- The Washington Times - Tuesday, December 15, 2009

RESERVE, N.M.

A federal program that began as a safety net for Pacific Northwest logging communities hard hit by battles over the spotted owl in the 1990s has morphed into a sprawling entitlement — one that ships vast amounts of money to states with little or no historic connection to timber, an analysis by Associated Press shows.

Nicknamed “county payments,” the timber program was supposed to assist counties shortchanged when national forests limited logging to protect the Northern spotted owl and other endangered species.

Since becoming law in 2000, the program has distributed more than $3 billion to 700 counties in 41 states with national forests and helped fund everything from schools to libraries to jails.

The federal largesse initially focused on a handful of Western states, with Oregon alone receiving nearly $2 billion.

Spending of that magnitude, though, sparked a new timber war — this one among politicians eager to get their hands on some of the logging money.

A four-year renewal of the law, passed last year, authorizes an additional $1.6 billion for the program through 2011 and shifts substantial sums to states where the spotted owl never flew. While money initially was based on historic logging levels, now any state with federal forests — even with no history of logging — is eligible for millions in Forest Service dollars.

Doling out all that taxpayer money is based less on logging losses than on the powerful reality of political clout. Senate Majority Leader Harry Reid, Nevada Democrat, is among the program’s strongest backers.

The biggest winner under the renewal is, in fact, Nevada, where payments jumped by 1,132 percent. Mr. Reid called the timber program a personal priority that supports “the lifeblood of communities all across America, and particularly in the West.”

Critics of the program do not see it through that patriotic lens. Steve Ellis, vice president of Taxpayers for Common Sense, a watchdog group, called it “the ultimate political logroll,” an irrational subsidy program that serves up cash bonuses for states with forestland.

“When you are staring down the barrel of a $1.4 trillion budget deficit, it’s deals like this that got us into that mess,” Mr. Ellis said.

But a quiet move already is afoot to renew county payments beyond 2011.

“Letting county payments end after 2011 would leave gaping holes in county budgets,” said Oregon’s new Democratic senator, Jeff Merkley. “We can’t let that happen.”

Here in Catron County, the part of western New Mexico where Butch Cassidy and his Wild Bunch once holed up, the program distributes the highest per capita payment in the nation — $1,883 per person.

Pioneers settled this remote frontier town more than a century ago to log ponderosa pine. By the late 1980s, timber production had dwindled, and in 1990, the town’s sole remaining mill shut down.

The county, which sits along the Arizona border, is larger than three Eastern states but has fewer than 3,500 residents. The public high school in Reserve, the county seat, has just five seniors. The handful of businesses lining Main Street close early each evening, save for a quiet bar frequented by a few locals.

“We have more elk than we do people,” said longtime resident Jim Kellar.

Much more important to note: New Mexico’s two senators served as chairman and ranking Republican on the Senate committee that rewrote the timber payments formula.

New Mexico’s increase under the new formula was 692 percent.

The original timber payments law, formally known as the Secure Rural Schools and Community Self-Determination Act, was the result of years of effort by Northwestern lawmakers, primarily Sen. Ron Wyden, Oregon Democrat, and former Sen. Larry Craig, Idaho Republican. Eager to plug a budget gap caused by the timber industry’s steep decline, Mr. Wyden and Mr. Craig created a substitute revenue stream to pay rural counties that no longer could depend on revenue from logging in federal forests.

Five Western states — Oregon, California, Washington, Idaho and Montana — pocketed more than 80 percent of the total timber payments from 2000 to 2007. All are traditional timber producers where huge swaths of land are owned by the federal government.

Many Oregon counties have received more money annually from county payments than from timber sales during all but the peak logging years of the late 1980s.

Under the renewal, included as a sweetener in the $700 billion financial bailout program, the five Western states saw their share of the timber money drop to about 62 percent in the first year, with further drops scheduled in each of the next three years.

The reason? Politics.

Mr. Reid was among four powerful Western Democrats who shepherded the new timber law, which he and others have touted as an accomplishment of the Democratic-led Congress. Other key backers include Mr. Wyden and Sens. Jeff Bingaman, New Mexico Democrat, and Max Baucus, Montana Democrat. Mr. Bingaman chairs the Senate Energy and Natural Resources Committee, while Mr. Baucus heads the Senate Finance Committee.

Mr. Baucus boasted that he “led the charge” to renew the timber program, which he called a vital lifeline to his rural state. The new formula more than doubles payments to Montana and will bring an estimated $111 million to the state over four years.

“Without the dollars the program provides, rural schools, roadways and even emergency services would be woefully underfunded,” Mr. Baucus said.

Other states that benefit from the change include Utah, which received a 636 percent increase; Alaska (528 percent); Kentucky (303 percent); Tennessee (188 percent); Colorado (184 percent); North Carolina and Virginia (150 percent each).

Senate Minority Leader Mitch McConnell, Kentucky Republican, was an early backer of the law and provided political cover for Republicans to support it. North Carolina Sen. Richard Burr, until this year the top Republican on the forestry subcommittee, frequently complained that Oregon got too much of the money under the original timber program.

Timber was harvested in some of these states in the 1980s — the basis for the original spending formula — but at far lower levels than the Pacific Northwest, where timber was king. The new formula, however, takes into account national forest acreage in each state and county, regardless of historical timber production, and includes an adjustment based on per capita income and other factors.

Individual counties also received huge increases:

• Nevada’s Clark County, renowned for its sinful desert attraction, Las Vegas, saw an 841 percent increase in timber money, to $226,000 this year. That nearly equals timber receipts from the county’s tiny portion of the Humboldt-Toiyabe National Forest over two decades.

• Timber harvests in Kentucky’s Daniel Boone National Forest have been modest in recent decades - ranging from $7,600 to $77,000 annually - but Clay County, Ky., which includes part of the forest, received $338,510 this year from the timber program, a 341 percent increase.

Mr. Bingaman defended the changes.

“Frankly we had to broaden the program in order to get the support to go ahead and do a reauthorization, and that’s exactly what we did,” he said in an interview.

In Catron County, residents said the additional money is overdue and badly needed. The county got about $6.5 million this year, up from $735,000 under the old law — a 779 percent increase. More than 70 percent of land in the county is owned by the federal government.

Residents say efforts to limit grazing and logging on federal land to protect endangered species such as the Mexican spotted owl, a relative of the Northern spotted owl, hurt their way of life.

Since the early 1990s, after the mill closure put 175 people out of work, the high school here has lost 100 students and many programs. About 23 percent of county residents live below the poverty level, and a school bond measure hasn’t passed since 1989.

“We are a very economically depressed community,” said Jim Kellar, 58, who has taken over the shuttered timber mill with a partner in hopes of re-sparking the industry. K&B; Timberworks Inc. now has multiple contracts for ponderosa pine beams, but Kellar said the mill’s future depends on federal contracts to thin the forest for wildfire prevention - funded in part by the Secure Rural Schools law.

“Could we exist without it? Yes. It would be difficult, though,” Kellar said.

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