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Federal Forest Resource Coalition Weekly Report for Friday, May 21, 2021

By Bill Imbergamo, FFRC Executive Director. Quote of the Week: “To the extent that we’re concerned about atmospheric carbon inputs and the role that forests can play, I don’t think that anyone would call what’s happened in our National Forests a success.” – Ben Wudtke, Thursday, May 20th, Before the Senate Energy & Natural Resources Committee

Harrell Named Deputy Undersecretary for Natural Resources: Meryl Harrell was named Deputy Under Secretary for Natural Resources and Environment (NRE) at USDA on Wednesday. She starts in the position on Monday, May 24th. The Deputy Under Secretary position is the 2nd highest ranking political appointee overseeing the Forest Service, and doesn’t require Senate confirmation.

Harrell, an 8-year veteran of the NRE office during the Obama Administration, most recently served as the Executive Director of the Southern Appalachian Wilderness Stewards. During the Obama-Biden Administration, Harrell served in several roles in the Natural Resources office, including staff assistant, Chief of Staff, and then Senior Advisor to the Under Secretary. Harrell previously worked on public lands issues at The Wilderness Society in Washington, D.C.

Harrell received her J.D. from the Yale Law School, where she studied environmental law, and graduated magna cum laude with an A.B. in geosciences and environmental studies from Princeton University. Originally from New Jersey and more recently based in Atlanta, Georgia, Harrell can often be found out on the trails in our national forests with her husband and two children.

“The leadership and expertise of Meryl will play an integral role in USDA’s efforts to provide personnel, science, and technology that will lead to better-informed and more effective land management decisions; partnerships to address climate adaptation, conservation, and ecological resilience; and clean energy technology and infrastructure,” said Agriculture Secretary Tom Vilsack. “We are fortunate to have her on our team.”

While rumors of potential Under Secretary nominees abound, there is no timeline for announcing a candidate for that post, which requires a Senate confirmation vote. The Deputy Under Secretary post has been filled by Forest Service Deputy Chief Chris French on an acting basis since January 20th. French is expected to report back to the Forest Service next week.

Most recent Administrations have strived to have an Under Secretary in place prior to the 4th of July recess. The Obama Administration’s initial nominee, Mississippi State Conservationist Homer Lee Wilkes, withdrew his name from consideration before he had a hearing. Their initial Under Secretary was confirmed in September of 2009. The Trump Administration didn’t nominate Jim Hubbard for the NRE job until April of 2018, almost 18 months into the President’s term.

Forestry Takes Center Stage at Two Senate Hearings: Intermountain Forest Association’s Ben Wudtke Testifies Before Energy Panel: Two Senate Committees (Agriculture and Energy & Natural Resources) which frequently jostle for jurisdiction over the Forest Service held competing hearings on forestry Thursday. Both panels heard that forests – including the National Forests – can play a big role in reducing atmospheric carbon if they are managed well.

At the Energy Committee, Chairman Joe Manchin (D-WV) said “it is critical that we include forests and wildfires in our conversations about carbon emissions. Our committee has talked at length about how many of our forests are unhealthy and in need of restoration,” noting that in many Western states, forests have transitioned from being carbon sinks into becoming carbon sources. “Scientists are telling us that if we proactively manage our forests, we can not only prevent emissions from wildfires, we can also increase the amount of carbon we are sequestering and storing now.”

Ranking Member John Barrasso (R-WY) noted the “the lack of active management has turned many of our nation’s forests into tinderboxes.” Conditions have created a “perfect storm” that has led to fires like the 175,000-acre Mullen fire in Wyoming last fall. Failure of the Forest Service to sell current Forest Plan timber goals “is going to lead to more timber mills closing down,” Barrasso said, citing the recent closure of the Hill City, South Dakota sawmill.

FFRC Policy Committee Member Ben Wudtke testified before the energy panel, saying the National Forests are “not meeting their full potential to sequester and store carbon” Forest management, he said, must “both proactive and reactive”, including thinning and reducing fuel loads, and helping forest recover following disturbances. He noted that while funding for hazardous fuels reduction has increased, the “Forest Service is only able to treat a fraction of the acres needed” to reduce fire risks.

New Mexico Sen. Martin Heinrich (D) asked Wudtke about the role of prescribed fire, and Wudtke noted that “the same conditions that cause catastrophic burning during wildfire seasons” prevent reintroduction of fire “until you’ve gone in and created stand conditions that allow you to use that safely.” “Fire can be used as a maintenance tool” once the stand is thinned, “but it’s very difficult to go in and use prescribed fire as a first step in any treatment plan.”

Wudtke noted that “Deforestation by wildfire is the leading cause of the growing reforestation backlog on the National Forests,” which was made worse by the 2020 Fire season. He noted that reforestation is time sensitive – since many areas regenerate to brush rather than trees. Prompt salvage, he said “can contribute to reforestation success, and should be part of an overall reforestation strategy.” Wudtke noted that large trees store larger amounts of carbon, but that the 2020 fire season demonstrated “that forests do not store carbon indefinitely.” He noted that companies can help the forest service manage lands, “while bringing needed lumber to consumers.”

Manchin asked whether there were examples of the Forest Service preparing environmental analysis before disturbances strike – a policy FFRC has long advocated for. Wudtke noted a “few isolated examples” but said “for the most part, it’s been reactive.” He noted that treatments have to be “done at landscape scales, thinking about the forests as a whole, rather than isolated slices around communities.”

Sen. Steve Daines (R-MT) said that “Mills were generally able to keep operating throughout the year,” in Montana, but that “lumber production actually decreased” in the state in 2020. “What constraints does the timber industry face in its ability to invest in capacity?” Wudtke noted that large wood using facilities represent very large capital commitments, “and in the West, where we rely on Federal lands, it’s very difficult” to get the kind of certainty of supply needed for those investments.

National Forest Foundation President Mary Mitsos testified that outside partners always ask if they can get carbon credits for helping to bankroll management projects on National Forests, and that the Foundation does not currently have the authority to issue those credits. If that were allowed, she said, "it would be a game changer for restoring our forests."

Jennifer Cover of WoodWorks told the committee that mass timber “is an incredibly effective carbon mitigation tool” and cited new changes to building codes allowing mass timber construction of buildings up to 18 stories tall. She noted that in addition to storing carbon, wood products manufacturing uses a significant amount of renewable energy and is less energy intensive that non-renewable substitutes.

Sen. Ron Wyden (D-OR) falsely asserted that “one side wants to cut everything down” (while accurately noting the existence of zero cut activists), but said that “it would be absolute malpractice for this committee and this Congress not to take concrete steps to reduce hazardous fuels loads,” before lauding his own bill which would require massive increases in prescribed fires (whether the landscape is ready for them or not).

“I think it’s clear today that what we’ve been doing for the last couple of decades isn’t working; the lack of forest management, the lack of reducing fuels and insect risk on the landscape is not helping us now…” Wudtke said. “To the extent that we’re concerned about atmospheric carbon inputs and the role that forests can play, I don’t think that anyone would call what’s happened in our National Forests a success.”

You can watch an archived webcast of the hearing and read the written testimony at this link. A copy of Ben’s testimony is attached to this week’s report.

At the Agriculture Committee, a group of mostly private land oriented witnesses addressed the needs for increased management, and reforestation on both public and private lands. Chairwoman Debbie Stabenow (D-MI) noted that she and other committee members have introduced bills to help landowners receive carbon credits and to encourage reforestation on both public and private lands.

We also have to invest in our national forests, both in replanting stands that have been affected by wildfire and insect outbreaks, and in pursuing science-based restoration of our public lands to help prevent wildfires in the first place,” she noted. :Senator Bennet, who chairs our Forestry subcommittee – and whose beautiful home state of Colorado last year saw some of its worst wildfires in recent history – is leading a bill on this, and I look forward to working with you, Senator Bennet.”

“The good news is, we have an abundance of the world’s greatest carbon sequestration machines – trees,” Ranking Member John Boozman (R-AR) said. He called the lifecycle of planting trees, managing forests, harvesting timber and delivering this commodity to a vibrant wood products industry a “win-win for everyone.” Managing forests “minimizes damage from pests, disease and catastrophic wildfires; supports a vibrant wood products industry and the rural communities which rely on it for their livelihood; and environmentally advantageous byproducts of cleaner air and water in addition to carbon sequestration.”

“The common denominator in achieving these wins is management. Providing forestry experts the right tools yields us healthy forests, healthy markets and countless benefits,” Boozman said.

Dr. Tony Cheng of Colorado State University told the panel that “the pace of climate change may be outpacing forests’ natural capacity to recover from disturbances. A growing body of scientific evidence is showing that, in many places, forests are not regenerating some 20 or more years after wildfires.” Cheng said this “is due in part to the size and severity of wildfires, but also to climatic conditions no longer conducive to trees being able to establish and grow after fires. Forest recovery could take centuries, if at all. In the meantime, this green infrastructure to mitigate climate change has been lost.” He also asserted that “divestment” of resources to the Forest Service has limited “the human capital needed” to increase the pace and scale of management.

Arkansas State Forester Joe Fox said “Active forest management, supported by forest markets, combined with coordinated wildfire prevention, mitigation, and suppression efforts can substantially mitigate the effects of climate change... Without active management, forests are less resilient to climate change and less effective at sequestering carbon.”

You can watch the Agriculture hearing and read the written testimony here.

Smith-Currie’s Scott: Federal Contractor Minimum Wage of $15.00 Includes Some Forestry Contracts: On April 27, 2021, President Biden issued Executive Order 14026 – Increasing the Minimum Wage for Federal Contractors, which sets the minimum wage for federal contractors at $15.00 starting in 2022. The order applies to “workers working on or in connection with a Federal Government contract” making it widely applicable. “Raising the minimum wage enhances worker productivity and generates higher-quality work by boosting workers’ health, morale, and effort; reducing absenteeism and turnover; and lowering supervisory and training costs,” according to the order.

Although technically effective immediately, for practical purposes the order will kick in on January 30, 2022. After that date, federal agencies are instructed to “ensure that contracts and contract-like instruments” set the minimum hourly rate at $15.00, and that rate is to be increased by the percentage increase in the Consumer Price Index starting in January 2023. If any federal, state, or local law requires a wage higher than $15.00, employers must pay the higher wage.

The applicability of Executive Order to forestry contracts appears mixed. While the Secretary of Labor may provide some clarity with the forthcoming regulations issued under EO 14026, some of the trickier questions might not be resolved until the issues end up in court.

Timber sale contracts, which are executive agency contracts subject to the Contract Disputes Act (“CDA”), are not procurement contracts. They are not subject to the Service Contract Act (“SCA”), they are not concessions contracts, and they are not contracts for providing services to federal employees or the general public. As a result, a strict reading of EO 14026 indicates that timber sale contracts will not be subject to the new minimum wage requirement.

However, the term “contract or contract-like instrument” as used by the Secretary of Labor in existing regulations includes “any contract that may be covered under any Federal procurement statute.” The United States Court of Federal Claims has held that a timber sale contract falls under the CDA. It is not difficult to imagine that the government may assert that a timber sale contract is a procurement contract subject to the wage increase. If not resolved by the regulations and definitions to be issued by the Secretary of Labor later this year, the answer may well come out in litigation.

The same analysis generally applies to Integrated Resource Timber Contracts (IRTCs) as to timber sale contracts, because the value of timber removed is expected to exceed the value of services provided to the government. The question remains whether an IRTC is a procurement for purposes of the order. The government procures services under Integrated Resource Service Contracts (IRSCs) and the contracts are subject to the Service Contract Act. As a result, IRSCs will be subject to the minimum $15 an hour wage in the Executive Order.

Much like timber sale contracts, the Forest Service does not consider Stewardship Agreements to be procurements. Unlike timber sale contracts, however, the government exchanges timber for services, which looks very much like a procurement of services when the value of services received exceeds the value of timber removed and the government subsequently pays cash for the services. Like timber sale contracts, whether Stewardship Agreements are subject to EO 14026 might only be answered in litigation. While contracts issued under Stewardship Agreements are not federal contracts, they will be subject to EO 14026 in the same manner as the Stewardship Agreements, because the order applies to all “workers working on or in connection with a Federal Government contract….”

While Stewardship Agreements are not subject to the SCA or the Davis-Bacon Act, a private party engaged in a Stewardship Agreement (or a timber sale contract or an IRTC) with the government is likely to be covered by the Fair Labor Standards Act (FLSA). The FLSA exempts logging operations with no more than eight employees, but other timber operators covered by the FLSA must abide by its minimum wage and maximum hour requirements. As a result, it is possible that Stewardship Agreements will be subject to EO 14026.

These analyses may be clarified when the Secretary of Labor issues regulations, including definitions of terms such as “contract or contract-like instrument,” later this year. For more information, please feel free to contact Jake Scott at Smith, Currie, & Hancock via email.

USDA Announces “Progress Report” on Climate Smart Policies: The Department of Agriculture released a 90-day “Progress Report” on “Climate Smart” policies on Thursday, May 20th. In a news release, the Department said the report “represents an important step foward in President Biden’s Executive Order on Tackling the Climate Crisis at Home and Abroad and shift towards a whole-of-department approach to climate solutions.

The report says that meeting the “carbon potential” from forests “will require integrating climate considerations throughout forestry-related programs and practices in USDA.” The report names several “core actions” including; “fuels reduction, climate-informed reforestation and forest management.” “Maintaining the health and integrity of America’s forests is vital to protecting their carbon sequestration potential, including conserving old-growth forests from wildfire and other threats, ensuring proper forest regeneration after fire and other disturbance, and ensuring that forests are resilient across large landscapes.”

The report goes on to cite the Forest Service’s inflated “acres treated” number of over 2.5 million acres (which includes esoteric, non-forestry activities like weed control and water quality projects on lakes), but acknowledges that “Forest Service and other research scientists have determined that this current level of treatment is not enough to keep pace with the scale and scope of the wildfire problem.” To be effective, “USDA must increase the scale of its actions by two to four times more than is currently treated.”

“With the right tools and partnerships, American agriculture and forestry can lead the world in solutions that will increase climate resilience, sequester carbon, enhance agricultural productivity, and maintain critical environmental benefits,” said Agriculture Secretary Vilsack. “At this pivotal time, President Biden has called upon USDA to develop a strategy for climate smart agriculture and forestry as part of a whole-of-government effort to addressing the climate crisis.”

If you are having difficulty sleeping, you can access the entire report at this link.

The Week Ahead: The Biden Administration is expected to formally release the detailed FY 2022 Forest Service budget proposal by Thursday or Friday of next week.

The Senate Interior Appropriations Subcommittee (which writes the Forest Service budget bill each year) will hold a hearing on the FY 2022 budget proposal at last one day before the budget is actually released, on Wednesday, May 26th. Chief Vicki Christiansen is the witness.

Also on Wednesday, the Senate Energy Committee will hold a hearing on the State of the National Park System, at 10 AM.

On Thursday, May 27th, the Senate Agriculture panel will hold a confirmation hearing for Jamie Hipp to serve as General Counsel for the Department of Agriculture.

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