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of the Sequoia for many years. It is a classic example of the inability of 

 the Forest Service to keep a firm in business. When it operated the Forest 

 Service appraisals showed log hauls of from 1 to 30 miles, averaging around 

 15 miles. Later appraisals were to Inyokern on the East side of the Forest, 

 where Louisiana-Pacific had a mill, distances of 40 -45 miles, as well as to 

 Terra Bella some 50-75 miles to the West of the Forest, where Sierra 

 Pacific's mill is, with a few appraised with log hauls even to Redlands, 175 

 miles away. The Forest Service uses log haul distances to the mill it 

 considers most likely will get the sale, not necessarily the nearest mill or 

 the mill in a community it thinks it is sustaining. With log haul costs in 

 the Sl.OO/mi/MBF range, adding 25 miles to this cost reduces Advertised Rates 

 by this amount.. All other things being a mill nearer the timber has this much 

 advantage in bidding. 



* 



Mt. Whi'tney bought Sequoia Forest timber for years under sealed bids, 

 paying the low appraised price, or a bit more. It had the advantage of 

 "position", being located near tlie timber. In 1955 the American Timber Co. 

 submitted a sealed bid for a 45 million board foot sale that was a few cents 

 higher than Mt . Whitney's. This sale was in Mt. Whitney's ''back yard". To 

 assure that Mt. Whitney would never be surprised by a sealed bid, the initial 

 and later Kern Plateau sales used oral auctions. When there are large well- 

 financed firms oral auctions permit them to dominate the Forest market. The 

 record on the Kern Plateau sales suggests this has been the case. 



Mt. Whitney later bought out American taking over the 45 MMBF sale it 

 had lost. None of the efforts by the Forest Service to sustain Mt. Whitney at 

 Johnsondale succeeded. 



As you are told about the need to keep the Sequoia timber flowing to 

 support communities, even though it requires a large taxpayer supported 

 subsidy, keep in mind the saga of Mt. Whitney and American Timber companies. 

 Now most of the timber purchased goes to mills well outside the Forest. The 

 agency still has not found a way under our system of competitive enterprise 

 to keep private firms employing workers and operating when they decide it is 

 not profitable. 



OTHER ASPECTS 



1. Management Plan, Sec 7(d), page 13. 



The bill calls for a Plan to be published within 2 years. The bill needs 

 to be examined to assure that other directions that should be in the Plan 

 aren't triggered to be started before the Plan is adopted. 



2. Roads and Trails, Sec. 7(e), pages 14-15. 



The direction to determine the road network and its use makes sense. 

 Whether there should be a flat prohibition on any further roads should be 

 deferred until the Plan is adopted. Some minor shifts as well as new roads 

 may be desirable, which the bill language would prevent. The Service does not 

 publish data by Forest on the road system by class of road and maintenance 

 and use status. One approach would be to maintain all current Arterial and 



