57 



of this rather bitter old growth, timber supply fight that has been 

 going on here in the Pacific Northwest. 



Last week our association completed a 60-page report entitled 

 "Investing in America: Intensive Management Opportunities in the 

 Pacific Northwest." I want to offer a bit of caution in there, but 

 what we did is, we looked at the possibility of increasing intensive 

 management on both public and private forest lands in the Pacific 

 Northwest, both in Oregon and Washington, and we found that 

 perhaps upwards of 7,300 jobs could either be created or main- 

 tained. These are iobs that we feel are both environmentally and 

 economically souna. 



We heard the chief of the Forest Service talk, and, in looking at 

 the new forest plans, approximately 55 percent of the acres to be 

 harvested call wr high levels of intensive management. That in- 

 cludes site preparation, tree planting, stand mainter^nce, pre-com- 

 mercial thinning, fertilization, and commercial thinning, and be- 

 cause our meml^rs are so dependent on Federal contracts we con- 

 tinually monitor the number of contracts that the Forest Service is 

 putting out. 



On page 3, we obtained data from the Forest Service projecting 

 out their reforestation needs, and then on page 4 their 

 precommercial thinning needs in Region VI for the next couple of 

 years. Briefly, there are about 100,000 acres of tree planting that 

 they are proposing as well as about 150,000 acres of thinning. 



Everybody knows that there is this line item that runs through 

 both graphs, and that is the K-V cash balance, and essentially 

 what it does is, it shows from fiscal year 1989 a cash balance of 

 $260 million; the Forest Service is estimating that that is going to 

 drop down to $95 million in fiscal year 1995. However, later on in 

 the report, just about two weeks ago we obtained from the Forest 

 Service what their K-V balances are right now and their projected 

 expenses, eind right now in Region VI they are estimating a $42.7 

 million deficit in their K-V fund. 



Now one of the things that the Forest Service is real quick to say 

 is that that is just a paper deficit and we have the authority to re- 

 compute the timber sales, and so forth and so on. However, our as- 

 sociation is quite concerned that they are not going to have the 

 funds available to do the work and a lot of this work is going to 

 get short-changed. 



I would like to just finish up quickly on the Forest Service and 

 just say that there are a couple of thoughts I have for creating 

 these intensive management forestry jobs. One is, a lot of people 

 recognize that the timber cut on the National Forest lands was too 

 high in the past and that the cut needs to be reduced. However, 

 there is also what I would call a balance, for a lack of a better 

 word, that the timber sale program does need to be restarted just 

 in part because of the tremendous loss of income that is occurring. 



We would also like to encourage the Forest Service to enter into 

 more public/private partnerships with contractors. For example, 

 what a number of our members are doing, particularly in Rep- 

 resentative Smith's district, and probably even more in the future 

 in Representative DeFazio's, is coming in, doing like precommercial 

 thinning work which now, because of the high chip prices, they can 

 actually turn around and sell that on the market. So that way, the 



