[House Report 104-761]
[From the U.S. Government Publishing Office]
104th Congress Rept. 104-761
HOUSE OF REPRESENTATIVES
2d Session Part 1
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ELKHORN RIDGE TIMBER SALE
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September 4, 1996.--Ordered to be printed
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Mr. Young of Alaska, from the Committee on Resources, submitted the
following
R E P O R T
[To accompany H.R. 2711]
[Including cost estimate of the Congressional Budget Office]
The Committee on Resources, to whom was referred the bill
(H.R. 2711) to provide for the substitution of timber for the
canceled Elkhorn Ridge Timber Sale, having considered the same,
report favorably thereon without amendment and recommend that
the bill do pass.
purpose of the bill
The purpose of H.R. 2711 is to provide for the substitution
of timber for the canceled Elkhorn Ridge Timber Sale.
background and need for legislation
In October 1987, the Bureau of Land Management (BLM) sold
3.8 million board feet of timber within the Elkhorn Ridge area
in Mendocino County near Laytonville, California. As the result
of a lawsuit filed with the Federal District Court in 1989 by
the Sierra Club, the BLM reassessed the impacts of the sale on
the area's wild and scenic river corridor, the northern spotted
owl, marbled murrelet and the at-risk coho salmon, currently
petitioned for Federal listing under the Endangered Species
Act. Public comment received on two BLM environmental impact
statements overwhelmingly recommended that the timber sale
contract be terminated.
The Elkhorn Ridge sale site lies within the South Fork Eel
River Management Area, containing 17,200 acres of public lands
in Mendocino County near the South Fork Eel River. The River
has been identified as a ``Tier 1 Key Watershed'' in the
President's Northwest Forest Plan. The purpose of the
designation is to maintain existing native anadromous fish
stocks until habitat conditions can be improved and to identify
the watershed as having the highest potential and priority for
restoration.
Based on these considerations, the BLM signed a record of
decision on May 27, 1994, stopping the harvest of the timber
sale. Eel River Sawmills filed a claim under the Contract
Disputes Act for resolution of the Elkhorn Ridge timber sale
contract, seeking damages of $2.4 million. On October 21, 1994,
BLM notified Eel River Sawmills that the contract was
terminated. BLM offered a profit-only settlement which was
rejected by Eel River.
The BLM's preferred option in resolving the timber contract
is to substitute timber from less environmentally sensitive
areas in the region. BLM has identified three suitable sale
areas which would be nearly equal in value to the Elkhorn
timber sale. These are: Sheridan/Carr Creek near Weaverville;
Powerline northwest of Deadwood; and Deadwood, between Deadwood
and Lewiston; all in Trinity County, California. BLM's Regional
and the Department of the Interior Solicitors have concurred in
BLM's determination that such a substitute would be in the
public interest and the most suitable resolution to this legal
dispute.
committee action
H.R. 2711 was introduced on December 5, 1995, by
Congressman Frank Riggs (R-CA). The bill was referred to the
Committee on Agriculture and additionally to the Committee on
Resources. Within the Committee on Resources, the bill was
referred to the Subcommittee on National Parks, Forests and
Lands. On May 30, 1996, the Subcommittee held a hearing on H.R.
2711, where Mr. Matt Millenbach, Deputy Director of the BLM,
testified in support of the legislation. On June 27, 1996, the
Subcommittee met to mark up H.R. 2711. The bill was ordered
favorably reported to the Full Committee by voice vote without
amendment. On July 17, 1996, the Full Resources Committee met
to consider H.R. 2711. The bill was ordered favorably reported
to the House of Representatives by voice vote without amendment
in the presence of a quorum.
section-by-section analysis
Section 1. Substitution of timber for canceled timber sale
Section 1 authorizes the BLM to substitute, without
competition, a contract for timber identified for harvest
located on public lands administered by the BLM in the State of
California of comparable value for the following terminated
timber contract: Elkhorn Ridge Timber Sale, Contract No. CA-
050-TS-88-01. Nothing in this section shall be construed to
change any law or policy beyond the specified timber sale
substitution.
committee oversight findings and recommendations
With respect to the requirements of clause 2(l)(3) of rule
XI of the Rules of the House of Representatives, and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee on Resources' oversight findings and
recommendations are reflected in the body of this report.
inflationary impact statement
Pursuant to clause 2(l)(4) of rule XI of the Rules of the
House of Representatives, the Committee estimates that the
enactment of H.R. 2711 will have no significant inflationary
impact on prices and costs in the operation of the national
economy.
cost of the legislation
Clause 7(a) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison by the
Committee of the costs which would be incurred in carrying out
H.R. 2711. However, clause 7(d) of that rule provides that this
requirement does not apply when the Committee has included in
its report a timely submitted cost estimate of the bill
prepared by the Director of the Congressional Budget Office
under section 403 of the Congressional Budget Act of 1974.
compliance with house rule xi
1. With respect to the requirement of clause 2(l)(3)(B) of
rule XI of the Rules of the House of Representatives and
section 308(a) of the Congressional Budget Act of 1974, H.R.
2711 does not contain any new budget authority, spending
authority, credit authority, or an increase or decrease in tax
expenditures. Enactment of H.R. 2711 would result in a loss of
offsetting receipts to the Federal Government of approximately
$2 million. However, the bill could also result in a savings to
the Federal Government by eliminating the need to pay for the
canceled timber contract.
2. With respect to the requirement of clause 2(l)(3)(D) of
rule XI of the Rules of the House of Representatives, the
Committee has received no report of oversight findings and
recommendations from the Committee on Government Reform and
Oversight on the subject of H.R. 2711.
3. With respect to the requirement of clause 2(l)(3)(C) of
rule XI of the Rules of the House of Representatives and
section 403 of the Congressional Budget Act of 1974, the
Committee has received the following cost estimate for H.R.
2711 from the Director of the Congressional Budget Office.
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 25, 1996.
Hon. Don Young,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
reviewed H.R. 2711, a bill to provide for the substitution of
timber for the canceled Elkhorn Ridge timber sale, as ordered
reported by the House Committee on Resources on July 17, 1996.
Enacting H.R. 2711 would affect offsetting receipts and thus
direct spending; therefore, pay-as-you-go procedures would
apply to the bill. We estimate that the increase in direct
spending would total about $2 million over the 1997-2000
period. Enacting this bill could also result in some savings to
the federal government because it would eliminate the
possibility that a court might order the government to pay
compensation for canceling the Elkhorn Ridge timber sale. CBO
cannot estimate the likelihood, extent, or timing of any such
savings, but we expect that any potential savings would not be
realized until after 1998.
H.R. 2711 would authorize the Bureau of Land Management
(BLM) to offer timber to Eel River Sawmills as a substitute for
the canceled Elkhorn Ridge timber sale. In May 1994, BLM
stopped the harvest of timber from that sale. That contract
termination could result in court proceedings to determine
whether the federal government is liable for paying
compensation to Eel River Sawmills, which had been awarded the
Elkhorn Ridge contract. The company and BLM have agreed to a
settlement whereby the agency would offer the company
substitute timber in exchange for the timber covered by the
original Elkhorn Ridge contract. Enacting H.R. 2711 would allow
BLM to fulfill that settlement agreement by awarding the
substitute timber to Eel River Sawmills at no additional cost
to the company.
By authorizing the Secretary of the Interior to provide
substitute timber that BLM would otherwise be likely to sell
through competitive bidding, this bill would probably reduce
offsetting receipts to the Treasury and thus increase federal
outlays. According to BLM, the appraised value of the proposed
substitute timber is about $2 million, which is the value that
BLM would use to set the minimum bid in a competitive bidding
process. Thus, selling the substitute timber would likely
result in a winning bid of at least that amount. Therefore, CBO
estimates that enacting H.R. 2711 would result in a loss of $2
million in offsetting receipts over the 1997-2000 period, net
of required payments to States.
At the same time, enacting this bill could result in
savings to the federal government--perhaps offsetting some or
all of the costs identified above--by eliminating the need for
compensation that a court might otherwise require the
government to pay for canceling the Elkhorn Ridge contract. CBO
cannot estimate the likelihood, magnitude, or timing of any
such compensation. Based on information from BLM, CBO expects
that any such savings would not be realized until after fiscal
year 1998. Resolving the dispute through legislation also could
reduce federal administrative costs by avoiding some litigation
expenses.
H.R. 2711 contains no private-sector or intergovernmental
mandates as defined in the Unfunded Mandates Reform Act of 1995
(Public Law 104-4). The state of California would receive 4
percent of the receipts from timber sales affected by this
bill. Because we estimate that the bill would result in lower
receipts from the timber sales, we estimate that payments to
the state would be reduced, but that any such reduction would
be less than $100,000.
If you wish further details on this estimate, we will be
pleased to provide them. The staff contacts are Victoria V.
Heid (for federal costs), and Marjorie Miller (for the state,
local, and tribal impact).
Sincerely,
June E. O'Neill, Director.
COMPLIANCE WITH PUBLIC LAW 104-4
H.R. 2711 contains no unfunded mandates.
CHANGES IN EXISTING LAW
If enacted, H.R. 2711 would make no changes in existing
law.
A P P E N D I X
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U.S. House of Representatives,
Committee on Agriculture,
Washington, DC, July 24, 1996.
Hon. Don Young,
Chairman, Committee on Resources, Longworth House Office Building,
Washington, DC.
Dear Mr. Chairman: Thank you for advising the Committee on
Agriculture that on July 17, 1996, the Committee on Resources
had ordered reported H.R. 2711, a bill to provide for the
substitution of timber for the canceled Elkhorn Ridge Timber
Sale. This Committee received primary referral of the bill.
However, in the interest of time and the circumstances of
this matter, this Committee has no objection to expediting
consideration of H.R. 2711 by the full House without
consideration by this Committee or its Subcommittee on Resource
Conservation, Research, and Forestry by waiving consideration
of the bill at this time. However, our waiver on consideration
of H.R. 2711 should not be considered as precedent for any
future referrals of similar measures relating to timber sale
substitution. Moreover, if this bill or any similar bill is
conferenced with the Senate, this Committee reserves the right
to request to be included as conferees.
As also your cooperation is appreciated.
Sincerely,
Pat Roberts, Chairman.