of timber that was being harvested in 
Arizona and New Mexico in the eighties and nineties, but we 
certainly need to do more than the zero that was harvested in 
1998, 1999 and 2000. It has got to be somewhere in between. We 
have to return industry to the equation.
    Mr. Grijalva. Thank you for that, Supervisor. One of the 
proposition is that we go from this entitlement, get to those 
historic levels, from some of the testimony overnight, and 
therefore that guaranteed stream level would be there. What do 
you think of that scenario?
    Mr. Tenney. Well, Mr. Grijalva, first of all, I don't see 
anything happening overnight. It is going to take--in our area 
at least the mills are all gone. There is a good graphic 
showing the decline from 400 mills to 100 in the State of 
Oregon. Arizona has certainly lost a greater percentage than 
that. Those mills are not there. That is going to take time.
    But I also didn't hear anyone asking that we return to 
historic levels. What I hear people ask is a return to some 
level and it would not take the historic level to give the 
amount of funding that is coming to schools and counties right 
now through Secure Rural Schools funding. Those numbers weren't 
based on what the maximum levels once were reached.
    Mr. Grijalva. So SRS funding, in your opinion, Supervisor, 
needs to be reauthorized and then the balance issue, the in 
between issue, the point that you made is something that 
happens down the road?
    Mr. Tenney. I think all of it needs to happen. It needs to 
be reauthorized in the sense that until industry is 
reintroduced that is the solution, but industry is the answer. 
The long-term solution is industry back in our forests.
    Ms. Morrison spoke of the entitlement. None of us want 
entitlement. What we feel we are entitled to is using the 
forest for the benefit that it has. The renewable resource and 
the blessing it can be to our families and our communities in 
the way of jobs, employment and revenues coming into those 
communities will far outweigh anything that we are getting from 
Congress and Secure Rural Schools. So ultimately we would just 
as soon see it go away, but only when industry is back in 
place. Until then it needs to stay put.
    Mr. Grijalva. Thank you. Mr. Crews, outside of the SRS 
funds, and you mentioned your school system, what do you think 
led to the strength of your particular school system--and 
congratulations on that--besides the SRS funding?
    Mr. Crews. As far as our communities are concerned, I think 
it is the support of the communities, support of the parents 
and the importance of education. Again, we are doing a lot of 
things with limited amount of money. We are being asked to do 
that not only at our community level but also at the state 
level, but educating kids is what we need to do and that is 
important, so whatever we can receive will help.
    Mr. Grijalva. Thank you. That is it. Yield back
    Mr. Bishop. Thank you. Mr. McClintock.
    Mr. McClintock. Just a couple of points. I would first Mr. 
Tenney offered the observation that economic revival once these 
policies are changed might happen a lot faster than you think 
as one economist put it to me. It doesn't take businesses long 
to follow you back into an area if you are dropping $100 bills 
along the way. In other words, if they are able to make a 
profit it is amazing how dynamic they are and how quickly they 
will return. So, I think you are selling short the impact of 
policy changes on the economy of these local communities.
    I know in my area we have had three mills close last year. 
They are still there. They are just closed. We had 300 families 
put out of work in each one of those communities and those are 
small communities. The impact is huge. But the sole reason or 
the principal reason anyway was lack of timber supply for the 
mills to use. Bring back that timber supply, those mills will 
reopen. The families will get their jobs back and the economy 
will prosper and it will happen a lot faster than you think.
    Any thoughts?
    Mr. Tenney. Yes. I want you to know I agree with you. I 
didn't mean to sound like I don't think it will come back. It 
will absolutely come back. The reason I say it is going to take 
time is until you change some of the Federal policies, like 
NEPA, ESA and others that slow that process down, you cannot 
shut off SRS tomorrow and offer timber sales the next day----
    Mr. McClintock. Agreed, agreed.
    Mr. Tenney.--and expect that they are going to coincide 
because NEPA is going to take two years to get done.
    Mr. McClintock. And unfortunately we can't change policy 
overnight here.
    Mr. Tenney. Right.
    Mr. McClintock. We can from the House side but we still 
have a recalcitrant Senate and White House to deal with, and 
that is something the American people are going to have to 
address in the next year.
    Mr. Tenney. Can I add one thing?
    Mr. McClintock. Sure.
    Mr. Tenney. I agree with you. The people of our communities 
are aching to get back to work in the forest.
    Mr. McClintock. I know.
    Mr. Tenney. Now they are watching to see what happens to 
the salvage of the Wallow fire. We burned 2.5 billion board 
feet in that Wallow fire. Over 73--an ultimate irony here--over 
73, or 73 is the number of spotted owl nest areas that burned. 
If my recollection is right, it is over half of the, or between 
half and a third of the total area is protected in our state 
just burned. That is not what the environmental community 
wanted. That is not what any of us want.
    Mr. McClintock. No, I disagree with you on that point. If 
you talk to them, you will find out it is precisely what they 
want. For some reason they don't understand that the most 
environmentally devastating thing to a forest is a forest fire 
and that their policies have directly led to the high 
frequency, high intensity forest fires that we are seeing today 
because of the excess overgrowth that they have forbidden us 
from removing from the forests. And if you talk to a lot of 
them, they just say, well, that is nature's way. Well, I 
suppose you can say that, but the impact is devastating on the 
environment.
    Mr. Tenney. Nature's way is a smaller, lower intensity 
fire.
    Mr. McClintock. Exactly.
    Mr. Tenney. Not these catastrophic half a million acre 
fires.
    Mr. McClintock. No, I don't worship at the Church of Global 
Warming, I do believe the planet is warming. I believe it has 
been warming since the last Ice Age and whatever we do here I 
can guarantee you it will continue to warm and cool as it has 
for billions of years. But in that church they practice the 
faith of carbon sequestration, the idea that timber, 
particularly young growth timber, absorbs enormous amounts of 
carbon dioxide. That part is quite true. New growth timber 
absorbs carbon dioxide at a much, much higher rate, and higher 
volume than old growth timber.
    Why is it then that the only timber we are allowed to 
harvest at all is the young growth timber? I don't understand 
that. Perhaps somebody can offer some guidance to me on that 
point.
    Mr. Tenney. Is that question is aimed at me, I can't answer 
that either. I appreciated the question earlier about the 
Animal Kingdom. We certainly don't manage the Animal Kingdom 
that way, and I love to hunt and certainly would not be as near 
interested if all I could shoot was a spike elk instead of 
going for a large six point. I don't understand it.
    Mr. McClintock. You would not have a very healthy spike elk 
population.
    Mr. Tenney. Pretty soon you would not have anything because 
you have killed all the spikes.
    Mr. McClintock. And that is exactly how we are managing our 
forests today. It is insane.
    Mr. Tenney. You are asking a question of someone who is not 
qualified to answer but I agree exactly with you on this point. 
I don't understand the management practice. We need to return 
to harvesting all classes, and it needs to be based on science 
and it needs to have industry as a part of it. Until we get 
back to that point we are going to have these problems in our 
forests
    Mr. Bishop. Thank you. Mr. DeFazio.
    Mr. DeFazio. Thank you, Mr. Chairman.
    To Ms. Morrison. You are advocating that counties should 
get off the dole. As a former Oregon county commissioner, you 
know how critical particularly the ONC payments are to us were 
unique in that we have both ONC and Forest Service payments. 
Even if, and as you just heard the gentleman from California 
say we do have it, and I liked the description, recalcitrant 
Senate, I am usually not that polite about it, but anyway, a 
dysfunctional Senate and the White House. But let us just say 
the Senate went away and the White House, the President, as he 
does often, just decides to change his mind and support 
whatever comes out of the House, and we went back to something 
that the Forest Service could gear up for next year because 
obviously it is too late for this harvest season, some very 
robust level of harvest and the ONC lands, and somehow we got 
them in an appropriation so they could hire back all their 
timber sale officers who they have all laid off, and they could 
lay out the sales and there were no appeals or anything 
allowed. I mean, it would just go forward next year with a very 
robust harvest at some huge level.
    That would mean there would be substantial revenues. 
Unfortunately, the existing law says that it is an average of 
seven years. So even if we went back to 12 billion board feet 
next year, actually it would be, you know, averaged over the 
last seven years, the counties and schools would still get very 
little money. In fact, it would be about a 90 percent reduction 
for my counties.
    I don't have any currently elected county commissioners in 
Oregon nor am I aware in the Partnership for Rural America of 
currently elected county commissioners, 729 counties, who are 
advocating an immediate end to this program.
    How would you solve that problem?
    Ms. Morrison. I guess, Congressman, I am not naive. I 
understand what you are saying, and it is not going to happen 
overnight. However, these 729 counties have known since 2000 
what the future held. I question why have we allowed the 
agencies, BLM and the Forest Service, to continue in the same 
vein and not see any actual production on the lands.
    Again, back in 2003, 2005, 2006, the National Forest 
Counties Payments Committee did submit to this body, and I 
believe, Peter, you have a copy of this, recommendations for 
making payments to state and counties. However, nothing has 
ever been acted on in regards to those. At some point we are 
going to have to stop the program. As long as the schools and 
the counties think that they can come back and they are going 
to get a dribble here and a dribble there, you are bleeding 
them to death.
    Mr. DeFazio. I understand.
    Ms. Morrison. That is what you are doing.
    Mr. DeFazio. Thank you. Just reclaiming my time. My vision 
is that we get a temporary continuing authorization which is 
either a phase-out or it has a date certain on which it ends 
which gives us time to transition. I would also like to have an 
ongoing base payment at a lower level because we are never 
going to get back to the levels of harvest we had in the 
seventies and eighties.
    Ms. Morrison. Right.
    Mr. DeFazio. I mean the value of the timber is just not 
there. So, my vision is we both do active management, and I 
have for the first time the BLM actually working on pilot 
projects on the land, working with scientists to show there is 
a way we can go into these areas and do forestry and get a 
predictable level of harvest, although there is going to be a 
fight over that. But we would need a transition and I believe 
we need an ongoing base. That is my position. I mean, we are 
going to have to disagree over that, but I mean an immediate 
cutoff of all funds, no continuing authorization next year 
would mean virtually all the jails in southwest Oregon would 
close. We already are down to 20 hours a day for sheriff's 
patrols. In Lane County we would go down to probably zero hours 
per day----
    Ms. Morrison. Right.
    Mr. DeFazio. For Josephine, I know it would go to zero. 
Curry would go to zero. I mean, I just can't support that. It 
would just be catastrophic for the region.
    Ms. Morrison. And I agree about the catastrophic effect of 
this but at some point people have to come to the table and 
understand that we need to start doing this. I mean, back in 
1987 was the first time I testified here in D.C. at one of 
these panels. We needed to have management on the Federal lands 
then. We are now several years past. We are still dealing with 
the same questions. We are still not getting management on the 
lands. What do we do to get people to move?
    Mr. DeFazio. Well, we put in place a plan. It is just like 
balancing the budget here. We can't balance a budget in one 
year, but if we had a plan to balance it in 10 years so it was 
credible then people would say, OK, we get it, 10 years, that 
is reasonable, good.
    The same thing here, we need a transitional plan to move 
back to more active management. So thank you, Mr. Chairman.
    Mr. Bishop. Thank you. Mr. Tipton.
    Mr. Tipton. Thank you, Mr. Chairman, and Mr. Crews, I would 
like to welcome you. I am just down the road in Cortez. 
Certainly a pleasure to be able to see you here and appreciate 
your testimony.
    Could you give us a little example during your tenure while 
you have been in the Norwood School District how your funding 
levels have changed just over your time period there?
    Mr. Crews. Our funding levels for the whole general budget?
    Mr. Tipton. Just specifically what is coming off the Forest 
Service.
    Mr. Crews. Oh, off the Forest Service. It has reduced--the 
way it was set up in 2000, our county actually was taking 
probably 95 percent of the money, and then around 2008, I came 
in around 2007. Around 2008 one of the commissioners saw this 
and said that we need to give more money to our two school 
districts in our county, and so we received--at that year we 
were reversed and we received about 95 percent of the money 
between the two school districts.
    Mr. Tipton. Right.
    Mr. Crews. About that same time state law changed and 
created this 25 percent for the county, 25 percent for the 
schools, and then the 50 percent would be negotiated, the rest 
of it, and that was worked well. I have been involved in that 
for the last two years, and it has been a nice relationship 
that we have built with the county understanding kind of their 
needs and them understanding the needs that we have in our 
districts and for our kids, so it is working well.
    Mr. Tipton. But you are strained as a school district to be 
able to provide for your students?
    Mr. Crews. Well, overall, you know.
    Mr. Tipton. Could you maybe explain? You and I may be the 
only two people in the room that will be able to distinguish 
the difference. Is there a per capita difference in terms of 
Telluride versus Norwood?
    Mr. Crews. There is actually, as far as student PPOR, the 
money the people, the revenue money, we can--we actually 
receive a little bit more than Telluride just because of our 
need, so we have some state equalization levels there. As far 
as generating money, Telluride probably could generate more 
money with their assessed valuations than we can in Norwood.
    Mr. Tipton. That is my understanding, obviously
    Mr. Crews. There is that separation there between the two.
    Mr. Tipton. Right. I would like to go back over to Ms. 
Morrison. You were talking about trying to seek, and I gather 
Mr. Pearce just left, that you are looking for a long-term 
solution.
    Ms. Morrison. I didn't hear the first part that you said 
before Mr. Pearce.
    Mr. Tipton. I said Mr. Pearce just left from our previous 
panel, that it seemed to me that as county commissioner you are 
really looking for some kind of a long-term solution. You were 
talking about the report prior to my being here certainly. It 
was making some recommendations and there has been no response 
from Congress. Is this sort of like a tree falling in the 
forest if there is nobody there to hear it?
    Ms. Morrison. It could be like that but looking at this 
panel the makeup, there are only five on here that were here in 
2000 and 1999 when we first started working on this, and so 
again, you know, that education level, you are not being aware 
that these were submitted to Congress is understandable. Why 
they were never acted on I really don't know.
    And the other one is back in 1998 this was presented to 
Congress at the same time. This was options for the Forest 
Service Second Century, and this was a compilation of possible 
solutions on how Federal lands could be managed, and the trust 
concept is in here as to transferring the ownership, taking it 
away from the Forest Service or the Bureau of Land Management 
and putting it into a trust of some sort, and again, the group 
that put this together was very diverse. I mean, you had the 
National Wildlife Federation, you had Andy Stall on here. I am 
not sure you are familiar with Andy or not. You had Mark Ray, 
Doug Crandall. I mean, a real diverse group of people that 
actually agreed on these concepts on managing our Federal lands 
in the second century. Again, to my knowledge, there has not 
been a lot of discussion--I think it is starting--as to how we 
can utilize some of these recommendations
    Mr. Tipton. Well, believe me, I have real empathy as a 
Westerner, and obviously natural resources, many of our members 
come from the West, and I think our eastern counterparts 
sometimes have difficulty getting their arms around some of the 
challenges that we face when up to 98 percent of one county 
that I represent is either Federal or state lands. There are 
real challenges, and when we have school districts liked 
Norwood that are supposed to be able to educate our children, 
so we have people that are able to provide services when people 
come out to their public lands as well, national public lands 
as well. We want to be able to provide those services. We want 
to have an educated public, and we need to be able to find out 
a revenue stream that is going to be addressing those local 
concerns, and to be able to empower our local communities to be 
able to make some of those decisions, and the stumbling block, 
my sense is, is right here in Washington that we need to be 
working on.
    So thank you, Mr. Chairman.
    Ms. Morrison. More aggressively
    Mr. Bishop. Thank you. Mr. Garamendi. Oops, I mispronounced 
that too, didn't I? I have been mispronouncing every name 
today. Please don't take it personally.
    Mr. Garamendi. Like most of us in this business, we are 
called many, many different names.
    These issues have gone on forever. For me it is 36, almost 
37 years now dealing with these kinds of issues. There is a 
transition that is occurring in the timber industry in the 
West, at least in the Sierra Nevada mountains in the California 
region and I think also in Oregon, the transition from what was 
originally a selective harvest program to a clear cutting 
program and tending now back to either a selective harvest or a 
significantly reduced clear cutting program. I think that is 
kind of the transition we are in.
    That transition in its current stage moves toward a 
sustainability model so that there will be a sustained yield 
over a period of time, and also sustained employment that would 
be affected by the economy, the housing industry principally. 
So, I think that is where we are headed or maybe we are already 
there in some places. Just correct--yes or no?
    Ms. Morrison. I would agree.
    Mr. Garamendi. Now that being the case we are then in a 
transition period here in which these communities will 
stabilize at some level due to the--those that are dependent 
upon timber harvesting will stabilize at some level. In the 
region that I come from and represented for a long, long time, 
it is at a very minimal level, and the area has moved onto 
other kinds of activities principally, although there still is 
a timber industry.
    I think the question we are faced with--with the end of the 
SRS program or the need to renew it--is a transition period in 
which the communities are allowed to transition to a more 
stable level. Those communities that are in these areas also 
have new economies or potential growth economies, recreation 
principally, and maybe some other industries that have moved 
into the area.
    So back to that transition period. How would you want to 
structure say an SRS or a similar program for the next five 
years, and just run down the--I will let you start and go from 
there. I have two minutes and 30 seconds.
    Ms. Morrison. Again, when it was first passed in 2000, the 
thought was that during that period of time to 2006 that there 
would be this ramp down and ramp up, which did not happen. So 
what period of time do you want me to suggest when that didn't 
work? I am not sure----
    Mr. Garamendi. That begs the question. In your view why 
didn't it work?
    Ms. Morrison. Because I think that there was an 
unwillingness by the agencies. I mean, the agencies are 
strapped, to be perfectly honest. They are damned if they do 
and they are damned if they don't, and they drag their feet in 
regards to trying to get something out there. It is like they 
are trying to appease everybody. The analysis with paralysis, 
that is the agency side.
    Mr. Garamendi. OK.
    Ms. Morrison. Looking at it from the county side, I didn't 
see the counties, because I was very involved, I was on the 
board at that time, aggressively trying to find solutions to do 
this, and all of a sudden 2006 is here, oh, my god, we are at 
the cliff again. This willingness to work together and make 
direction, I think, needs to be----
    Mr. Garamendi. Given the problem you have described, and 
thank you, let me posit a couple of solutions. The Federal 
agencies, Bureau of Land Management and Forest Service, you are 
quite correct about the management. They are underfunded, 
understaffed, and you are correct about the box that they are 
in.
    Mr. Garamendi. Maybe we can do something about the box that 
they are in but clearly we are going to have to do something 
about the staffing level if we are going to be successful at 
getting timber harvest plans done.
    Ms. Morrison. They need road engineers, they need somebody 
that knows how to even plan a timber sale. They have fish 
biologists, wildlife biologists, hydrologists, geologists, but 
do they have engineers anymore that really know how to put up a 
timber sale? Not in my region they don't.
    Mr. Garamendi. Well, that is an important point for us to 
know, and we could potentially deal with that. So the timber 
harvest plans need to go forward. That is a piece of it. That 
provides some level of funding. It won't be at the maximum 
level that it used to be in the past, but it is presumably a 
sustained level over time.
    Then the payment side of it, that is, the Federal payments 
coming in. I don't have to time you and I don't have time to 
tell you anyway, but budgets are a little tight around here.
    Mr. Garamendi. And likely to be for awhile so we have to 
figure out how to deal with that piece of it, too--and then the 
final piece, and thank you for the additional time, Mr. 
Chairman--is the other kinds of economic activity that might be 
available in any given area, and it varies wherever it happens 
to be. So, we need a comprehensive look at this, and I think 
those would be the three areas. So as we go forward with a re-
write of the SRS, adequate Federal money, hopefully, the 
agencies, BLM, Forest Service, instructed to put together 
management plans, forest harvest plans, and then some sort of 
economic development program going on within the communities. 
Is that a reasonable model?
    Ms. Morrison. I am not sure about the economic development 
component. Being from a very small coastal rural community in 
Oregon, we are surrounded on three sides by Federal forests and 
the ocean on the west. We are very limited in any kind of 
economic development because of transportation issues, labor 
issues and those that bring people in. So we are a natural 
resource-based community. There are just no ands, ifs, buts or 
maybes about it.
    Mr. Garamendi. Understood. I will give an example that will 
occur perhaps I think in Mr. McClintock's new district. The 
communities there have joined together to develop a tourism 
plan. It used to be logging and agriculture, but now it is 
morphing into something different, so there may be tourism 
opportunities. Kind of like to go to your place and forget 
about this place for a couple of days, so you have that kind of 
potential.
    Anyway, maybe the legislation could be drafted in such a 
way as to deal with those three elements.
    Mr. Chairman, I have taken more than my time and I 
appreciate it. Thank you so very much
    Mr. Bishop. Thank you. I appreciate it. Let me ask a couple 
of questions here, Mr. Tenney, if I could.
    Has the planning process for the Forest Restoration 
Initiatives indicated how much timber revenue it could produced 
that could be shared with the counties?
    Mr. Tenney. Mr. Chairman, yes, the plan process is well 
underway and we are trying to do this in big chunks. The first 
planning process we are undergoing right now is a 700,000-acre 
area. They have never done NEPA at this scale before. We are 
out. The first RFP from the Forest Service for the first 
contract is 4FRI is out right now. Those bids are due back in 
roughly a month, and that is going to tell us a great deal 
about what are the industries that are out there that are 
saying they are willing to return to the area. There have 
been--people have stepped up and said they are willing to put 
in OSP plants and things of that nature. That RFP process is 
going to tell us what those companies will pay.
    Bear in mind that the 4FRI is largely the small diameter 
timber. It is not really getting into the big commercial 
timber. That needs to come as part of another project, but it 
is a little too early, Mr. Chairman, to tell what they are 
saying those revenues will be. I don't anticipate a lot of 
revenues off of at least the first initial contract in 4FRI, 
but to me it is a lot like the Field of Dreams, build it and 
they will come.
    We start offering up these timber sales and start offering 
up these acreage for treatment and the industry will return and 
the receipts will return
    Mr. Bishop. Thank you. You know, many, in fact almost 
everyone has argued today that in order to increase the forest 
management on a broad scale we have to address NEPA reform or 
other environmental laws that seems to help delay or obstruct 
active forest management. Is that something Navajo County would 
support as part of a legislation that might extend Secure Rural 
Schools?
    Mr. Tenney. Absolutely. Everyone that I deal with 
understands that NEPA is a problem in these processes, and that 
some type of reform is needed. You know, one thing that comes 
to my mind, my kids are, and I have been involved extensively 
in athletics and especially in wrestling, and the legendary 
wrestler Dan Gable is famous for saying, ``If nothing changes, 
nothing changes.'' And you know, we can do all we want to say 
we are going to try to end Secure Rural Schools and have a 
plan, but if we don't change NEPA and some of the policies that 
the Forest Service and others are bound by it will never 
change, and you will never get to the transition period that 
Ms. Morrison is talking about to get away from being on the 
dole and getting back to using industry. We have to change it. 
Unfortunately, counties can't force that change as much as you 
folks can
    Mr. Bishop. I wish that were true.
    All right, Mr. Crews, let me ask just a couple of 
questions. Does the Colorado system have an equalization 
statewide for revenue for schools?
    Mr. Crews. Yes. Did you want me to explain the formula?
    Mr. Bishop. No, not necessary, but you do have a state 
equalization program for both----
    Mr. Crews. We do state equalization, right
    Mr. Bishop. For both MNO as well as construction?
    Mr. Crews. I am not sure for construction
    Mr. Bishop. OK. Would you support increasing management, 
forest management, timber revenues as a funding source?
    Mr. Crews. I would support it. From what I am learning as I 
am going through this, Colorado has some issues as far as like 
we were hearing today. There is only one mill that is on its 
way to being closed or is closed, and so there is going to be a 
lot of--there needs to be a lot of changes in Colorado in order 
for us to create that production in the forest.
    Mr. Bishop. I have no idea when you started the 
equalization formula in Colorado but with a 25 percent payment 
that Colorado has been receiving, provided education money 
before Secure Rural Schools went into effect, was that part of 
the equalization process or should it be? And if you don't know 
if it was just by timing, should it be part of the equalization 
process? Should the money and the revenue that comes into 
Secure Rural Schools or from increased sales be part of the 
equalization?
    Mr. Crews. I don't now if it was. If it generates any 
revenue, then yes.
    Mr. Bishop. Then it should be part of it.
    Mr. Crews. Yes.
    Mr. Bishop. OK. I have no further questions except I 
appreciate all three of our witnesses.
    Mr. McClintock, do you have anything further?
    Let me thank all three for spending time with us, for 
coming out here, for waiting through all of this time period. I 
appreciate it very much. We thank you for your testimony, both 
oral testimony and written ones which will appear in the 
record. If there is no further business, then we are adjourned. 
Thank you, sir.
    [Whereupon, at 12:55 p.m., the Subcommittee was adjourned.]

    [Additional material submitted for the record follows:]

    [``Community Forest Trust, A Pilot Project to Compliment 
Secure Rural Schools and Community Self Determination Act 
Reauthorization'' submitted for the record follows:]

Community Forest Trust
A Pilot Project to Compliment
Secure Rural Schools and Community Self Determination Act 
Reauthorization

July 26, 2011

Proposed by:
Boundary County, Idaho
Clearwater County, Idaho
Idaho County, Idaho
Shoshone County, Idaho
Valley County, Idaho

Summary
    Idaho counties with significant federal lands inside their borders 
are proposing a Community Forest Trust pilot project in Idaho. The 
pilot project will provide a pathway for counties to successfully 
transition away from federal transfer payments under the Secure Rural 
Schools (SRS) Act. The proposal is for Community Forests to be 
designated from federal forest lands within Idaho and managed in trust 
by the state for the benefit of county governments and local 
communities. Professional forest management would be provided by the 
Idaho Department of Lands under the environmental laws that apply to 
all Idaho state forest trust lands. Proceeds from management of the 
Community Forest Trust lands would be distributed to counties receiving 
Secure Rural Schools funding in lieu of transfer payments from the 
federal treasury, after having first reimbursed the Idaho Department of 
Lands for land management costs. Management of the Community Forest 
Trust lands would be overseen by an Idaho Community Forest Trust Board 
consisting of five elected county commissioners from the counties with 
the most significant proportion of federal forest land within the 
state.
Background
    The U.S. Congress has perpetually recognized special obligations to 
local governments and communities where the federal government has 
extensive land ownership. When federal forests were first established, 
the premise and promise was that local communities would welcome 
federal ownership as they would benefit both from the economic activity 
on federal forest lands and would receive a portion of the revenues 
generated from the sale of timber and other resources on those federal 
lands. Federal law required that 25% of the receipts from national 
forest resource sales be returned to the counties where those lands 
were located.
    Beginning in 2000, the U.S. Congress recognized that revenues from 
national forest activities had declined significantly and moved to meet 
the obligation to local governments and communities by enacting the 
Secure Rural School and County Self Determination Act (SRS). This law 
established transfer payment schedules for federal monies to be paid 
from the U.S. Treasury directly to the counties, proportionate to funds 
lost from timber harvest revenues, in order to meet the obligations of 
federal ownership. Since 2000, this law has been reauthorized twice and 
is now up for reauthorization again.
    The SRS funding was always intended to be an interim measure that 
would be in place only until new programs on federal forest lands were 
established that would provide reliable and sustainable revenue to 
local counties. That transition has not come to pass. Instead, federal 
forest management has declined, and with it, so too has the revenue to 
the U.S. treasury and local counties. New Forest Service programs 
targeted at landscape level forest restoration and fuels reduction have 
faltered or not come to fruition.
    This paper outlines a new way to restore much needed forest 
management on federal land as well as a way to generate a more reliable 
source of revenue for counties in Idaho that have historically depended 
on receipts from federal forest management activities. Authorizing a 
Community Forest Trust in Idaho will advance a reliable, sustainable 
and environmentally responsible forest management process that will 
also provide revenue to county governments to help pay for schools, 
road maintenance and other essential services.
Community Forest Trust
    The Community Forest Trust concept is offered as a long term 
solution to meeting the federal government's obligations to counties 
and communities with federal lands inside their borders. The goal 
ultimately is for the U.S. Congress to designate specific federal 
forest lands within Idaho as a Community Forest Trust that would be 
managed in trust for local counties and communities. Professional 
management of the Community Forest would be provided by the state's 
professional land management agency, the Idaho Department of Lands, for 
the legislatively defined purposes of supporting county governments and 
providing sustainable forest stewardship. The Community Forest Trust 
lands would remain the property of the United States government but 
would be managed in trust for county governments under environmental 
laws as they apply to state lands. Elected representatives from the 
federal land counties would be appointed by the Governor to a Community 
Forest Board that would ultimately be responsible for land management 
decisions. Management costs would be deducted from the revenue earned 
from land management activities and paid back to the Idaho Department 
of Lands.
    Net revenue generated from management of the Community Forests 
would be pooled and distributed under a mutually agreeable distribution 
formula to all counties within the state that are currently receiving 
SRS funding. These payments would offset any SRS payments from the 
federal government. Further, any net revenue generated from the 
Community Forests would not impact other county payments under the 
Payment in Lieu of Taxes (PILT) program.
Requirements
    Sustainability: Community Forests will be required to have a 
resource sustainability plan and must be managed to protect the long 
term productivity of soil and water.
    Public access: Public access will be provided to all Community 
Forest lands in a manner that best facilitates access and use and that 
protects environmental values.
    Environmental Laws: Environmental laws will apply to the management 
of the Community Forest lands as they are applied to the management of 
forest lands managed by the State of Idaho.
    Wildfire: The federal government will retain firefighting 
responsibility for the Community Forest Trust lands.
Environmental Standards
    Each of the counties proposing the Community Forest Trust concept 
is currently engaged in ongoing multi-stakeholder collaborative efforts 
on federal land projects that include Native American tribes and 
environmental organizations.
    The Community Forest Trust Board and individual participating 
counties will seek advice from established collaboratives and/or 
functioning Resource Advisory Committees (RACs) on how Community Forest 
Trust land management programs can best accomplish support for 
counties, communities and multi-stakeholder interests that are 
consistent with the purposes of the Community Forest Trust concept.
Community Forest Trust--Pilot Project
    The immediate proposal is for the U.S. Congress to approve a 
200,000-acre Community Forest Trust pilot project in Idaho to 
demonstrate how the project would function and to evaluate and fine-
tune the concept. The pilot would continue for at least five years or 
for the duration of the next SRS reauthorization, whichever is longer.
    Monitoring: Effective environmental and performance monitoring is 
key to the success of the Community Forest Trust pilot. Idaho State 
Best Management Practices (BMPs) and water quality monitoring programs 
will be required on all Community Forest Trust pilot lands in the same 
manner that they occur on existing state forest lands. Further, the 
Community Forest Trust Board will consider and implement additional 
monitoring programs that they determine necessary to properly evaluate 
the pilot program. Implementation of these monitoring activities will 
also be funded by revenue generated through Community Forest Trust 
management activities.
    Other monitoring programs from federal government and/or other 
third party interests are encouraged and permitted provided that the 
program designs are approved by the Idaho Department of Lands and the 
Community Forest Trust Board and that independent funding is provided.
Designation of Community Forest Trust Lands
    The designation of lands included in the Idaho Community Forest 
Trust pilot project will occur by federal law as part of the SRS Act 
reauthorization. The Idaho
    Department of Lands will use Forest Service data and 
recommendations to identify lands that best meet the purpose of the 
Community Forest Trust pilot.
    The following criteria will apply:
        1.  Roadless lands identified in the Idaho Roadless Rule cannot 
        be included in the pilot project unless they are classified as 
        General Forest by the Rule.
        2.  Selected lands will be in contiguous ``blocks,'' 
        efficiently sized for management purposes and among the Idaho 
        counties with established Idaho Department of Lands management 
        offices. To the extent practicable, lands will be selected that 
        include different forest types and landscape conditions to 
        evaluate differing opportunities within the state.
        3.  To the extent consistent with the purposes of the Community 
        Forest Trust concept, preference will be given to lands that 
        meet the following criteria:
                a.  Are within the Wildland-Urban Interface (WUI) or 
                otherwise identified by the counties as critical for 
                community protection.
                b.  Are classified as forest health condition Class 2 
                or 3 by the Forest Service.
                c.  Are consistent with management goals for endangered 
                species.
                                 ______
                                 
    [A statement submitted for the record by The Honorable Jeff 
Denham, a Representative in Congress from the State of 
California, follows:]

   Statement submitted for the record by The Honorable Jeff Denham, 
       a Representative in Congress from the State of California

    The Secure Rural Schools Program was implemented as a bridge 
program to provide time for rural counties to transition away from 
timber harvesting economies. The program was implemented because of the 
layers of environmental regulation that halted timber production on 
federal lands, which deprived local communities of timber receipts 
which helped fund local schools, roads, and emergency services. The 3rd 
reauthorization of this program will expire this year, and we cannot 
continue to proceed with the status quo; because doing so would further 
devastate our local and rural communities.
    Our local communities do not want to continue the Secure Rural 
Schools Program. They want jobs and healthy forests, and they are tired 
of the budget uncertainty, bug infestations, and the constant threat of 
wildfires. With the federal government controlling too much of the land 
in these counties, it is extremely difficult for the communities to 
redevelop, build and grow their economies. The status quo is continuing 
to hurt our local schools and communities as the payments are being 
pinched during these tough economic times.
    The federal government must begin to manage its forests in a safe, 
economical manner, including the harvesting of timber. With the 
appropriate management of our forests, our rural counties will be able 
to fund their schools, maintain their roads, and provide the necessary 
emergency services to keep the communities safe. This economically 
sound solution will also relieve the need for the Secure Rural Schools 
Program and provide jobs to these communities that are struggling. In 
my district the unemployment rate is well above the national average, 
and hovers around 17 percent. Relieving the high unemployment and 
providing the necessary funding for rural communities is imperative in 
today's economic climate.
    Another priority that is lost in the federal government's current 
forest management practices is that of preventing wild fires. As the 
Chair of the Economic Development, Public Buildings and Emergency 
Management Subcommittee, I am constantly trying to make sure that our 
forests are safe and the risk of wild fires is as minimal as possible. 
The mismanagement of our forests on federal land is directly increasing 
the risk of wild fires. According to the Forest Service, wild fires 
have burned an average of 7.8 million acres every year over the past 
five years. As a Representative from California, I am far too familiar 
with the devastation of wild fires. In California, where environmental 
regulations are far more over-burdensome than in other states, we are 
annually threatened by severe wild fires that cause millions of dollars 
in damages and claim many lives. We need to prevent these fires by 
managing our forests for the public interests of safety and job 
creation, which are far too often overlooked by the Administration and 
extreme environmental regulation.
    Not only has there been a failure to manage the forests on federal 
land, but there is a practice of prohibiting public access to federal 
lands. This prohibition coincides with the desire to stop timber 
harvesting and fails to produce economic value or renewable energy of 
the land. These federal lands are publicly owned and should be managed 
in the best interest of the public, not to their detriment. The use of 
the forests on federal land will create a viable economy and many job 
creation opportunities in the West. The economy and jobs surrounding 
the timber industry are not just those that are harvesting in the 
forest. The chain of jobs extends to biomass generation for a renewable 
energy source, to the building and housing market, and furniture 
production for use within those buildings and homes.
    The Secure Rural Schools Program is not the best option for our 
local counties. The best option is to develop and implement a forest 
management plan that will utilize our natural resources to put 
Americans back to work, create much needed energy supplies, and fund 
the rural schools and emergency services of our local communities. We 
can no longer continue along with the status quo, and we must begin to 
restart our timber industry to help our struggling communities relieve 
high unemployment and constant budget uncertainty.
                                 ______
                                 
    [A letter submitted for the record by Steve Moyer, Vice 
President for Government Affairs, Trout Unlimited, follows:]

The Honorable Rob Bishop
Chairman
Subcommittee on National Parks. Forests and Public Lands
123 Cannon
Washington, DC 20515

The Honorable Raul Grijalva
Ranking Member
Subcommittee on National Parks. Forests and Public Lands
1511 Longworth
Washington, DC 20515

RE:  Oversight Hearing on Secure Rural Schools Reauthorization and 
Forest Management Options for a Viable County Payments Program

Dear Chairman Bishop and Ranking Member Grijalva,

    I am writing on behalf of Trout Unlimited and its 140,000 members 
nationwide in support of reauthorizing the Secure and Rural Schools and 
Community Self-Determination Act (SRSCA). Since its enactment in 2001, 
SRSCA has made an important contribution to community infrastructure 
and public land stewardship in rural counties. The SRSCA has been a key 
funding source for rural counties' essential services, including roads 
and schools, and also has provided critical funding for public land 
restoration projects. Healthy public lands not only provide high 
quality habitat for fish and wildlife and thus exceptional fishing and 
hunting opportunities, but also important services on which downstream 
communities rely, such as clean water.
    Under SRSCA, allocated funds are organized under three titles 
(Title I, Title II and Title III), and are used by rural counties for a 
variety of purposes. Title II supports cooperative resource 
conservation projects with strong stakeholder and community buy-in. 
Under Title II, the Secretaries of Agriculture and Interior are 
authorized to establish Resource Advisory Committees (RACs), which are 
charged with proposing Title II projects. Each RAC must consist of 
fifteen stakeholders, broadly representing conservation, community and 
commodity interests. The applicable Secretary has the discretion to 
approve of RAC projects. Such projects must further the purposes of the 
SRSCA, including fostering investment in roads and other 
infrastructure, soil productivity, ecosystem health, watershed 
restoration and maintenance, control of noxious weeds, and 
reestablishment of native species.
    The RACs created under SRSCA are a natural fit with TU's work 
because of our partnership approach, and our focus on restoring 
watersheds. The funding that comes through the RACs has contributed to 
these cooperative restoration efforts.
    Lincoln County, Montana is representative of economically stressed 
rural counties with large public land holdings that have benefited from 
SRSCA funding. Throughout the most recent re-authorization of the Act 
(FY 2008-2011), payments to Lincoln County have totaled $7,182,763; 
$804,158 of which were Title II funds. Through these Title II funds 
alone, over 256 projects have been approved and 62 projects have been 
completed. Title II projects create jobs because the work is done by 
local contractors. For example, $25,000 in SRSCA funds were used in 
Lincoln County to replace an under-sized road culvert with a larger, 
bottomless arch culvert, restoring fish passage in Zulu Creek for 
native Westslope cutthroat trout and preventing future road failures, 
thereby creating significant cost savings for Lincoln County. Simply 
put, many projects like the Zulu Creek culvert replacement would not 
happen without SRSCA funding.
    Because of its demonstrable success, we strongly support 
reauthorization of the SRSCA. This legislation has promoted healthier 
public lands in tandem with healthy rural communities. To date, the 
SRSCA has provided funding for hundreds of stewardship projects in 
rural counties and created new economic opportunities across a number 
of sectors. The reauthorization of the SRSCA is an important step 
toward securing the future health of our rural communities and public 
lands and waters.

Sincerely,

Steve Moyer
Vice President for Government Affairs
Trout Unlimited
                                 ______
                                 
    [``Proposing a Community Forest Trust'' submitted for the 
record by Boundary County, Idaho; Clearwater County, Idaho; 
Idaho County, Idaho; Shoshone County, Idaho; and Valley County, 
Idaho, follows:]

                   PROPOSING A COMMUNITY FOREST TRUST

STATEMENT OF
SKIP BRANDT, COMMISSIONER, IDAHO COUNTY, IDAHO
JON CANTAMESSA, COMMISSIONER, SHOSHONE COUNTY, IDAHO
GORDON CRUICKSHANK, COMMISSIONER, VALLEY COUNTY, IDAHO
DAN DINNING, COMMISSIONER, BOUNDARY COUNTY, IDAHO
STAN LEACH, COMMISSIONER, CLEARWATER COUNTY, IDAHO
Introduction
    This statement is submitted by five duly elected County 
Commissioners from five different counties throughout the forested 
region of Idaho. This statement presents a Community Forest Trust 
proposal that will allow a transition path from the federal transfer 
payments of the Secure Rural Schools and Community Self Determination 
Act (SRS) program, to a sustainable and reliable program for revenues 
which do not depend on distributions from the U.S. Treasury. Our 
proposal is for specific lands within the Idaho national forests to be 
designated as a Community Forest Trust and that the resources on those 
lands be managed in an sustainable and environmentally sound manner for 
the purpose of generating resources for Idaho counties in lieu of 
transfer payments under the Secure Rural Schools program.
    We support reauthorization of the SRS program in 2011 as it is 
immediately essential to the funding of county government school and 
road programs throughout the country. However, as part of that 
reauthorization we are specifically proposing the Congress include 
legislation to establish a Community Forest Trust pilot project in 
Idaho. The pilot project will demonstrate the opportunity for the 
Community Forest Trust to provide a far superior alternative to the SRS 
federal transfer payments. Additionally, revenues generated from the 
Community Forest Trust pilot project would quickly begin to offset some 
of the federal government transfer payments under the SRS program, and 
thereby help immediately to partially reduce the impact to the federal 
treasury for SRS payments.
    We have developed the Community Forest Trust concept from our 
combined experience with local government and natural resource 
management, and with considered and ongoing input from natural resource 
management professionals. Each of our counties has voted formally in 
public meetings to embrace the Community Forest Trust concept for Idaho 
and to seek authorizing legislation from the U.S. Congress.
    We do appreciate the federal government's long standing obligation 
of support for counties with significant quantities of federal land. 
Congress has recognized, and we completely concur, that there must be a 
federal mechanism for contributing funds to local government where 
federal lands are not available for the local government tax base. The 
federal transfer payments of the SRS program have been essential for 
the last several years to maintaining threshold county government 
services for schools, roads, and public safety. However, the continuous 
uncertainty over whether the SRS program will continue and if so at 
what level, does not provide for stability, and makes it impossible for 
our counties to develop long term plans. We also believe the federal 
deficit is a significant problem for our entire country and a primary 
threat to our national security. The Community Forest Trust will help 
address these paramount issues. Additionally, the Community Forest 
Trust has the opportunity to stimulate increased economic development 
and employment in our rural communities, and facilitate efficient 
prioritized treatments of unhealthy forests with high risk of fire and 
disease. These are priorities we also share with the U.S. Congress.
Community Forest Trust
    Our proposal for a Community Forest Trust is described in detail in 
the attached concept paper. Basically the idea is for a Community 
Forest Trust to be designated by Congress from federal forest lands 
within Idaho and further for Congress to provide those lands be managed 
in trust by the state for the benefit of county governments and local 
communities. Professional forest management would be provided by the 
Idaho Department of Lands under the environmental laws as they apply to 
all Idaho state forest trust lands. Proceeds from management of the 
Community Forest Trust would be distributed to counties receiving 
Secure Rural Schools funding in lieu of transfer payments from the 
federal treasury, after having first reimbursed the Idaho Department of 
Lands for land management costs. Management of the Community Forest 
Trust would be overseen by an Idaho Community Forest Trust Board 
consisting of five elected county commissioners from the counties with 
the most significant proportion of federal forest land within the 
state.
    The Community Forest Trust would be required to be managed 
sustainably and with multi-stakeholder input and environmental 
monitoring. Each of our counties is actively engaged in multi-interest 
collaborative discussions on federal lands management projects. We 
would build on these relationships to solicit input to help shape 
management plans and projects for the Community Forest.
    We are not proposing any transfer of ownership of the Community 
Forest Trust lands. They would remain in federal ownership and open to 
public access and use for all Americans. We are proposing transfer of 
management authority for the resources on the designated Community 
Forest Trust land for the defined purpose of supporting rural counties 
under the processes described herein.
Pilot Project
    To demonstrate the benefits of the Community Forest Trust, we are 
proposing a 200,000-acre Idaho pilot project be initially and 
immediately approved by Congress, located in management blocks 
throughout the forested region of the state. This is a small pilot 
including less than 1% of the 20 million acres of national forest land 
in Idaho. While it is unreasonable to expect a pilot of this small size 
to fully offset established levels of SRS transfer payments, it is 
sufficiently sized to prove and fine-tune the Community Forest Trust 
model and, once functioning, we believe has the potential to generate 
up to $15 million annually to offset federal SRS transfer payments to 
Idaho counties.
[GRAPHIC] [TIFF OMITTED] 67404.010

.eps[GRAPHIC] [TIFF OMITTED] 67404.011

.eps[GRAPHIC] [TIFF OMITTED] 67404.012

.epsConclusion
    We are committed to advancing this concept and very much appreciate 
the opportunity to present this statement for the Committee record. We 
look forward to further discussions with the Committee to move this 
Community Forest Pilot Project forward.

                                 
