297 



other timber operators, the Forest Service, entire communities:, 

 and other forest users. 



Terminating the ^0-year contracts and replacing them with 

 normal short-term compet ive ly-bid sales will bring the Tongass 

 out of the dark ages by bringing competition and balanced 

 management to <:'ur largest national forest. 



QUESTION 4. DO YOU BELIEVE THE GOVERNMENT CAN CANCEL THE 50-YEAR 

 CONTRACTS LEGALLY' WHAT KIND OF DAMAGES WILL WE INCUR" 



Yes. we believe the government can legally cancel the 

 contracts . 



Government liability for termination is quite limited, as 

 shown in Hedstrom Lumber v. United States . 7 CI . Ct . 16 (1984). 

 There, where the government consented to be sued for "just 

 compensation" for terminating seven timber sales, the court 

 upheld the government's statutory definition of compensation, 

 limiting it to replacement timber premiums, actual out-of-pocket 

 expenses, and increased haul costs. Breach damages like lost 

 profits were clearly disallowed, since the action was a proper 

 exercise of sovereign authority to protect the rights of the 

 public before private contractors. 



QUESTION ^' WHAT 13 YOUR ESTIMATE OF THE COST OF COMPENSATION TO 

 THE TWO LONG-TERM CONTRACT HOLDERS IF THE LONG-TERM CONTRACTS ARE 

 TERM" "ED^ 



iJnder termination, the Congressional Research Service 

 concluded that just compensation, if awarded at all. would range 

 between $21 million and $150 million, with the low figure more 

 1 ike ly . 



Also it is important to point out that attempting to link 

 the action contemplated in 3.346 with the Redwoods "buyout" is 

 inaccurate. The Redwood legislation dealt with condemning and 

 purchasing private property. The Tongass is public property. 



