A state timber bill envisioned as a helping hand for embattled Viking Lumber is advancing toward a final vote.
On Monday afternoon, the House Resources Committee approved Senate Bill 32, which expands the ability of the Alaska Division of Forestry to offer negotiated timber sales in state forests. Existing law prohibits the division from selling large amounts of timber without a competitive bid process unless the forested area has a high unemployment rate.
The bill now goes to the House Finance Committee for approval. If it earns an OK, it will head to a vote of the full House and on to Gov. Bill Walker, who introduced the bill in January 2015.
Before advancing the bill, committee members amended it to require 25 percent of proceeds from a sale be spent on local division activities.
Speaking to the committee on Monday, State Forester Chris Maisch told lawmakers that the bill would improve the state’s ability to consider jobs, not just revenue.
“It’s very important for Southeast Alaska,” he said.
In Southeast Alaska, Viking Lumber is the last remaining mid-sized sawmill. The vast majority of timber in Southeast is cut for export to foreign sawmills, where lower labor costs result in cheaper lumber.
“In Southeast Alaska, a competitive sale is almost guaranteed to go export,” Maisch said.
With the federal government not expected to sell any new timber in the next two years, Maisch said Viking Lumber might be forced to shut down for lack of raw material.
That can be averted if the state steps in and sells timber directly. Speaking in an interview after talking to lawmakers, Maisch said the state would earn about 20 percent to 33 percent less revenue by selling to Viking directly and not in a competitive bid. The precise amount will be determined by the type of timber, timber grade and amount sold.
In return, Viking – and the 150 direct and indirect jobs created by the mill – have a greater chance of sticking around.
According to figures provided by Rain Coast Data, Southeast Alaska had 3,543 timber-related jobs in 1991. In 2015, that figure was just 328, the lowest mark since 1890.
The bill is not restricted to Viking Timber or Southeast Alaska, but it has limited application outside the region, which faces competitive pressures and surviving local sawmills, circumstances uncommon elsewhere in Alaska.
“I don’t think this would get used a lot, but when it is used, it would be really helpful,” said Owen Graham, executive director of the Alaska Forest Association.
Maisch said three sales under the new standard are pending in Southeast Alaska to Viking. The Southeast State Forest encompasses 50,000 acres in southern Southeast.
Support for the bill was not universal. Speaking by phone from Petersburg, Dave Beebe and Rebecca Knight, raised concerns about whether the Division of Forestry has the ability to monitor and appropriately vet a noncompetitive sale. Both are members of the Greater Southeast Alaska Conservation Community but were speaking on their own behalf.
Rep. Andy Josephson, D-Anchorage, also asked what effect the sales might have on a cruise ship passenger sailing by the coast.
Maisch said that will vary depending on the location.
“I think the economic benefit is greater to tourism, commercial fishing, ecotourism and sportfishing,” Josephson said. “We don’t necessarily need to subsidize a few hundred jobs.”
Editor’s Note: This story has been edited to clarify that Knight and Beebe were not speaking on behalf of GSACC.
