no 



frilsi;ik(!s. Wc have iKjthliiji lo hide (rorri Ihe regulators, this CommiUee, or our 

 coniiiiunlly. 



Conclusion 



A 15-y(;ar exleiislori with the revisions outlined herein and at the current average 

 aiiiMial ()llriliij» level of 192.5 MMBF per year, should be sufficient for us lo properly 

 amortize our caiillal rcrqulrerrients and allow us to continue to provide a reasonable 

 rchirn on invcslmciil lo our shareholders and to provide economic stability for the 

 Ketchikan ar(;a. This exleiislon period Is well wllhln industry norms for borrowing the 

 $200 Miilllon wc will need. The need for an extension was recognized In the terms of 

 (he original (ontracl. which stal(!d the Forest Service Intention lo establish "the 

 opuralloM ol the Industry on a commercially sound and permanently economical basis" 

 and "lo aflord an opportunity lo purchase supplies of limber for permanent operation 

 ..." riic existing long-term contract, therefore, presupposes a perpetual arrangement 

 between Kl'C and the Foresl Service for limber supply. 



The holloMi line is: if S. 1877 and II. R. 3G59 do not become law. KPC and its 

 (•mi)l()yces are at risk and lac e an uncertain future. We face decisions in 1996 that 

 cannot he put oil inlo the future. These decisions must be made this year. 



Kl'C has met Us contractual obligation to develop the economy and provide 

 perui.uu-nl. year round emijloyment for southern southeast Alaska. We want the 

 government lo meet Its contractual obligation lo provide a sufficient volume of 



Page 22 



