V
CAUFORNIA FORBT ECOSYSTEMS ACT
Y 4. AG 8/1:103-81
California Forest Ecosystens Act* S. . .
HEARING
BEFORE THE
SUBCOMMITTEE ON SPECIALTY CROPS
AND NATURAL RESOURCES
OF THE
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRD CONGRESS
SECOND SESSION
ON
H.R. 4068
OCTOBER 6, 1994
Serial No. 103-81
Printed for the use of the Committee on Agriculture
U.S. GOVERNMENT PRINTING OFFICE
86-967 WASHINGTON : 1995
For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
ISBN 0-16-046691-1
V
CAUFORNIA FOREST ECOSYSTEMS ACT
V
Y4,AG 8/1:103-81
California Forest Ecosystens Act> S. . .
HEARING
BEFORE THE
SUBCOMMITTEE ON SPECIALTY CROPS
AND NATURAL RESOURCES
OF THE
COMMITTEE ON AGRICULTURE
HOUSE OP REPRESENTATIVES
ONE HUNDRED THIRD CONGRESS
SECOND SESSION
ON
H.R. 4068
OCTOBER 6, 1994
Serial No. 103-81
4PI? f 4 f995
--^^^
Printed for the use of the Committee on Agriculture
U.S. GOVERNMENT PRINTING OFFICE
86-967 WASHINGTON : 1995
For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office. Washington. DC 20402
ISBN 0-16-046691-1
COMMITTEE ON AGRICULTURE
E (KIKA) DE
GEORGE E. BROWN, Jr., CaUfomia
Vice Chairman
CHARLIE ROSE, North CaroUna
DAN GLICKMAN, Kansas
CHARLES W. STENHOLM, Texas
HAROLD L. VOLKMER, Missouri
TIMOTHY J. PENNY, Minnesota
TIM JOHNSON, South Dakota
BILL SARPALIUS, Texas
JILL L. LONG, Indiana
GARY A. CONDIT, CaUfomia
COLLIN C. PETERSON, Minnesota
CALVIN M. DOOLEY, CaUfomia
EVA M. CLAYTON, North Carolina
DAVID MINGE, Minnesota
EARL F. HILLIARD, Alabama
JAY INSLEE, Washington
THOMAS J. BARLOW III, Kentucky
EARL POMEROY, North Dakota
TIM HOLDEN, Pennsylvania
CYNTHIA A. McKINNEY, Georgia
SCOTTY BAESLER, Kentucky
KAREN L. THURMAN, Florida
SANFORD D. BISHOP, Jr., Georgia
BENNIE G. THOMPSON, Mississippi
SAM FARR, California
PAT WILLIAMS, Montana
BLANCHE M. LAMBERT, Arkansas
LA GARZA, Texas, Chairman
PAT ROBERTS, Kansas,
Ranking Minority Member
BILL EMERSON, Missouri
STEVE GUNDERSON, Wisconsin
TOM LEWIS, Florida
ROBERT F. (BOB) SMITH, Oregon
LARRY COMBEST, Texas
WAYNE ALLARD, Colorado
BILL BARRETT, Nebraska
JIM NUSSLE, Iowa
JOHN A. BOEHNER, Ohio
THOMAS W. EWING, IlUnois
JOHN T. DOOLITTLE, CaUfomia
JACK KINGSTON, Georgia
BOB GOODLATTE, Virginia
JAY DICKEY, Arkansas
RICHARD W. POMBO, CaUfomia
CHARLES T. CANADY, Florida
NICK SMITH, Michigan
TERRY EVERETT, Alabama
FRANK LUCAS, Oklahoma
RON LEWIS, Kentucky
Professional Staff
Dlanne Powell, Staff Director
Vernie Hubert, Chief Counsel and Legislative Director
Gary R. Mitchell, Minority Staff Director
James A. Davis, Press Secretary
Subcommittee on Specialty Crops and Natural Resources
SCOTTY BAESLER, Kentucky,
Vice Chairman
SANFORD D. BISHOP, Jr., Georgia
GEORGE E. BROWN, Jr., CaUfomia
GARY A. CONDIT, CaUfomia
EVA M. CLAYTON, North CaroUna
KAREN L. THURMAN, Florida
DAVID MINGE, Minnesota
JAY INSLEE, Washington
EARL POMEROY, North Dakota
CHARLES W. STENHOLM, Texas
COLLIN C. PETERSON, Minnesota
SAM FARR, California
HAROLD L. VOLKMER, Missouri
CHARLIE ROSE, North Carolina, Chairman
TOM LEWIS, Florida
BILL EMERSON, Missouri
JOHN T. DOOLITTLE, CaUfomia
JACK KINGSTON, Georgia
BOB GOODLATTE, Virginia
JAY DICKEY, Arkansas
RICHARD W. POMBO, CaUfomia
TERRY EVERETT, Alabama
RON LEWIS, Kentucky
(II)
CONTENTS
Page
H.R. 4068, a bill to improve the health and productivity of the National
Forest System lands in the State of California and to demonstrate the
use of ecosystem management as a practical management program on
such lands 2
Emerson, Hon. Bill, a Representative in Congress from the State of Missouri,
prepared statement 18
Rose, Hon. CharUe, a Representative in Congress from the State of North
Carolina, prepared statement 17
Witnesses
Francis, Michael, director, National Forests Program, the Wilderness Society . 31
Prepared statement 61
Heissenbuttel, Anne E., director, forest planning and policy, American Forest
and Paper Association 29
Prepared statement 48
Herger, Hon. Wally, a Representative in Congress from the State of Califor-
nia 21
Hofmann, John, vice president, government affairs, California Forestry Asso-
ciation 27
Prepared statement 39
Lehman, Hon. Richard H., a Representative in Congress from the State
of California 20
Owens, Jim, executive director. Western Ancient Forest Campaign 33
Prepared statement 66
Reimers, Mark A., Deputy Chief, Programs and Legislation, U.S. Forest Serv-
ice 22
Submitted Material
Buntrock, Grant, administrator, Agricultural Stabilization and Conservation
Service, U.S. Department of Agriculture, prepared statement 77
Gorton, Terry Barlin, assistant secretary for forestry and rural economic
development, California Resources Agency, prepared statement 83
Heard, Keith, executive vice president, National Com Growers Association,
prepared statement 86
Hoover, Frannie, representative for Sierra Club Califomia/Nevada/Hawaii,
prepared statement 89
Keith, Kendell, president, National Grain and Feed Association, prepared
statement 92
Larson, Kim, soybean and com producer, Willmar, Minnesota, prepared state-
ment 103
Mitchell, Larry, vice president of government relations. National Farmers
Union, prepared statement 105
Sentar, David, American Com Growers Association, prepared statement 108
(HI)
CALIFORNIA FOREST ECOSYSTEMS HEALTH
ACT
THURSDAY, OCTOBER 6, 1994
House of Representatives,
Committee on Agriculture,
Subcommittee on Specialty Crops
AND Natural Resources,
Washington, DC.
The subcommittee met, pursuant to call, at 9:45 a.m., in room
1300, Longworth House Office Building, Hon. Calvin M. Dooley
(acting chairman) presiding.
Present: Representatives Condit, Cla3^on, Pomeroy, Emerson,
Doolittle, Goodlatte, and Lewis.
Also present: Representative Dooley, member of the committee.
Staff present: Glenda L. Temple, clerk; Alexandra Buell, Jim
Davis, Keith Pitts, and Sean Dougherty.
Mr. Dooley. I call to order the Specialty Crops and Natural Re-
sources Subcommittee. We are here to review H.R. 4068, the Cali-
fornia Forest Ecosystems Health Act.
Also, at this point in the record, I will include a copy of the H.R.
4068 and prepared statements from Mr. Rose and Mr. Emerson.
[H.R. 4068 and the prepared statements of Mr. Rose and Mr.
Emerson follow:]
(1)
103d congress
2d Session
H. R. 4068
To improve the health and productivity of National Forest System lands
in the State of California and to demonstrate the use of ecosystem
management as a practical management program on such lands.
IN THE HOUSE OF REPRESENTATIVES
Majich 17, 1994
Mr. Lehman introduced the following bill; which was referred jointly to the
Committees on Natural Resources and Agriculture
A BILL
To improve the health and productivity of National Forest
System lands in the State of California and to dem-
onstrate the use of ecosystem management as a practical
management program on such lands.
1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
4 (a) Short Title. — This Act may be cited as the
5 "California Forest Ecosystems Health Act".
6 (b) Table of Contents. — The table of contents for
7 this Act is as follows:
Sec. 1 . Short title and table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
Sec. 4. Ecosystem management plans for National Forest Sj-stem lands in Cali-
fornia.
Sec. 5. Process for full implementation of ecosystem management plans.
Sec. 6. Research and monitoring program.
Sec. 7. Miscellaneous requirements.
1 SEC. 2. FINDINGS.
2 The Congress finds the following:
3 (1) Although people have had an active part in
4 the development and maintenance of forest structure
5 and the condition of the National Forest System
6 lands in the State of California for many years, re-
7 cent forest management policies have often resulted
8 in a degeneration of the forest structure and a loss
9 of forest health and vigor.
10 (2) The Forest Service, through the judicious
1 1 use of ecosystem management, has an opportunity to
12 reverse these forest management policies and restore
13 the health and vigor of National Forest System
14 lands in California.
15 (3) Ecosystems are dynamic and in a state of
16 constant change, and it is not possible to preserve
17 a given ecosystem condition in a static state over a
18 period of time.
19 (4) The many and varied resources and uses of
20 National Forest System lands provide both tangible
21 and intangible benefits to the people of the United
22 States.
•HR 4068 IH
3
1 (5) Although management of National Forest
2 System lands in California has traditionally placed
3 first priority on the need to produce maximum vol-
4 umes of timber, the other multiple forest resources
5 and services are equally important to the people of
6 California and the United States.
7 (6) Ecosystem management must balance the
8 needs of outdoor recreation, range, timber, water-
9 shed, fish, and wildlife, as required by the Multiple-
10 Use Sustained-Yield Act of 1960 (16 U.S.C. 528 et
11 seq.), as well as protect soil and air quality and pro-
12 vide for forest research.
13 (7) National Forest System lands in California
14 include some of the most unique forest ecosj'stems in
15 the world, including giant sequoias, coastal red-
16 woods, and bristlecone pines.
17 (8) Destructive forest fires classified by the
18 Forest Service as "intense" have occurred in unpree-
19 edented numbers and size on the National Forest
20 System lands in California in recent years, and these
21 fires pose a threat to the very health of the forests
22 and present a danger to human life and property.
23 (9) The Forest Service, through the judicious
24 use of ecosystem management, has an opportunity to
25 reduce the likelihood that fires classified as "in-
•HR 4068 IH :-n *./#** - 1
4
1 tense" will occur with such frequency and, at the
2 same time, to improve forest vigor and visitor safety.
3 (10) Ecosystem management that considers the
4 needs of all species and their ability to interact \vith
5 the presence of humans can integrate both the con-
6 servation needs of the many species of the
7 ecosystems and the multiple use activities of hu-
8 mans.
9 (11) Identification of sound management op-
10 tions is both a biological issue and a social issue,
11 and the resulting management policies must be so-
12 cially acceptable, ecologically sustainable, scientif-
13 ically sound, legally responsible, and economically
14 viable.
15 (12) The results of management practices in
16 local ecosystems can have a profound effect on the
17 levels of demand for commodity outputs from other
18 ecosystems around the world.
19 SEC. 3. DEFINITIONS.
20 For purposes of this Act:
21 (1) Adaptfv^ management. — The term
22 "adaptive management" means the experimental and
23 monitored application of scientifically derived man-
24 agement decisions to gain knowledge that is then
25 used to improve subsequent management decisions.
•HR 4068 IH
5
1 (2) Ecosystem. — The term "ecosystem"
2 means a community of organisms and its environ-
3 ment that functions as a unit.
4 (3) Ecosystem management. — The term
5 "ecosystem management" means the integration of
6 ecological, economic, and social factors to meet the
7 biological needs of all associated organisms and
8 human needs through diverse, healthy, and produc-
9 tive ecosystems, addressing resource supply, con-
10 servation, and demand as opposed to a strategy for
1 1 managing individual species.
12 (4) Ecosystem management plans. — The
13 terms "ecosystem management plans" and "plans"
14 mean the ecosystem management plans for National
15 Forest System lands in the State of California re-
16 quired to be developed by section 4(a).
17 (5) National forest system. — The term
18 "National Forest System" has the meaning given
19 that term in section 11(a) of the Forest and Range-
20 land Renewable Resources Planning Act of 1974 (16
21 U.S.C. 1609(a)).
22 (6) Seral stages. — The term "serai stages"
23 means the various age or life stages of a vegetative
24 community as it progresses from initial establish-
25 ment toward a climax stage or equilibrium.
•HR 4068 IH
6
1 (7) Secretary. — The term "Secretary" means
2 the Secretary of Agriculture.
3 (8) Stand. — The term "stand" means an area
4 within a forest where the trees have similar charac-
5 teristics with respect to species composition, size,
6 condition, and age.
7 (9) Vigor. — The term "vigor", ^\^th respect to
8 forest ecosystems, means the relative health of
9 stands of trees and related vegetation, including
10 their actual gro"^\lh rates as compared with potential
11 growth rates and their ability to protect themselves
12 naturally from forest pests, diseases, and the effects
13 of natural disaster.
14 SEC. 4. ECOSYSTEM MANAGEMENT PLANS FOR NATIONAL
15 FOREST SYSTEM LANDS IN CALIFORNIA.
16 (a) Plans Required. — Notwithstanding the plan-
17 ning provisions of section 6 of the Forest and Rangeland
18 Renewable Resources Planning Act of 1974 (16 U.S.C.
19 1604), the Secretary of Agriculture shall develop and im-
20 plement ecosystem management plans pursuant to this
21 Act to develop and demonstrate ecosystem management,
22 including adaptive management techniques, for National
23 Forest System lands described in subsection (b).
24 (b) Federal Lands Covered by Plans. — The eco-
25 system management plans required by subsection (a) shall
•HR 4068 IH
8
7
1 apply to all management units of the National Forest Sys-
2 tem located in the State of California. In the case of Na-
3 tional Forest System lands in California that have been
4 designated by law for special management before the date
5 of the enactment of this Act, the Secretary shall incor-
6 porate into the ecosystem management plans applicable to
7 those lands any statutory provisions that are in effect on
8 such date and applicable to those lands.
9 (c) Principles of Plans. — Ecosystem management
10 plans shall embody the following principles:
11 (1) Application of management techniques that
12 will enhance the health and vigor of the renewable
13 natural resources on the National Forest System
14 lands covered by the plans and provide for the con-
15 tinued protection of the soil, air, and water re-
16 sources of these lands.
17 (2) Improvement of the forest ecosystems on
18 these lands toward desired forest conditions that —
19 (A) provide a mosaic of forest serai
20 stages —
21 (i) representing a range of \vildlife
22 habitats necessary to meet the needs of the
23 species indigenous to the ecosystem being
24 managed; and
•HR 4068 IH
8
1 (ii) designed in such a way as to obvi-
2 ate the need for corridors or special man-
3 agement areas to meet the needs of given
4 species or situations;
5 (B) minimize the danger of stand-destroj^-
6 ing uncontrolled wildfire;
7 (C) increase or maintain the health and
8 vigor of stands at a level that will permit the
9 stands to resist naturally, to the greatest degree
10 practicable, insect and disease attacks and the
11 effects of other natural disasters while incor-
12 porating the concern that some level of dead-
13 wood, both standing and do\vn, is desirable in
14 health}^ ecosystems;
15 (D) maintain the sustainable economic
16 well-being and stability of communities in areas
17 dependent upon national forest resources; and
18 (E) are developed, to the extent possible,
19 with consideration of the conditions that are
20 knoA\Ti to have existed on these lands or on
21 similar lands before the impacts of European
22 settlement.
23 (3) Concentration of management activities on
24 the condition of the renewable resources of an eco-
25 system rather than on producing targeted outputs,
•HR 4068 IH
10
9
1 with projected outputs based upon attainment of
2 specific stand conditions.
3 (4) Emphasis on tang:ible management results
4 rather than on procedural standards and guidehnes,
5 but with development of scientifically credible mon-
6 itoring standards and guidelines to assess both
7 short- and long-term management results.
8 (5) Except for any statutory pro\asions incor-
9 porated under subsection (b) with respect to specific
10 lands, prohibition on requiring the allocation or cat-
1 1 egorization of tracts of land for specific preselected
12 ecosystem management emphases.
13 (6) Consideration of the habitat needs of all
14 species across a broad landscape using management
15 indicator species whose presence -will reflect a suit-
16 able amount and distribution of particular habitat
17 elements, rather than concentrating on the needs of
18 single species in a limited area.
19 (7) Application across the entire unreserved
20 land base in such a manner as to harmonize the var-
21 ious multiple uses.
22 (8) Incorporation of maximum flexibility in re-
23 source decisionmaking through the use of adaptive
24 management.
•HR 4068 IH
11
10
1 (d) Management to Promote Desired Forest
2 Conditions. —
3 (1) In general. — Ecosystem management
4 under the ecosystem management plans shall be
5 planned and practiced in a manner that —
6 (A) considers the entire landscape in a
7 management unit of the National Forest Sys-
8 tem covered by a plan; and
9 (B) benefits, to the extent practicable, all
10 renewable resources and the human resource in
11 or dependent upon the management unit.
12 (2) Individual projects. — Individual man-
13 agement projects in a management unit of the Na-
14 tional Forest System covered by the ecosystem man-
15 agement plans shall be designed to provide
16 multiresource benefits, promote the desired forest
17 conditions described in subsection (c)(2), and
18 achieve maximum project operating efficiency.
19 (e) Selection of Acres for Ecosystem Manage-
20 ment ACTmTiES. —
21 (1) Minimum acres. — Ecosystem management
22 plans shall specify the minimum number of acres on
23 which ecosystem management activities will be ap-
24 plied annually in any management unit of the Na-
25 tional Forest System covered by the plans. Such
•HR 4068 IH
12
11
1 acreage shall be determined on the basis of the total
2 number of acres in the management unit, the work
3 to be performed across the unit as a whole during
4 the plan period, and the pro rata annual acreage on
5 which ecosystem management activities must be ap-
6 plied in order to establish and maintain the desired
7 forest condition during the specified plan period.
8 (2) Effect of natural disasters. — In case
9 of natural disasters, such as A\ildfire, flood,
10 windthrow, insect or disease attack, a revision of the
11 schedule of acres to be treated may be granted by
12 the Secretary in order to conduct restoration and re-
13 habilitation activities on the acres affected by the
14 natural disaster.
15 (f) Participation in De\^lopment. — To ensure
16 that the ecosystem management plans are economically,
17 scientifically, and socially acceptable, the Secretary shall
18 develop the plans through the use of public involvement
19 programs that emphasize input from residents of local
20 communities to be affected by the plans. The Secretary
21 shall continue to consult with all interested persons in
22 evaluating or modifying the plans.
•HR 4068 IH
13
12
1 SEC. 5. PROCESS FOR FULL IMPLEMENTATION OF ECO-
2 SYSTEM MANAGEMENT PLANS.
3 (a) Implementation. — Beginning not later than
4 January 1, 1995, the Secretary shall begin to implement
5 the ecosystem management plans. The Secretary shall de-
6 velop and implement the plans progressively over a five-
7 year period to ensure full application of all plans not later
8 than January 1, 2000, to all National Forest System
9 lands described in section 4(b). Upon implementation of
10 an ecosystem management plan for any portion of the
1 1 lands described in such section, the plan shall replace and
12 supersede any land and resource management plan (or
13 portion of such a plan) then in effect for such lands.
14 (b) Yeaely Expansion. — During each year of the
15 period specified in subsection (a), the Secretary shall ex-
16 pand application of the ecosystem management plans to
17 contiguous areas required to be covered by such plans, as
18 described in section 4(b). To the extent the Secretary con-
19 siders it to be necessary, the Secretary may modify the
20 ecosystem management plans for each new addition in
21 order to incorporate the lessons gained from experience.
22 Adaptive management shall be used to evaluate manage-
23 ment decisions and to develop new information to be used
24 to keep the plans and subsequent management decisions
25 up-to-date.
•HR 4068 IH
14
13
1 (e) Modification of Ecosystem Management
2 Plans. — The Secretary shall modify the ecosystem man-
3 agement plans to incorporate findings from research,
4 adaptive management projects, or monitoring to the extent
5 such findings indicate changes in the plans are necessary
6 or appropriate to achieve the principles described in sec-
7 tion 4(c). Before the end of the first two years of the pe-
8 riod specified in subsection (a), the Secretary shall issue
9 regulations that set forth the process to be used for any
10 modification of the ecosystem management plans.
11 (d) Consistency. — Resource plans and permits and
12 other instruments for the use and occupancy of National
13 Forest System lands covered by an ecosystem manage-
14 ment plan that are executed subsequent to the implemen-
15 tation date of the plan with respect to such lands shall
16 be consistent with the plan. If the ecosystem management
17 plan is modified, resource plans and permits and other in-
18 struments that are executed subsequent to the date of the
19 modification shall be consistent with the modified plan.
20 Appropriate supplemental documents under the National
21 Environmental Policy Act of 1969 (42 U.S.C. 4321 et
22 seq.) shall be prepared for those resource plans and per-
23 mits, contracts, and other instruments in existence upon
24 adoption of the ecosystem management plan or any modi-
25 fication of the plan. Any revisions in existing resource
•HR 4068 IH
15
14
1 plans and permits, contracts, and other instruments shall
2 be consistent with the supplemental document findings
3 and subject to the agreement of all contractual parties.
4 Any revision in present or future permits, contracts, and
5 other instruments made pursuant to this subsection shall
6 be subject to valid existing rights.
7 SEC. 6. RESEARCH AND MONITORING PROGRAM.
8 The Secretary shall describe in detail in the eco-
9 system management plans and implement as part of the
10 plans a targeted program of research and monitoring
11 aimed at measuring the effects of the management re-
12 gimes adopted under the plans. The Secretary shall ensure
13 that monitoring is sufficient to measure the responses of
14 the various resources to management practices and to pro-
15 vide a basis for adjustments of subsequent management
16 decisions.
17 SEC. 7. MISCELLANEOUS REQUIREMENTS.
18 (a) Increased Use of Certified Professional
19 Practitioners. — ^With respect to National Forest Sys-
20 tem lands covered by the ecosystem management plans,
21 the Secretary shall endeavor to increase the amount of
22 field work to be done by professional practitioners certified
23 by the Forest Service.
24 (b) Accountability Procedures. — The Secretary
25 shall develop accountability procedures to annually meas-
•HR 4068 IH
16
15
1 ure and inform the Congress concerning the work (as de-
2 scribed in section 4(e)) achieved through the use of funds
3 appropriated each year for National Forest System lands
4 covered by the ecosystem management plans. The selection
5 of acres upon which such work will be performed shall be
6 controlled through the planning process. The accountabil-
7 ity procedures required by this subsection shall be estab-
8 lished and in operation before the end of the first two
9 years of the period specified in section 5(a) and shall be
10 designed to ensure the accomplishment of the work in ac-
1 1 cordance ^^^th plan direction.
12 (c) Budgetary Considerations. — The Secretary
13 shall develop budgets for each management unit of the
14 National Forest System covered by ecosystem manage-
15 ment plans on the basis of estimated benefits to the var-
16 ious resources affected b}^ the ecosj^stem management ac-
17 tivities, and such budgets will be justified on such basis.
18 The Secretary shall provide the managers of these units
19 the flexibility to accomplish over-all objectives within over-
20 all budgets in lieu of requiring and preparing detailed line-
21 item budgets for each unit of work, except that account-
22 ability procedures developed under subsection (b) shall in-
23 elude requirements for detailed explanations of expendi-
24 tures and estimates of benefits for each resource.
•HR 4068 IH
17
OPENING STATEMENT OF CONGRESSMAN
CHARLIE ROSE
ON
HR 4068 - The California Forest Ecosystems
Health Act
October 6, 1994
Good morning. I thank everyone for attending today's
hearing. The purpose of today's meeting is to consider HR
4068, the California Forest Ecosystems Health Act.
HR 4068 would establish a demonstrative project on
National Forest System lands within the State of California.
It would require the Forest Service to develop ecosystem
management ^lans that emphasize forest health,
community stability and environmental protection.
The Subcommittee on Specialty Crops and Natural
Resources is pleased to have the bill's sponsor with us.
Congressman Richard Lehman of California. We also have
Congressman Wally Herger with us today . I thank you
both for being here. I look forward to your testimony, and
the testimony of all our witnesses.
18
BILL EMERSON /"^ \f , . , i^c^ ti^-—-^ ^^"^^^
MEMBER OF CONGRESS ' t " "^ SUITE 3d54
8TH DISTRICT MISSOURI RAYBURN BUHDiNG
WASHINGTON DC 20515-2506
202 225-4404
SELECT COMMITTEE ON HUNGER
Congregg of tfje ®niteb ^tateg
5)ou£(e of IRcprcgrntatibcs capegirardTa*u°mo637o
aaaastjington. ©C 20515-2508
house COMMITTEE ON *> • V *■ ■^^-••♦•.vw C7*^ «. M «. V Ai» THE FEDERAL BUILDING
PUBLIC WORKS AND TRANSPORTATION J*. . * >> * * i •'•'^ BROADWAY
314'335-0101
6 12 CINE
STATEMENT OF CONGRESSMAN BILL EMERSON T/j^r'^r
BEFORE THE GENERAL FARM COMMODITIES SUBCOMMITTEE
REVIEW OF CORN AND SOYBEAN PRICES
OCTOBER 6, 1994
Mr. Chairman, I wish to thank you for holding this important forum on a matter
crucial to our farming communities. Today, we have the opportunity to examine the current
situation in the feed grain and oilseed marketplace for the domestic producer. The current
crop outlook for this fall's harvest is presenting many unique challenges to local producers.
Pristine growing conditions in many regions of the country are pushmg the 1994 corn
crop to more than 9.2 million bushels -- a 45 percent increase over the previous year.
Indeed, the value of this crop in the domestic marketplace has many producers rightfully
concerned that a bumper crop does not always yield bumper profits. Moreover, the strong
link still exists between the profit line for local producers and the role they play in sustaining
economic enterprise among various agri-businesses and related Main Street commerce.
Record yields are also predicted for our nation's soybean producers. Indeed, there
are few industries that make a greater contribution to reducing our nation's dependence on
foreign oil and fossil fuels than the soybean farmer - along with corn producers. In a
business such as agriculture where profit margins are vulnerable to weather and marketing
conditions beyond the control of the local producer, the impact of decisions at the federal
level, particularly in relation to federal farm programs remain key to the economic livelihood
OC— nr"^
19
of hard-working producers throughout the countryside. For example, the continued
implementation of federal farm policy, such as ARP or set-aside determinations have a daily
consequence on producer profit potential. Today, I hope to learn how we may work to help
prevent the further erosion of marginally profitable family farm operations.
Securing the plentiful supply of food and agricultural products for the consumers of
this nation and the rest of the world must remain the principal reasoning behind our
continued agricultural existence. While the 1990 Farm Law solidified our world position, it
is clear that we must take the current farm conditions and crop outlook along with present
federal farm programs, and build upon them so that American agriculture will prosper from
now till the year 2000 and beyond. Likewise, this will entail a firm commitment from the
Administration to protect the investment in our agricultural livelihood nationwide. The
economic vitality of our local communities continues to hinge on the success of our
agricultural and related industries.
A prosperous rural economy means greater opportunities for the local folks who sell
the farm implements, drive the grain and livestock trucks, deliver the feed, market the seed
and fertilizer, and process the fruits of our harvest so as to maintain our position as the most
efficient and reliable supplier of the world's food needs. Mr. Chairman, I look forward to
working with you and the Committee Members in order to achieve this goal.
20
Mr. DOOLEY. Our first panel is comprised of Mr. Richard Leh-
man, who is the author of this bill.
STATEMENT OF HON. RICHARD H. LEHMAN, A REPRESENTA-
TIVE IN CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Lehman. Thank you, Mr. Chairman.
I appreciate that the subcommittee has chosen to hold a hearing
on H.R. 4068, the California Forest Ecosystems Health Act, which
I introduced this Congress.
H.R. 4068 is designed to restore common sense to management
of our national forests. It would establish a pilot project in our
State of California for ecosystem management planning. These
plans would emphasize local participation and focus on broad land-
scapes, rather than managing for specific purposes like recreation,
watershed protection, wildlife management or protection for indi-
vidual species. Rather, planning would incorporate all of these fea-
tures in a holistic fashion, emphasizing healthy ecosystems and re-
silient, more fire-resistant forests.
Ecosystem management planning would also require that re-
search and monitoring be an essential part of the management
process. Along with integrating new information, this would enable
forest managers to constantly understand whether their practices
have been successful. Without this as a priority, essential research
and monitoring will be the part of planning that is left out of the
appropriations process. Now, when funds are scarce, research and
monitoring takes the hit.
Let's not kid ourselves, though. Budgets are tight, and they will
remain tight into the foreseeable future. My legislation proposes for
the Forest Service to develop budgeting based on estimated bene-
fits to particular resources, with justifications on this basis. This
big bucket type of financing would be vastly more efficient than the
segmented appropriations process that currently dictates how Fed-
eral dollars are spent.
Of late, forest management in California is focused almost exclu-
sively on protection of a single species, the California spotted owl —
not an endangered species. In many areas designated as CASPO
habitat, no trees less than 30 inches may be cut, despite what the
health of that particular ecosystem might be.
This nonsensical policy has led to the general deterioration of for-
est ecosystems now in the State, and we are now awaiting comple-
tion of the CASPO Environmental Impact Statement, which will
cover a broader range of species deemed to have experienced popu-
lation declines. This will then become at that time the new regime
under which California forests are to be managed.
Not only has this policy du jour approach been devastating for
our forests, but it has devastated our rural communities as well.
Rapid fluctuations from one year to the next harm the forest and
the communities which are connected to them.
In my district alone, three mills have closed within the last year.
This factor has caused much unemployment and true fear — fear of
what the future will bring. Harvests have been reduced substan-
tially, dead and dying trees are piling up, fire danger is peaking.
Admittedly, consistent management of our forests with real long-
term planning, consideration of entire ecosystems, reoriented focus
21
away from timber targets to what is best for the health of our for-
ests may not mean more board feet. However, it will mean consist-
ent and sustainable harvests and dynamic ecosystems which can
provide for multiple needs, including recreation, animal and plant
habitat and healthy watersheds.
I believe this approach has real promise. The Forest Service and
other Federal agencies have embarked on their mission to imple-
ment ecosystem management but I fear, unless truly built into the
forest planning process, it will not be done correctly. As well, un-
less it is understandable to individual foresters and citizens alike,
unless it can be conveyed to my constituents, it cannot be fully im-
plemented.
That is why the bill includes a common sense definition of eco-
system management and focus on local participation. The President
at the Forest Summit called for community-based resolution of for-
est management conflicts, and this bill adopts this approach. H.R.
4068 would establish a framework for locally based solutions like
some of those already under way in California — for instance, the
Quincy Library Group and the Siskiyou Roundtable.
With this bill, forests would develope ecosystem plans for delin-
eated ecosystems with the goal of obtaining a particular desired
forest condition. In other words, citizens and planners would come
to understand the natural conditions of the forest and focus on re-
storing these conditions. All players would have common stakes in
achieving these goals.
Forest management in my district and around the country is
often the subject of rancorous debate, constant lawsuits and numer-
ous appeals. I do not believe it needs to be this way if trust can
be built between as many parties as possible. I believe this is
achievable, and I believe this legislation will get us there.
Thank you, Mr. Chairman for your consideration, and I look for-
ward to the testimony.
Mr. DOOLEY. Thank you. Congressman Lehman.
We are also joined by a former Member of the Agriculture Com-
mittee, an individual also from California who spends considerable
time on forest issues. Congressman Herger.
STATEMENT OF HON. WALLY HERGER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Merger. Thank you, Mr. Chairman. I indeed appreciate the
opportunity of testifying on H.R. 4068, the California Forest
Ecosystems Health Act.
This much needed bill will provide a balanced legislative solution
to our current forest health crisis. At the same time, it will also
provide a limited amount of timber supply for our struggling mills.
The bill before us today is very important to my constituents be-
cause it recognizes California's unique geographic and climatic con-
ditions and attempts to manage our national forests accordingly.
As many of you know, we are currently in our seventh drought
year in the past eight in California, and our forests are clearly feel-
ing the consequences. Already, 375,000 acres have burned in our
State during this year's fire season. Under the status quo, the cur-
rent situation will continue to decline, the health of our pristine
22
forests will deteriorate as stands become thicker and dead and
dying trees are left untouched.
I cannot stress enough the importance of thinning as a vital
management tool. If we adopt this sound practice we will create a
desired condition in which more trees will survive because of less
competition for the limited amount of available moisture caused by
years of drought.
Similarly, removal of dead and dying trees is desperately needed.
Without the use of this practice bug infestation will continue to in-
crease and spread from dead to healthy trees.
I am pleased to join my fellow California colleague, Mr. Lehman,
as a cosponsor of this legislation. H.R. 4068 represents the best of
all worlds in which the health of our forests and the stability of our
rural forest communities can flourish again.
By providing a legislative framework for local community stabil-
ity proposals such as the Quincy Library Group and the Siskiyou
Roundtable, this bill enables local input. I can tell you, having
worked with these groups in my district in northern California,
how extraordinary it has been to see local environmentalists and
loggers put years of sharp differences behind them and work to-
gether on local forest health management agreements.
Finally, H.R. 4068 changes the way the Forest Service does busi-
ness by evaluating the agency on the number of acres treated to
achieve the desired forest condition. This process will lead to
healthier forests through the prompt reduction of natural fuels. By
reducing natural fuels through the use of thinning, removal of un-
derbrush and dead and dying trees, we will also be providing our
local mills with at least a limited amount of timber.
In conclusion, Mr. Chairman, I want to stress that while I am
a strong supporter of H.R. 4068 as a long-term legislative solution,
the forest health crisis is so severe in California that short-term
emergency action is also a necessity.
For this reason, I have introduced H.R. 4742, the Forest Fire and
Pest Emergency Act, which declares a state of emergency on our
national forests in California and would allow our professional for-
esters to immediately reduce fuels in areas of extreme fire risk. I
urge this subcommittee to take a serious look at this bill as well.
Thank you.
Mr. DOOLEY. I thank both of you for testifying this morning and
would welcome you to join the committee for the upcoming wit-
nesses if you would care to. Thank you very much.
We will now call our second panel. Mr. Mark Reimers, Deputy
Chief for Programs and Legislation, with the U.S. Forest Service.
STATEMENT OF MARK A. REIMERS, DEPUTY CHIEF, PRO-
GRAMS AND LEGISLATION, FOREST SERVICE, U.S. DEPART-
MENT OF AGRICULTURE, ACCOMPANIED BY BARBARA
WEBER, ASSOCIATE DEPUTY CHIEF, RESEARCH
Mr. Reimers. Good morning, Mr. Chairman.
I thank the committee for all the attention they have given to
forestry matters over the last few weeks both on ecosystem man-
agement and forest health and thank Congressman Lehman and
Congressman Herger for their strong interest in the well-being of
the national forests of California.
23
We appreciate this opportunity to offer our views on H.R. 4068,
the CaHfomia Forest Ecosystems Health Act of 1994. The Depart-
ment of Agriculture supports many of the ecosystem restoration
concepts presented in the bill.
The purpose of H.R. 4068 is to improve the health and productiv-
ity of the National Forest System lands in the State of California
and to demonstrate the use of ecosystem management as a prac-
tical management program on these lands.
The Forest Service agrees with the purpose of the bill and with
using adaptive management to implement and monitor ecosystem
management actions. The purpose of the bill also follows some of
the preliminary recommendations being considered by the Forest
Service's Western Forest Health Initiative Team, which was dis-
cussed earlier this week in a hearing here by Assistant Secretary
Lyons.
We support the principles of the bill. The ecosystem management
plan should apply management techniques that will enhance forest
health and vigor, provide a mosaic of forest serai stages, minimize
uncontrolled wildfire, maintain the health and vigor of stands,
maintain the sustainable economic well-being of communities de-
pendent on the various national forest resources, and require mon-
itoring and evaluation of ecosystem management implementation.
However, we do have some concerns with the bill. We would pre-
fer to implement an ecosystem management approach that is based
on ecological units. That means that in some cases the units would
extend beyond the boundary of California. We are working to en-
compass, as we do this, all Federal lands and also work with other
landowners on a voluntary basis. We also would like to see the leg-
islation nationwide in scope so that it would apply throughout the
National Forest System.
In addition, while the bill contains many of the same objectives
of the National Forest Management Act, we are unsure of the exact
relationship of the effects of the plans that would be prescribed in
this bill as it relates to the National Forest Management Act.
Another concern that we have is that H.R. 4068 directs the For-
est Service to consider the habitat needs of all species across broad
landscapes using management indicator species. We agree about
the value of indicator species but also believe that there will be
other indicators that are needed as we look at ecosystem manage-
ment and that we need to consider all species in the entire eco-
system.
But I think we are in firm agreement that we want to manage
an area of the land in a sustainable way using ecosystem prin-
ciples.
Toward some of the goals, we have initiated several comprehen-
sive scientific studies which members are involved with. We are
working with the Department of Interior. Two examples of studies
that are under way in this broad approach to ecosystem manage-
ment is the Eastside Ecosystem Management Project for the forests
of the Columbia Basin and, more specifically to California, the Si-
erra Nevada Ecosystem Project in California.
These studies integrate the latest scientific knowledge on the bio-
logical, physical and economic environment to develop management
24
strategies to maintain ecosystem health and sustainability while
providing resources to meet human needs.
In section 4(e), Selection of Acres for Ecosystem Management Ac-
tivities, the bill states that ecosystem management plans shall
specify the minimum number of acres on which ecosystem manage-
ment will be applied. Although we support ecosystem management
accountability and we need to work with the Congress to better de-
fine that, we believe that the broad goal in section 5 of completing
plans over 5 years is more appropriate.
Section 5(a) would have ecosystem management plans replace
the existing Forest Service land and resource management plans in
California. As I previously stated, new legislation would need to be
clear in its relationship between the new legislation and the Na-
tional Forest Management Act and the associated regulations.
Clearly, we would have to have one set of regulations that inte-
grate any new requirements with the existing regulatory frame-
work.
Although we have concerns with the bill, we support the concept
of the bill to use an ecosystem management approach to manage
National Forest Systems lands. We have emphasized our support
of ecosystem management in several hearings before this commit-
tee during this Congress. We look forward to working with the sub-
committee and Congressman Lehman in preparing legislation to
address our concerns in the 104th Congress.
This concludes my testimony. I will be glad to answer any ques-
tions you may have. Thank you.
Mr. DOOLEY. Thank you very much.
Perhaps at this time we would extend the courtesy to the author
of the legislation, Mr. Lehman, to see if he has questions.
Mr. Lehman. Thank you, Mr. Chairman.
Thank you, Mr. Reimers. I appreciate your testimony and your
continued cooperation in this matter.
Let me just ask some basic questions. Is ecosystem management
going to be implemented by the Forest Service?
Mr. Reimers. Yes, it is. That is our intent, that is the direction
we are moving, and we have a number of good examples both at
the broad landscape scale and the kind of cooperative action that
you mentioned right at the ground level as we work on specific
plans for specific areas.
Mr. Lehman. So you see us moving away from managing for a
single species or single purpose toward a broader regime?
Mr. Reimers. Yes. Clearly, as you have indicated, we should.
That is our intent, and we are moving that way now.
Mr. Lehman. Will legislation ultimately be necessary then to im-
plement that change?
Mr. Reimers. We are still evaluating that question and are going
to need to work with you and the committee. We are proceeding
under our existing authority. We feel that we can implement eco-
system management.
There are questions raised as various lawsuits occur if a
strengthened legislative framework would help us move forward
more rapidly, but we haven't reached the conclusion yet that we
can't proceed under existing authority, and we are moving ahead
under existing authority.
25
Mr. Lehman. As I mentioned, the President has encouraged a
community-based conflict resolution for forest management. Does
the Forest Service continue to encourage that and can you give ex-
amples of areas where that has worked?
Mr. Reimers. Yes. I think we have a number of examples that
are occurring.
You mentioned the Quincy library project. We are running into
some difficulties under the Federal Advisory Committee Act. We
have some serious questions now as to how we best interact with
the public in a way that brings them into the process but also com-
plies with that act.
Mr. Lehman. You mentioned the Sierra Nevada ecosystem
project. How do you see that being integrated into the management
of our forest in California and how do you think that might inter-
face with the CASPO guidelines once developed?
Mr. Reimers. I would like to ask Barbara Weber, the Associate
Deputy Chief for Research, to respond to that question.
Ms. Weber. Good morning. My name is Barbara Weber.
The Sierra Nevada ecosystem project was established to do an
assessment of the Sierra Nevada ecosystems, and once that assess-
ment is completed it will be delivered to Congress for evaluation
and then considered by the Forest Service in relation to the CASPO
report and management of the National Forest System. So it is a
step-by-step process to get to the point where we will integrate the
findings of the Sierra Nevada Ecosystem Project eventually into
management plans for the Sierras.
Mr. Reimers. Our approach has been that we are moving to
stronger assessments as step one, and then those lead us into more
detailed planning. Hopefully, we have a common framework of in-
formation that we can work with the local communities, the Forest
Service land managers and the research community, and move in
a way that we can draw consensus toward the goals and the direc-
tion for an area.
Mr. Lehman. Thank you. And since we are moving away from
timber targets as the measure I guess for budgeting purposes, what
do you think we ought to use as a goal? The bill I have proposes
a number of acres, but
Mr. Reimers. Our difficulty with specific numbers of acres is that
on one hand, we see ecosystem management as applying to broad
areas, and it won't be like you 100 percent complete an acre and
move on to another acre. That is why we emphasize a goal of hav-
ing plans in place.
On the other hand, we agree that we need to have a range of per-
formance measures that measure the outcomes.
What we want to be able to do, and I think we agree ultimately,
is to be able to describe resource conditions on a piece of land, how
we moved toward the planned objectives, and specific outputs re-
sulting from our management.
We will still be having measurements of outputs that relate to
recreation or range or timber, but we are trjdng, and we haven't
completed this, to get some better performance measures so that
you and others can be comfortable that, yes, we have accomplished
what you asked us to do.
26
Actually, in this year's budget process we have a line item that
speaks to the question of ecosystem monitoring. So in the future
you may want to be able to look at the results of what we have
done in monitoring to be sure that we are accomplishing the objec-
tives that were outlined in this community setting.
Mr. Lehman. Thank you very much.
Mr. DOOLEY. Thank you, Congressman Lehman.
Mrs. Clayton, do you have questions?
Mrs. Clayton. No questions.
Mr. DoOLEY. I have one question. As I understand, there is an
interagency task force that is working together to try to look at this
whole ecosystem approach not only in terms of the forest but in
terms of other ecosystems, be they estuaries, wetland areas or
whatever.
Within that process, is there a specific committee that is as-
signed to try and understand and deal with the potential conflicts
that might be apparent or a result of some of the existing environ-
mental regulations that could preclude the moving forward of an
ecosystem approach? For example, the ESA requires focusing on a
single species, even a single habitat requirements for that species.
Is there a part of the task force that is trying to identify those con-
flicts and propose solutions or recommendations to deal with those?
Mr. Reimers. Yes, there is. There is an interagency group at the
Assistant Secretary level that Assistant Secretary Lyons, on our
behalf, interacts with Assistant Secretaries from Commerce and
the Department of the Interior and others that have a number of
sub task forces looking at the question.
In addition, the task force that I mentioned that is looking spe-
cifically at the western forest health crisis is also raising some of
those same kinds of questions.
So I see over the next 3 to 6 months that we are going to have
to come and address the question, can we proceed under existing
authority or are there some problems that need to be addressed?
At present, we think that many of the concerns could be addressed
through some regulatory changes, and the same would be true of
the way we interact with the Federal Advisory Committee Act.
Mr. DoOLEY. We are looking forward to the results of that proc-
ess because, as you alluded to earlier, we are being hindered or are
having to deal with a significant number of lawsuits and an3d;hing
that we can do in moving forward with a different management re-
gime or policy that could mitigate or reduce those lawsuits it would
be in everybody's interests.
Thank you for testifying. We appreciate your efforts on trying to
help us understand this legislation better.
We will now call the next panel, John Hofmann, vice president
of government affairs, California Forestry Association; Miss Anne
Heissenbuttel, director of Forest Planning and Policy, American
Forest and Paper Association; Mike Francis, director, National For-
est Program; Mr. Jim Owens, executive director of the Western An-
cient Forest Campaign.
Unless there is objection we will proceed in the order in which
the panelists were listed. Mr. Hofmann, we will ask you to begin.
Thank you.
27
STATEMENT OF JOHN HOFMANN, VICE PRESffiENT, GOVERN-
MENT AFFAIRS, CALIFORNIA FORESTRY ASSOCIATION
Mr. HOFMANN. Thank you, Mr. Chairman and members of the
subcommittee.
I am John Hofmann, vice president for the CaHfomia Forestry
Association. We appreciate the opportunity to express our views on
H.R. 4068.
The California Forestry Association supports H.R. 4068. This leg-
islation is in harmony with the vast majority of reports commis-
sioned by this committee and others in recent months. It is a
proactive forest health ecosystem bill that recognizes California's
political structure, forest history and diversity, in combination with
science to provide healthy forests and healthy communities. It fol-
lows the President's advice to insist on collaboration, not confronta-
tion.
California is a State with diversified ecosystems. Many of these
ecosystems are acknowledged as unhealthy but not in a state of col-
lapse. Passing this legislation would follow the recommendations of
the GAO's recent report to demonstrate ecosystem management in
areas where flexibility exists to coordinate activities across
ecosystems,
California's diversification will demonstrate the applicability of
ecosystem management principles over a wide array of ecosystems.
The test of ecosystem management will be the restoration of forest
health.
California's historical forests were open with trees set apart in
groups. John Muir, in 1894, wrote: "The inviting openness of the
Sierra woods is one of their most distinguishing characteristics.
The trees of all the species stand more or less apart in groves or
in small irregular groups."
Fire, used by Native Americans, limited regeneration. As Califor-
nia settlers appeared in the mid-1800's, fire exclusion favored
young tree growth. As the canopy closed, the young growth of na-
tive shade-intolerant species died, leaving an understory of the
more fire-prone, shade-tolerant species, such as white fir.
When the Nation cried for wood products at the turn of the cen-
tury, removal of the overstory left; a forest of predominantly
nonnative, shade-tolerant trees. Had fire continued simultaneously
with logging, a perpetuation of Muir's forest may have continued.
Forest Service Chief Jack Ward Thomas testified on August 29
before the Senate subcommittee that the forest health problem is
the result of two existing conditions: one, too many trees and, two,
many trees are the wrong species.
Earlier this year, the California Forestry Association joined the
Wilderness Society and others in advocation of forest thinning
through natural fuels treatment. The California Forestry Associa-
tion also supports H.R. 4742, The Forest Fire and Pest Emergency
Act introduced by Congressman Herger. H.R. 4742 is a short-term
solution to reduce natural fuels in extreme fire risk areas. H.R.
4068 is a long-term solution to thin the forest and grow the right
trees.
Forest thinning has proven effective in reducing forest mortality.
Attached to my testimony is a report of a research study conducted
on the Lassen National Forest in California. After 14 years, plots
28
thinned to 40 percent of basal area have not lost a single tree while
plots untreated have an average mortality over 30 trees per acre.
H.R. 4068 recognizes that many decisions of ecosystem manage-
ment are subjective. Scientists can justify the delineation of an eco-
system as small as a rotten log or as large as the universe. An eco-
system can be a geographic area, it can be based on species, it can
revolve around a community, or it can be defined as serai stages.
The GAO suggests that forest health is subjective. Forest man-
agers recognize the value of dead and down wood and regeneration,
but too much jeopardizes the entire ecosystem. Since ecosystems in-
clude humans, forest health must sustain ecosystem complexity
and provide for a level of human needs.
The desired forest condition has been under constant debate. His-
torical forests fit the lifestyles of the native inhabitants. They may
not be desirable today. Ecosystem managers must recognize human
uses of forest resources have changed.
Subjective decisions such as ecosystem boundaries, forest health
and desired forest condition require public policy based on good
science, good social/economic data and strong local public involve-
ment. California has established bio-regional councils which will
foster local consensus groups such as the Quincy Library Group
and the Siskiyou County Roundtable to resolve subjective decisions.
The public and the Forest Service will jointly develop an individ-
ualized ecosystem management plan for each identified ecosystem.
Accountability follows the Vice President's direction that the Grov-
ernment will be performance driven. Performance will be measured
in acres treated, not in board feet produced. The legislation limits
public debate over the desired forest condition to a mosaic pattern
that is fire safe, insect and disease resistant, economically viable,
harmonizes all uses and recognizes the historical condition.
A similar forest condition was demonstrated in the Ashland wa-
tershed. Marvin Plenert, then Regional Director for the Fish and
Wildlife Service, evaluated the project and stated:
"When holistic management is done properly, there is no real
need for protected areas, as all areas could receive both conserva-
tion and harvest with the overall ecosystem in mind. In addition,
this approach could eliminate the need to list species under the En-
dangered Species Act because the threats of extinction from habitat
degradation will have been significantly eliminated . . ."
H.R. 4068 takes a different approach to adaptive management.
Ecosystem plans are developed based on the best science available
with the objective of achieving healthy forests. That plan is imple-
mented and monitored to ensure the desired results are achieved.
Adaptive management is used to readjust the plan if changes occur
or it is evident that the plan will not reach the objective. It is not
used to provide continual experiments across the landscape.
The California economy is among the most dependent upon forest
resources. Since 1990, California has lost more jobs in the forest
products industry than any other State except Oregon — over 5,000
jobs. Families, communities and the forests are losing with the
present system. California's forests are growing at a rate of nearly
4 billion board feet annually and with a harvest of less than 1 bil-
lion board feet, California's forests are growing thicker and more
29
fire-prone each day. H.R. 4068 provides an opportunity for change
and hope.
Thank you, Mr. Chairman.
Mr. DOOLEY. Thank you Mr. Hofmann.
[The prepared statement of Mr. Hofmann appears at the conclu-
sion of the hearing.]
Mr. DooLEY. Ms. Heissenbuttel.
STATEMENT OF ANNE E. HEISSENBUTTEL, DIRECTOR, FOREST
PLANNING AND POLICY, AMERICAN FOREST AND PAPER AS-
SOCIATION
Ms. Heissenbuttel. Thank you, Mr. Chairman and members of
the subcommittee. I am Anne Heissenbuttel, director of forest plan-
ning and policy for the American Forest and Paper Association.
AF&PA members are greatly concerned about the need to im-
prove the health and condition of many thousands of acres of public
lands and to maintain healthy conditions on all our forestlands.
The California Forest Ecosystems Health Act provides one ap-
proach for addressing this very important issue.
H.R. 4068 identifies a number of issues that AF&PA believes
must be addressed by the Federal land management agencies when
implementing ecosystem management on lands under their juris-
diction.
Among these, the bill would support implementation of a plan for
ecosystem management of all national forestlands within the
boundaries affected by the bill. It would focus on the condition of
the ecosystem rather than on targeted outputs; and it requires con-
sideration of the habitat needs for all species and not taking a sin-
gle-species approach that we have had so much difficulty with in
many areas, not only the West.
I would like to touch on each issue.
First, we believe that if it is to be effective ecosystem manage-
ment must be applied across the entire national forest landscape.
It must not be limited to those lands designated as suitable
timberlands. Nor should it be applied as a set of inviolable stand-
ards and guidelines simply layered upon previous land manage-
ment decisions and land allocations.
Management activities must be designed to maintain, enhance
and, where necessary, restore the health and long-term productiv-
ity of the entire Federal land ecosystem. Moreover, activities must
be consistent with legislative authority for those agency lands.
Second, we concur that on-the-ground management should focus
on practices designed to achieve and maintain an agreed-upon de-
sired forest condition. Some of these practices should and will
produce predictable levels of resource outputs. While output targets
do not drive the management process, the expected results need to
be predicted and documented, and forest managers must be held
accountable to Congress and the public for achieving those desired
conditions and the resulting predicted outputs.
The importance of defining the desired forest condition and work-
ing to improve that condition on many of our forested lands has be-
come terribly apparent this season. Many scientists have warned
that it is not a question of how much will bum, it is only a ques-
tion of when, since so many of our forests today are in overstocked
86-967 0-95-2
30
and unhealthy conditions. We know that without taking action now
and continuing action into the future, we will only face more years
when our personnel and funding needs far outweigh our ability to
keep severe fire damage to a minimum.
It is well documented that the cost of preventing destructive fires
is much less than the expense of fighting fires and recovering
burned lands in the aftermath. Thinning, salvage logging, fuels re-
duction and management and controlled burning where conditions
allow provide the most appropriate and cost-effective tools for any
wildfire prevention program.
Appeals to halt salvage efforts have also greatly hindered the
agenc^s ability to promptly begin recovery and reforestation efforts
and squelched any hope of reducing the overall cost of the effort by
recovering the value of burned timber. The Forest Service must be
encouraged to use every opportunity within its means to expedite
the NEPA process and to recognize the emergency nature of these
salvage and rehabilitation needs so that the exemption allowed
under the current appeal rules can be and is used wherever nec-
essary.
Third, AF&PA believes ecosystem management will succeed if it
enables managers to provide for the needs of all species, without
the need for separate plans to protect individual species within the
planning area. It should focus on ways to achieve desired habitat
conditions needed for a mix of species, rather than provide pro-
tected zones for one species overlaid or added to separate zones for
another.
We are supportive of these general concepts as essential prin-
ciples that must be addressed in any ecosystem management plan,
and I am afraid they are not addressed in the President's plan for
the northwest. However, we also have concerns with some provi-
sions of H.R. 4068.
First, it does little to resolve the inherent conflicts between pro-
cedures that are prescribed by the numerous environmental and
land management laws passed over the last 30 years.
In addition, H.R. 4068 calls for the development of new eco-
system management plans. Just how and why these plans should
replace the current land and research management plans required
by NFMA is unclear. We believe the Forest Service can and must
begin to implement ecosystem management consistent with the
above principles and within the context of the current NFMA
plans.
While we agree the current process does not facilitate implemen-
tation of ecosystem management I don't believe a new tjrpe of plan
is what is needed most. Instead, legislation will be needed to ad-
dress the real conflicts between the many procedural requirements
of NFMA, the National Environmental Policy Act, the Endangered
Species Act, the Clean Water and Clean Air Acts, and other envi-
ronmental and management laws.
Similarly, the Federal antitrust laws currently preclude much of
the cooperation among landowners that could be supported by
many of our member companies. Please refer to the paper attached
to my testimony by William Randolph Smith for more information
about this very real concern.
31
Finally, AF&PA's vision is to ensure the continuing availability
of forest products and other resources to meet the needs and reflect
the values of growing populations by sustainably managing the for-
est resources of the Nation. We aim to ensure that future genera-
tions derive the same benefits from forests that we enjoy today. We
believe that public lands can achieve sustainable forestry through
ecosystem management and commend Congressman Lehman for
his efforts to help facilitate ecosystem management in the West.
I will be happy to answer questions.
[The prepared statement of Ms. Heissenbuttel appears at the
conclusion of the hearing.]
Mr. DOOLEY. We will now go to Michael Francis, the director of
the National Forest Program by the Wilderness Society.
STATEMENT OF MICHAEL FRANCIS, DIRECTOR, NATIONAL
FORESTS PROGRAM, WILDERNESS SOCIETY
Mr. Francis. Thank you, Mr. Chairman, and members of the
committee for this opportunity to testify today on H.R. 4068, the
California Forest Ecosystems Health Act.
I am Michael Francis. I am the director of the National Forests
Program for the Wilderness Society. The society is a national con-
servation organization with 272,000 members, 52,000 of whom re-
side in California. As this committee is aware, the society is recog-
nized as a leader in the national debate over forest and natural re-
source policy and the evolving doctrine of ecosystem management.
I request that a recent outline addressing ecosystem manage-
ment prepared by the society be included in the hearing record.
While we would like to thank Representative Lehman for bring-
ing the issue of ecosystem management before this committee and
the Congress, the Wilderness Society is opposed to the bill in its
current form.
The bill is unnecessary, unscientific, costly and would perpetuate
the bias toward timber production which has resulted in serious
well-documented environmental problems in our public forests. Re-
gretfully, H.R. 4068 would fail to protect and would, in fact, en-
courage the logging of the remaining ancient forest ecosystem and
roadless areas in all of California's national forests.
H.R. 4068 is unnecessary and redundant. The National Forest
Management Act currently provides more than adequate authority
and direction to the Forest Service to incorporate ecosystem man-
agement principles into its management activities. Moreover, the
Forest Service under Chief Thomas has embraced ecosystem man-
agement as its guiding policy nationally.
In addition, region 5 of the Forest Service has recently issued
draft ecosystem management guidelines to implement the Chiefs
new policy in California.
Mr. Chairman, at a congressional hearing only a few weeks ago,
your committee heard testimony from the GAO which found that
the Federal agencies are beginning to implement ecosystem man-
agement. Ecosystem management is a complex and evolving doc-
trine and deserves a thoughtful, comprehensive review by Congress
before congressional action is warranted.
H.R. 4068 is not based on science. It prejudges the outcome of
ecosystem planning by eliminating corridors and other special man-
32
agement areas. Not only is this contrary to current scientific think-
ing about ecosystem management as evidenced in President Clin-
ton's forest plan, it also prejudges the outcome of two administra-
tive processes under way in California that are focused on eco-
system planning in the Sierra Nevada range — the California Spot-
ted Owl environmental impact statement and the Sierra Nevada
ecosystem project.
As currently drafted, the scope of H.R. 4068 is too broad and too
poorly defined. The bill would require the preparation of new eco-
system management plans for all of the national forests in Califor-
nia, including those in northern California, thus preempting the
California portion of President Clinton's forest plan.
The bill does not adequately establish the need for new plans, ei-
ther in the Sierra Nevada or the other national forests in southern
California. The bill would result in a costly and unnecessary ex-
penditure of taxpayers' money to develop these plans.
H.R. 4068 would set an unacceptable precedent with national im-
plications by supplanting the National Forest Management Act.
Again, the need to replace NFMA has not been clearly dem-
onstrated to this committee nor to the public at large, nor has the
rationale been provided to justify special treatment for California's
forests when many of the same conditions pertain on national for-
ests in other States.
Though the actual language of H.R. 4068 is somewhat vague, the
Society is concerned about provisions that appear to be inconsistent
with the goals of the National Environmental Policy Act.
Finally, the society is concerned that the concept of ecosystem
management inherent in H.R. 4068 is biased toward commodity
production and hostile to ecosystem protection.
A basic tenet of ecosystem planning, missing in the bill, is the
critical need to protect those areas that are functioning well while
working to restore natural processes and functions on degraded
areas. Rather than do that, the bill requires the use of adaptive
management across the landscape.
Furthermore, it presumes that human managers possess suffi-
cient information and capabilities to manage the entire landscape
without preserving any particular area. Not only is this presump-
tion unscientific, it is also indicative of the same arrogance and ig-
norance that has created the environmental problems we face
throughout the Nation today in the National Forest System.
On conclusion, Mr. Chairman, because of the concerns discussed
above, we oppose H.R. 4068. In addition to substantive problems
with the bill, we feel that the legislation would preempt current ad-
ministration initiatives and is therefore not needed at this time.
We are, however, eager to work with you and other Members of
the committee and Mr. Lehman to explore other ideas in the con-
tinuing evolution of natural resource policy and the implementa-
tion of meaningful ecosystem protection and management.
Thank you for the opportunity to share the society's views on eco-
system management in the national forests of California.
Mr. DOOLEY. Thank you.
[The prepared statement of Mr. Francis appears at the conclu-
sion of the hearing.]
33
Mr. DOOLEY. Mr. Owens, executive director of the Western An-
cient Forest Campaign.
STATEME^^T OF JIM OWENS, EXECUTIVE DIRECTOR, WESTERN
ANCIENT FOREST CAMPAIGN, ALSO REPRESENTING THE SI-
ERRA NEVADA ALLIANCE
Mr. Owens. Mr. Chairman and members of the subcommittee,
my name is Jim Owens. I am the executive director of the Western
Ancient Forest Campaign which represents grassroots forest activ-
ists from California, Oregon, and Washington.
Today I also represent the Sierra Nevada Alliance, a coalition of
California community leaders and activist groups. I thank you very
much for this opportunity to come before you today to discuss H.R.
4068, the California Forest Ecosystem Health Act.
I have prepared and submitted written testimony to the sub-
committee on H.R. 4068 and will now summarize my comments re-
garding this bill.
I have also appended to my testimony a letter commenting on
H.R. 4068 that was sent to Congressman Rick Lehman by John
Buckley, executive director of the Central Sierra Environmental
Resource Center in Twain Harte, California. I would appreciate in-
clusion of this letter in the record of this subcommittee hearing.
Mr. Chairman, H.R. 4068 is one of many attempts by Members
of Congress, representatives of the administration, Forest Service
professionals, biologists and concerned citizens to define and imple-
ment ecosystem management and forest health. While I and others
in California's environmental community appreciate the efforts of
Congressman Lehman to shift the management of California's Fed-
eral forests from a commodities-oriented approach to one based on
principles grounded in sound scientific findings and recommenda-
tions, we feel this bill fails to guarantee true ecosystem manage-
ment of California's Federal forests.
In addition, the bill severely limits the ability of concerned citi-
zens to engage in a meaningful manner in the development of long-
range management plans for these forests. For these reasons and
more, the coalitions I represent oppose H.R. 4068 as it is currently
written.
While H.R. 4068 condemns targeted commodities outputs, we ap-
preciate that the bill has the practical effect of setting aside a spec-
ified acreage for each forest on which ecosystem management ac-
tivities will be performed. We agree with the representative of the
Forest Service that other measures should be sought and used to
determine the success of ecosystem management.
H.R. 4068 seeks to suspend the portion of the Forest and Range-
land Renewable Resources Planning Act of 1974 which provides for
the development of forest plans and the participation by the public
in the redrafting of these plans at least every 15 years. By now,
most Members of Congress have recognized that any attempt to
suspend laws is a nonstarter. Citizens across the Nation value the
opportunity to engage in the development of planning and decision
documents by public agencies and will not tolerate the abridgement
of the basic democratic right of public participation in the Nation's
government.
34
H.R. 4068 discards wildlife corridors and special management
areas that have been established by the Federal Government for
the protection and restoration of a number of sensitive wildlife and
fisheries species that occur in California's Federal forests. The re-
pudiation of these efforts to get ahead of the game in protecting
forest ecosystems doesn't make sense and could lead to population
crashes of a number of wildlife and salmonid species. Removing
these special management areas and opening them up to new log-
ging or development pressures has no place in any ecosystem man-
agement strategy.
This bill advocates the use of adaptive management and adaptive
management areas as ecosystem management techniques. As yet,
adaptive management is an untested and experimental concept
that has not been proven to be a practicable forest management
tool, or even capable of being implemented on Federal forests. The
environmental community opposes the statutory prescription of
adaptive management for Federal forests.
In the end, Mr. Chairman, this bill is unnecessary, given that the
Forest Service is actively engaged in a comprehensive effort to sci-
entifically analyze the resources of the Sierra Nevada and to de-
velop long-range ecosystem management strategies that address a
broad range of resource and development issues. The agency has
already developed, and begun to implement, the recommendations
of the California Spotted Owl Report— CASPO. This bill would de-
rail CASPO and sidetrack the scientific analysis currently under
way by the agency.
In addition, it would discard the hundreds of hours that have
gone into the development of the Northwest forest plan, which may
yet serve to resolve the timber wars of northern California if it is
properly implemented.
Mr. Chairman H.R. 4068 attempts to deal with a number of for-
est management issues affecting California's Federal forests. But in
the eyes of the State's environmental community it comes up short.
On behalf of this community, I urge the subcommittee to refrain
from acting on this bill, in the interest of permitting ongoing Fed-
eral processes to develop ecosystem management strategies based
upon sound scientific data and analysis.
This concludes my testimony. I look forward to responding to
questions or comments you may have.
Mr. DOOLEY. Thank you.
[The prepared statement of Mr. Owens appears at the conclusion
of the hearing.]
Mr. DooLEY. We are pleased to be joined by another Congress-
man from California, Mr. Doolittle. Welcome.
The author of the legislation, Mr. Lehman, is recognized for any
questions he might have of the panel.
Mr. Lehman. I appreciate you giving me the opportunity to sit
with your panel today.
Mr. Owens and Mr. Francis, and I guess hopefully speaking for
those you speak for but I imagine for yourselves as well, what is
your vision of desirable forest conditions in the Sierra Nevada?
Mr. Owens. I will take that on first.
Two days ago, we heard Mr. Lyons talk about the goals his agen-
cy was pursuing not only on the Eastside forest but also for forests
35
in California. He talked about trying to bring the forest back to a
pre-European, presettlement condition before the logging that
swept across the Sierra Nevada and essentially high graded the big
Ponderosa pines that dominated most of the landscape.
I think most of my coalition agrees that trying to reach this
presettlement would be a useful goal, and we prefer that rather
than a goal of being 30 years back or 60 years back because these
a-e just momentary blips in the dynamics of the forest.
Mr. Francis. Mr. Lehman, I think in a broad sense, because we
still are learning a lot about ecosystem management, it is a sci-
entific, evolving process, but I think the ultimate objective for the
Sierra Nevadas is to sustain their regenerative capacity by protect-
ing their biological diversity and sustain their productivity poten-
tial as a continuing, ongoing function of the ecosystem into the fu-
ture.
Mr. Lehman. Is timber harvesting on public lands compatible
with your vision?
Mr. Francis. Yes, sir.
Mr. Owens. I think you will find members of my community who
feel that in certain areas of the forest, areas that might be defined
as matrix, that timber harvest is one of many actions that can go
on. These people, as you know, live in the same communities as
their neighbors who are loggers or recreationists, and they feel that
you can't eliminate timber harvests from forest management.
Mr. Lehman. And you can have a pre-European condition with
timber harvesting.
Mr. Owens. In terms of pre-European that I was referring to —
and I think Mr. Lyons was as well, we should try to attain those
open forests that are free of the under ladder of fuels that can cre-
ate the sort of holocaust that we are all quite nervous about.
Mr. Lehman. When you say a pre-European system are humans
part of that?
Mr. Owens. Humans have been part of the Sierra forest systems
for at least the last 10,000 or 15,000 years. I think our testimony
today indicated that Native Americans have been using fire as a
management tool in those forests as long as our records go back.
Mr. Lehman. I guess the question in my mind, and I am trying
to articulate it, is I am concerned about having a healthy forest,
and I think for a variety of reasons right now we don't have a
healthy forest, a lot of which has to do with management practices.
In the past, when we just managed for board feet, we I think did
a lot of damage. I see many problems now as we manage species
by species. This is not unlike the Bay delta where we manage for
one fish and decimate another.
Mr. Dooley pointed out the other day as we draw concentric cir-
cles through the forest to protect different species it is a nonsen-
sical pattern that emerges and probably puts a lot more pressure
on those areas that aren't covered by concentric circles and neces-
sitating that some management scheme be set up for them.
But I guess if our goal is the health of the forest, which is what
I am concerned about, then isn't setting up some type of standard
like a pre-European regime not necessarily the only way to do that?
Have you scientifically determined that?
36
Mr. Owens. I think I agree with you. Perhaps we are all trying
to find a desired future condition that fits with the needs of the for-
est ecosystem to develop a sustainable forest ecosystem and at the
same time deal with the amazing pressures that are on particularly
the Sierra Nevada forests, development from the urban centers, et
cetera. I think this is a process that is still in flux, but I agree that
we need to move as deliberately as we can into defining a workable
scheme, a strategy for ecosystem management.
Mr. Lehman. Thank you.
Mr. DOOLEY. Mr. Doolittle.
Mr. Doolittle. I guess I would just observe I find it amazing
that some groups have as a goal to take us back to pre-European
settlement. We don't do that in any other area of national policy
that I can think of. Why should that even be seriously con-
templated?
None of the conditions affecting human beings are at all the
same. We lead a much more complex lifestyle. Through industrial-
ization, et cetera, we have a dramatically higher quality of life. I
would question the very assumption that that should be a desirable
target to go back to pre-European settlement. I don't think that
that would be desirable in any other area of life that I could imag-
ine. I can't resist commenting that it would be ludicrous to base
our forest management practices on such an undesirable assump-
tion.
Mr. Owens. If I might have a word here, those forests that ex-
isted 100 years ago in California were healthy, functioning forest
ecosystems, and it was only as man came along and first high grad-
ed them and then suppressed fire that the forests began to be
threatened by a variety of problems.
When I say that my vision is of a forest that attains those
presettlement conditions, it is a forest that doesn't have the fuel
loads that have now been brought about by past agency mis-
management and that will be a forest that can sustain commu-
nities in the Sierra Nevada for literally generations to come.
Mr. Doolittle. I don't think anybody quibbles with the idea of
the sustainable yield, although I hear that term thrown around. To
me, that is what we have been doing for a long time. People work-
ing in the forest cutting trees aren't going to cut them all down and
put themselves out of business. It is my understanding that sus-
tainable yield is a concept that has been practiced for years any-
way. I do agree with that.
Certainly the forests are in horrible condition as anybody knows
who has flown over them or been in them on foot. I think this for-
est health bill that Mr. Lehman has is an excellent approach to ad-
dress the needs of the forest, try and bring some common sense
and rationality back to this system that will not only improve the
forest but allow people to earn a living who wish to live in the for-
ests.
I am not necessarily attributing any of this to you, but it con-
cerns me when I see efforts basically designed I believe to elimi-
nate the multiple use of the forests and a level of logging that is
perfectly reasonable and acceptable and does no harm but is part
of this process of maintaining forest health.
Thank you.
37
Mr. DOOLEY. Thank you, Mr. Doolittle.
I have a question I would Hke to ask the panel, specifically Mr.
Hofmann. I know you have been involved with the Quincy Library
Group which is trying to incorporate an ecosystem approach, to get
many of the people with interest in a management plan of a par-
ticular part of the forest to participate and try to reach some agree-
ment. Do you see this legislation as providing support for that, as-
sisting that? And how is that Quincy Library Group proceeding at
this point?
Mr. Hofmann. Mr. Chairman, I think that the Quincy Library-
type groups would be formed and fostered through this legislation.
This legislation encourages local groups to get together. Through-
out the Sierras we have groups that are idealizing the Quincy Li-
brary Group that would like to follow those footsteps, but it is very
hard to sit down at the table and look at each other after years of
being on opposite sides of the fence.
To get the Quincy Library Group took the county supervisor, a
neutral party, that brought both of them together and said I think
we have some common areas here.
Congressman Lehman's bill would foster a consensus group to
begin with. The entire ecosystem that the Quincy plan is based on
does not allow management of the entire ecosystem base. At this
time, they don't have consensus on how to manage every inch of
that land. They have a consensus over part of that area. So they
have agreed to stay away from some areas, the roadless areas,
some of the semiprimitive wilderness areas. They are not included
in any kind of management plan at this time. They hope later to
move into that.
I think that is one of the values of Congressman Lehman's bill.
Let's get together and talk, examine areas that we do agree on,
how to manage some of the lands that is maybe close to commu-
nities, that is well overgrown, that needs to be thinned out, some
of the area where extensive salvage is required. We can agree on
some of those areas. Let's begin there, move out from there.
And Congressman Lehman's bill would allow 5 years to move out
into areas that don't have that consensus today. So I think his bill
would quite a bit foster Quincy Library-type groups throughout
California.
Mr. DoOLEY. Mr. Owens or Mr. Francis, do any of your organiza-
tions participate in the Quincy Library Group?
Mr. Owens. Mr. Dooley, two of my past board members have
been participating in either the Quincy Library Group or the AMA
group in Ashland. My observation is that these are works in
progress. They are also very unique across the West. I think the
forest plan sets up 13 different AMA's. My observation is you can't
legislate these opportunities.
I came here from Eureka, California, Humboldt County, Califor-
nia, and in that area in which the rhetoric and polarization is ex-
tremely rigid even today trying to create a stakeholders' dialogue
within a very short period of time would blow it up. I think they
have to be nurtured, but I don't think you can legislate them.
Mr. Francis. As an organization, the Wilderness Society does not
participate in the Quincy Library Group, but we do have members
38
of our organization who probably do work with the group. But as
a society we don't participate.
Ms. Heissenbuttel. I would like to make a comment not on the
workings of those groups but on the reasons for the conditions of
our forests in California today.
I am a native Califomian and spent 14 years of my career work-
ing in the forests of the Sierra Nevadas, Yosemite, the Sierra Na-
tional Forest and on private land, and with that experience I can
tell you what I have learned is that the biggest problem we have
for forest health is a result of our fire policies, not from logging.
We have as serious difficulty in the national parks where we don't
practice logging as we have had on the national forest, and most
of the private lands are in far better condition. I just need to make
sure we understand that.
Mr. DOOLEY. Thank you.
Mr. Lehman, do you have any further questions?
Mr. Doolittle.
With that, I think we will bring this hearing to a close. We ap-
preciate all the people who participated in the hearing. Without
question, there isn't going to be any action on this legislation this
year, but this is setting the groundwork for significant consider-
ation of this approach in the coming year, and we appreciate your
contributions to development of that next year.
The hearing is adjourned.
[Whereupon, at 10:50 a.m., the subcommittee was adjourned, to
reconvene subject to the call of the Chair.]
39
STATEMENT OF
JOHN HOFMANN, VICE PRESIDENT
GOVERNMENT AFFAIRS
CALIFORNIA FORESTRY ASSOCIATION
Before the
Specialty Crops and Natural Resources
Subcommittee of the
House Agriculture Committee
MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:
I am John Hofmann, Vice President of Government Affairs for the
California Forestry Association. We appreciate the opportunity to
express our views on H.R. 4068, "The California Forest Ecosystems
Health Act. "
The California Forestry Association supports H.R. 4068. This
legislation is in harmony with the vast majority of reports
commissioned by this committee and others in recent months. It is
a proactive forest health ecosystem bill that recognizes
California's political structure, forest history and diversity, in
combination with science to provide healthy forests and healthy
communities. It follows the President's advice to "insist on
collciboration, not confrontation."
California is a state with diversified ecosystems. Many of these
ecosystems are acknowledged by state and federal agencies, the
environmental community and the forest products industry as
unhealthy, but not in a state of collapse. Even in northern
California, the Fish and Wildlife Service recognizes the abundance
of northern spotted owl populations. Passing this legislation
40
would follow the recommendations of the GAO's recent report to
demonstrate ecosystem management in areas where problems or issues
have not become intractable and where flexibility exists to
coordinate activities across ecosystems. California's
diversification can demonstrate the applicability of ecosystem
management principles over a wide array of ecosystems. The test of
ecosystem management will be the restoration of forest health.
California's historical forests were open with the trees set apart
in groups. John Muir, in 1894, wrote: "The inviting openness of
the Sierra woods is one of their most distinguishing
characteristics. The trees of all of the species stand more or
less apart in groves, or in small irregular groups, enabling one to
find a way nearly everywhere, along sunny colonnades and through
openings that have a smooth, park-like surface." The Sierra Nevada
Ecosystem Project team found that "natural environmental conditions
and a history of frequent, light to moderate fire disturbance,
combined with periodic drought, intervals of episootic insect
activity, and occasional catastrophic fires, created a fine-scale
landscape pattern of many small patches, or landscapes that are
mosaics of patch conditions... Fine-scale here refers to patches
that typically range in size from less than one hectare (about 2
acres) to a few tens of hectares (or acres)." (SNEP, pg. 9)
Fire, used by native Americans, limited regeneration. Like the
chainsaw, fire cuts trees down, but in their infancy. As
California settlers appeared in the mid-1800 's, fire exclusion
41
favored young tree growth. As the canopy closed, the young growth
of native shade intolerant species died, leaving an linderstory of
the more fire-prone, shade toleraint species, such as white fir.
When the nation cried for wood products at the turn of the century,
removal of the overstory left a forest of non-native, shade
tolerant trees, void of the openness necessary to perpetuate the
shade intolerant pines. Had fire continued simultaneously with
logging, a perpetuation of "Muir's" forest may have continued.
Forest Service Chief, Jack Ward Thomas, testified on August 29
before the Senate Subcommittee on Agricultural Research,
Conservation, Forestry, and General Legislation, that the forest
health problem is the result of two existing conditions: 1) too
many trees and 2) many trees are the wrong species. Earlier this
year, the California Forestry Association joined the Wilderness
Society, Sierra Cliib, Natural Resources Defense Council, and many
local groups in advocating forest thinning through natural fuels
treatment. Twenty-one members of Congress joined us in our efforts
to obtain funding. The California Forestry Association also
supports H.R. 4742, "The Forest Fire and Pest Emergency Act"
introduced by Congressman Herger, which applies natural fuels
treatment through the emergency provisions of NEPA in extreme fire
risk areas. H.R. 4742 is a short term solution to reduce the fire
risk in extreme fire risk areas until ecosystem management plans
can be developed. H.R. 4068 is a long-term solution to thin the
forest and grow the right trees.
42
Forest thinning has proven effective in reducing forest mortality.
Attached to my testimony is a report of a research study conducted
on the Lassen National Forest in California. In 1978-79, plots in
eastside pine, mixed with white fir and incense-cedar were
estciblished to analyze the effects of thinning on pest emd
diseased-caused tree mortality. After fourteen years, plots
thinned to 40% of basal area have not lost a single tree while
plots vintreated have an average mortality over 30 trees per acre.
Plots thinned to 55% and 70% have averaged 1.8 to 2.3 trees per
acre mortality respectively.
H.R. 4068 recognizes that many decisions of ecosystem management
are subjective. Scientists can justify the delineation of an
ecosystem as small as a rotten log or as large as the universe. An
ecosystem can be a geographic area, such as a roadless area,
wilderness, riparian zone or a watershed. It can be based on
species; the giant sequoia, coastal redwoods, high elevation fir or
mixed conifer. It can revolve around a community, such as the
Quincy Library Group or the Tahoe Basin. It can be defined as
serai stages, grasses and forbes, young forests, intermediate
forests, mature forests and old growth.
The GAO suggests that forest health is the baseline for ecosystem
management, yet it too is subjective. Forest managers recognize
the value of dead and down wood but too much turns the forest into
an extreme fire risk. Every ecosystem relies on regeneration, but
too much jeopardizes the entire ecosystem. Since ecosystems
43
include humans, forest health must sustain ecosystem complexity and
provide for a level of human needs .
The desired forest condition has been under constant debate. The
historical forest condition provides a perceived baseline for
forest health and plant and animal habitat. Historical forests fit
the lifestyles of the native inhabitants. They may not be
desirable today. Ecosystem managers must recognize human uses of
forest resources have changed.
Subjective decisions such as ecosystem boundaries, forest health
and desired forest condition require public policy based on good
science, good social /economic data and strong local public
involvement. Local environmental groups and industry are
struggling in many areas to reach consensus on forest management.
The Forest Service, National Park Service, Fish and Wildlife
Service, and the Bureau of Land Management have signed agreements
with California state agencies, to work with local governments,
environmental groups and industry in a bio-regional council to
develop a coordinated statewide biodiversity planning strategy for
ecologically similar regions throughout California. This
legislation would work through established bio-regional councils
and foster local consensus groups such as the Quincy Library Group
and the Siskiyou County Roundtable to resolve subjective decisions.
"The California Forest Ecosystems Health Act" provides flexibility
in the delineation of ecosystems. An exemption from NFMA's forest
44
bovindaries allows ecosystem mcinagement plans that cross forest
boundaries. The public and the Forest Service will jointly develop
an individualized ecosystem management plan for each identified
ecosystem recognizing that each ecosystem is unique.
Accountability follows the Vice-Presidents direction that the
government will be performance driven. Performance will be
measured in acres treated, not in board feet produced. The
legislation limits public debate over the desired forest condition
to a mosaic pattern that is fire-safe, insect and disease
resistant, economically viable, harmonizes all uses and recognizes
the historical condition.
A similar forest condition was demonstrated in the Ashland
watershed. Marvin Plenert, then Regional Director for the Fish and
Wildlife Service, evaluated the project and stated:
Helicopter removal of selected tree harvest was
accoirplished throughout the Forest, including areas near
owl nests. The result was that owls seemed to cope with
the 'light touch" of activity very easily, even while on
the nest, while nearly ten million board feet of timber
was removed. We do not believe that this activity has
created any threat to the survival or recovery of the
owl; indeed, we believe the Forest habitat has been
improved by creating a multi-storied cemopy with the
remaining debris for forage habitat...
45
In our view, the larger the landscape under
consideration, the more options for management to
occur. . .
When holistic management is done properly, there is no
real need for protected areas, as all areas could receive
both conservation and harvest with the overall ecosystem
in mind. In addition, this approach could eliminate the
need to list species under the Endangered Species Act
because the threats of extinction from habitat
degradation will have been sicrnif icantly eliminated. . .
We have always taken the position that good forest
management is also good wildlife management. When the
habitat reflects natural, or near natural conditions, the
species should be provided for.
The California Forestry Association recognizes the development of
ecosystem management plans will not occur over night. H.R. 4068
provides an opportunity to iirplement ecosystem management through
consensus. In areas of consensus, ecosystem management plans are
expected within two years. Through experience and communications,
the Forest Service will expand ecosystem management progressively
over a five year period.
H.R. 4068 takes a different approach to adaptive management.
Ecosystem plans are developed based on the best science available
46
with the objective of achieving healthy forests. That plein is
in^lemented cind monitored to ensure the desired results are
achieved. If changes occur or it is evident that the plan will not
reach the objective, adaptive management is used to readjust the
plan to accomplish the objective. It is not used to provide
continual experiments across the landscape. This concept is
consistent with the direction of the Sierra Nevada Ecosystem
Project progress report and the recent GAO report. 'Our knowledge
about many, if not most. Sierra Nevada ecosystems is so incoit^lete
that any management plan must be flexible enough to respond to
unpredicted ecosystem changes." (SNEP, pg. 6).
The California economy is among the most dependant upon forest
resources. Since 1990, Califojmia has lost more jobs in the forest
products industry than any other state except Oregon — over 5,000
jobs. Families, communities and the forests are loosing with the
present system. California's forests are growing at a rate of
nearly 4 billion board feet annually and with a harvest of less
than 1 billion board feet, California's forests are growing thicker
and more fire-prone each day. H.R. 4068 provides an opportunity
for change and hope.
47
FOREST HEALTH IN CALIFORNIA
In 1978-1979, eastside pine plots were established on the Lassen National Forest to analyze the
effects of thinning on pest and diseased-caused tree mortality. The stands chosen were pole-sized
pondeiosa pine mixed with white fir and incense-cedar medium to low sites, ranging in age from 70
to 90 years. Four levels of stocking density were established, 40, 55, 70, and 100 percent of normal
basal area. Fourteen years after thinning, the treatments have reduced mortality by 91 to 100
percent. Mortality was due to the mountain pine beetle and root rot.
COMMERCIAL TREE MORTALITY
(Trees per Acre)
YEAR
40%
55%
70%
100%
1980
0.0
0.2
0.2
2.4
1981
0.0
0.0
0.7
2.4
1982
0.0
0.5
0.3
3.6
1983
0.0
0.1
0.8
4.1
1984
0.0
0.0
0.0
1.0
1985
0.0
0.2
0.0
.6
1986
0.0
0.0
0.0
1.3
1987
0.0
0.0
0.0
1.4
1988
0.0
0.0
0.0
0.0
1989
0.0
0.4
0.0
2.6
1990
0.0
0.0
0.0
2.6
1991
0.0
0.0
0.0
1.8
1992
0.0
0.2
0.0
1.3
1993
0.0
0.2
0.3
5.2
Total
0.0
1.8
2.3
30.3
mean
0.0
0.1
0.2
2.3
Range
0.0
0-5
0-0.8
0-5.2
100%
Percent Mortality Reduction
96% 91%
Thinning also profoundly affects tree growth Average stand diameter increased 2 inches in the 40%
stands and only 0.1 inch in the unthinned stands. Through thinning, stands of small trees can more
rapidly be converted to stands of larger trees, conducive to late-successional dependent species.
Historical patterns of wildfire intensity can be maintained through thinning while expanded reserves
will exacerbate burn intensity Historically, approximately 12,000 acres of moderate intensity and
4,000 acres of high intensity fires have occurred annually in the Klamath National Forest. Option 12c
of the Gang of Four report would decrease moderate intensity fires to less than 9,000 acres and
increase high intensity fires to 7,000 acres annually. Option 12c is a more moderate management
approach than the President's Option 9. Effects of low and moderate intensity fires can be simulated
through forest thinning while providing forest product commodities for sustainable economies.
California Forestry Association
July 8, 1994
48
Mr. Chairman and members of the Subcximmittee,
I am Anne Heissenbuttel, director of forest planning and policy for the American
Forest & Paper Association (AF&PA). My responsibilities include issues affecting the
management of forest resources on National Forest lands such as land management
planning, ecosystem management and appeals of agency decisions. AF&PA
members are greatly concerned about the need to improve the health and condition of
many thousands of acres of public lands and to maintain healthy conditions on all our
forest lands. H.R. 4068, the "California Forest Ecosystems Health Act," provides one
approach for addressing this important issue, and I am pleased to have the
opportunity to testify on this bill today.
AF&PA is the national association of the forest, pulp, paper, paperboard and
wood products industry. The association represents more than 400 member
companies engaged in the grov\/ing, harvesting, and processing of wood and wood
fiber. Our membership includes companies which manufacture solid wood products
such as lumber, plywood and other panel products, as well as those which produce
pulp, paper and paperboard products from both virgin and recycled fiber. Many
AF&PA members rely on federal timber for part or all of their raw material supplies.
The association is also the umbrella for more than 60 affiliate member associations
that reach out to more than 10,000 companies.
49
H.R. 4068 identifies a number of issues that AF&PA believes must be
addressed by the federal land management agencies when implementing ecosystem
management on lands under their jurisdiction. Among these, the bill would:
(1) support implementation of a plan for ecosystem management "of aJl
National Forest System lands" within the boundaries affected by the bill. (Emphasis
added). Sec. 4(b).
We strongly believe that if it is to be effective, ecosystem management must be
applied across the entire national forest landscape. It must not be limited to those
lands designated as "suitable timberlands." Nor should it be applied as a set of
inviolable standards and guidelines simply layered upon previous land management
decisions and land allocations. Management activities must be designed to maintain,
enhance and, where necessary, restore the health and long-term productivity of the
entire federal land ecosystem. Moreover, activities must be consistent with the
legislative authority for agency lands.
(2) focus on the condition of the ecosystem rather than "targeted" outputs.
Sec. 4(c)(3).
We concur that on-the-ground management should focus on practices designed
to achieve and maintain an agreed-upon "desired forest condition." Some of these
50
practices will produce predictable levels of resource outputs. VvTiile output "targets"
will not drive the management process, the expected results should be predicted and
documented, and forest managers must then be held accountable to Congress and
the public for achieving the desired conditions and resulting predicted outputs.
The importance of defining the desired forest condition and working to improve
that condition on many of our forested lands has become terribly apparent this
season. As you are aware, almost 66 thousand wild fires have now burned more than
3.8 million acres of land already this year. This is 160 percent of the five-year
average and we are not yet near the end of the fire season! The acreage burned
ranks with the major wildfire years of 1987 (Northern California) and 1988
(Yellowstone).
Many scientists have warned that it is not a question of how much will burn, it is
a only a question of when, since so many of our forests today are in overstocked and
unhealthy conditions. We know that without taking action now and continuing it into
the future, we will only face more years when our personnel and funding needs far
outstep our ability to keep severe fire damage to a minimum.
It is well documented that the cost of preventing destructive fires is much less
than the expense of fighting fires and recovering the burned lands in the aftermath.
Fire suppression costs for the summer of 1994 already total more than $700 million.
51
To add to the difficulty, more homes and communities have been built adjacent to or
within the forest. Here, as well as in the more remote forest areas, thinning, salvage
logging, fuels reduction and management, as well as controlled burning where
conditions allow, provide the most appropriate and cost effective tools in any wildfire
prevention program.
Appeals to halt salvage efforts have also greatly hindered the agency's ability to
promptly begin recovery and reforestation efforts, and squelched any hope of reducing
the overall cost of the effort by recovering the value of the burned timber. The Forest
Service must be encouraged to use every opportunity within its means to expedite the
NEPA process and to recognize the emergency nature of these salvage and
rehabilitation needs so that the exemption allowed under the current appeal rules is
used wherever necessary.
(3) consider the habitat needs of all species, not single species. Sec. 4(c)(6).
AF&PA believes ecosystem management will succeed if it enables managers to
provide for the needs of all species, without the need for separate plans to protect
individual species within the planning area. It should focus on ways to achieve
desired habitat conditions needed for a mix of species, rather than provide protected
"zones" for one species overlaid or added to separate zones for another.
52
While v.'e are supportive of these general concepts, we have concerns wUh
other provisions of H.R. 4058. First, it does little to resolve the inherent conflicts
between procedures prescribed by the numerous environmental and land management
laws that have been passed over the past 30 years.
H.R. 4068 calls for the development of new "ecosystem management plans."
How. why, or whether these plans should replace the current land and resource
management plans required by the National Forest Management Act (NFMA) remains
unclear. We believe the Forest Service can and should begin to implement
ecosystem management consistent with the above principles and within the context of
the current NFMA plans. While we agree the current process does not facilitate
implementation of ecosystem management, a new type of plan is not what is needed
most. In fact, the objectives of H.R. 4068 are consistent with many provisions of the
current forest planning process and NFMA. Instead, legislation is needed to address
real conflicts between the many procedural requirements of the NFMA, the National
Environmental Policy Act, the Endangered Spedes Act, the Clean Water and Clean
Air Acts, and other environmental and management laws.
Similarly, the federal antitrust laws currently preclude much of the cooperation
among landowners that could be supported by many of our member companies. In
short, if two or more private owners or operators of land producing a commodity wish
to cooperate to achieve mutually agreed-upon ecosystem goals, that cooperation is
53
strictly prohibited by law if the result will the reduce the overall level of outputs they
produce. H.R. 4068 does little to address this problem. Please refer to the attached
paper by Wm. Randolph Smith for more information about this very real concenn.
Finally, AF&PA's vision is to ensure the continuing availability of forest products
and other resources to meet the needs and reflect the values of growing populations
by sustainably managing the forest resources of the nation. We aim to ensure that
future generations derive the same benefits from forests that we enjoy today. Our
goal is to see that private and public forests are sustainably managed by the year
2000. We believe that public lands can achieve sustainable forestry through
ecosystem management.
54
ANTITRUST A>fD ECOSYSTTtH >'7''^'^>']'.HKT: NO GOOD
L-rii,u GOfcS trrti^UttlSHED
Remarks Before Forest Policy Center Symposiiim
en Ecosystem Management
Wm. Randolph Smith
Crowell & Moring
Tale School of Forestry and Environmental Studies
October 22, 1993
Like Marc Antony supposedly said about Julius Caesar, I am
here today to praise your efforts, not to bury them. But as a
former government prosecutor and the resident antitrust lawyer, I
am obliged to tell you that the sort of landscape and ecosystem
management plans being discussed at this symposiiun do raise
serious legal issues beyond the Endangered Species Act, issues
which carry with them real risks of liability. I titled my
presentation "No Good Deed Goes Unpunished" to help focus your
attention on these antitrust issues.
Now, your first reaction probably is "It simply cannot be
right that efforts tc further important social goals, and to
comply with federal law, can be an antitrust violation. This guy
must be just another Washington bloodsucker trying to manufacture
a legal problem where none exists . "
Kail, I will not argue that the Washington bloodsucker should
be on the endangered species list. At least in our natural
habitat along Pennsylvania Avenue, we are surviving and even
multiplying. And there is one sub-species that does not rely on
hourly fees for nourishment, but feeds on prosecuting antitrust
violations. I am talking about government lawyers at the Justice
55
- 2 -
Departnenr and the Federal Trade Commission. And just in case you
think antitrust enforcement is dead, or even that those guys have
enough sense not to sue someone for trying to protect the
environment, let me mention some examples of their recent feeding
frenzieax
1. It was not so long ago that the doctors, lawyers and
engineers thought their professional status placed them above
the ordinary trade and commerce that is subject to the
antitrust laws. But they have been proven wrong time and
again. The particular case I have in mind is one in which a
group of lawyers defending indigent criminal defendants
banded together to get the local government to increase
support. Legal services for the poor sounds like a good
thing, but the government prosecuted this group for illegal
collusion, and the Supreme Court upheld the government's
victory.
2. Second, you might be comforted to know that the Fish and
Wildlife Service is not the only federal agency that thinks
about prosecuting state officials. The FTC actually has sued
state agencies and even cities for antitrust violations.
3. And to find the most recent example of antitrust
aggressiveness, you need look no further than the ivy covered
hall in which we sit. You have probeibly heard that a group
of universities had worked together for years to rationalize
financial. aid, so college students could select their school
56
- 3 -
based on quality and fit rather than dollars. But the
Justice Department had a different view, called the
universities 'competitors," and sued them on the theory that
they should be fighting for students rather than cooperating.
So, you can see that all the good intentions in the world are
not necessarily enough to avoid antitrust exposure.
Now let me get specific. How exactly can a landscape
management plan run into antitrust problems? The answer is when
two or more private owners or operators of land producing a
commodity are part of a landscape management plan that involves an
agreement to reduce output.
Output reduction is almost essential in any habitat
conseinration in a timber context, because the basic strategies
include limiting the harvest levels through sequencing rules,
allocations, extended rotations, and increased set asides. I
realize the intent of such a plan is to benefit the environment.
But the economic effect is to reduce the total supply of logs
available to the marketplace. And even a non-economist like me
knows rhat when supply goes down, price goes up.
Of course, the antitrust laws do not prohibit every instance
when supply is reduced. Rather, the focus is on agreements among
competitors that reduce competition. That is why I noted the
point about two or more private owners or operators being
involved. Let me illustrate with three scenarios.
In the first, all the land covered by a particular plan is
owned and operated by one party. That individual company is free,
without fear uf antitrust liability, to develop a habitat
57
- 4 -
conservation plan that sets its production level wherever it
wants. Because there is no agreement among competing producers,
there is no antitrust problem.
My second example has public and private land in the plan,
but all the private land is under single ownership. If the public
land is either reserved or being harvested by the same firm, no
competitive situation arises. But if a second company is logging
the public land, there could be a competitive problem.
Finally, we have the obvious situation, which we expect to
become increasingly common as the scope of plans broadens, where
the land is owned by multiple private parties. Here is the
antitrust lawyer's view:
In the absence of a plan, each of those individual ovmers
would decide when and how much to produce. Those would be
independent, competitive decisions that would, in our free market
system, optimize production.
But a landscape management plan changes all that. These
competitors now are getting together to agree on how to harvest
their land; setting maximum levels , sequencing, and deferring
some production. And to reach that agreement, they may have to
share information about production plans and even pricing, for
example in figuring out how to compensate a landowner whose
prop>erty is being set aside under the plan.
Imagine if you will the sane practices in another setting.
Let's pick on the oil companies. Suppose a group of oil company
executives get together and decide to cap wells and thereby limit
production. They do not fix prices, but all of them know that, if
58
- 5 -
the supply is reduced, prices will go up and they will make more
money. The courts have consistently condemned such conduct as per
se illegal, and, in extreme cases, it can even be a criminal
violation of the antitrust laws. Acain, the key is the collective
action that eliminates competition. And the public policy reason
for this law is fairly obvious.
Note that it does not matter if the oil company executives
had the greater good in mind rather than their own profits. Let
us ass\une they explained that their action would reduce reliance
on foreign oil and reduce auto emissions, to make the nation more
secure and improve air quality. You might or might not believe
them, and that skepticism is part of what underlies the antitrust
rules. But let me assume it is a true intention because they will
give all of their excess profits to charity. The simple answer is
they are still guilty.
The reason is that the Supreme Court has said that the
relevant subject under the antitrust laws is competition, and
competition alone. The Court announced that rule in a case
involving an association of civil engineers, who developed an
ethical standard that they would not bid on construction jobs.
Their sincere belief was that if engineers were forced to cut
their fees, they would cut comers in designing bridges and
buildings, which could then jeopardize public safety. The Supreme
Court flatly rejected this defense, not because it did not believe
the engineers, but because competition is so importamt to the free
market economy.
59
- fi -
The point is that the only environment that matters for
antitrust purposes is the competitive environment.
Now, this does not mean that the antitrust laws necessarily
will bury ecosystem management, to return to my opening theme.
There are several ways to address this legal risk. Let me touch
on them here.
The first is a purely legal position that the Endangered
Species Act represents an implicit amendment to the antitrust la%«
that immunizes legitimate efforts to comply. That issue has never
been addressed by the courts, and, as you can imagine, the courts
are very reluctant to imply an exemption without specific
direction from Congress. Thus, at this point it is an argument,
but that is all it is and it is not one I would bet on winning.
Second, state governments offer real promise. The antitrust
law recognizes that sovereign states can decide to displace
competition in certain markets with some other form of government
regulation. It has to be clear state policy, and it has to be
actively supervised by the state government, but conduct that
meets that standard is completely immune from federal antitrust
enforcement. So, where landscape management plans are mandated or
expressly authorized by state law and supervised by state
agencies, they should not create antitrust risk. It is not easy
to satisfy this state action immtinity requirement, but it can be
done with advance planning.
A third possibility is to approach the Justice Department for
approval. The current administration is sounding more aggressive
themes these days. It just turned down, for exeunple, a request by
60
- 7 -
leading phanraceutical companies to permit them to set maximum
price increases so they could reduce health care costs. So I
%rould not be optimistic, but it may be possible to obtain a no-
action letter from the Justice Department in a paxticular
situation. That would not, however, guarantee that a private
plaintiff %rauld not be allowed to bring suit.
Finally, there is the option to ask Congress to clarify the
law. There have been references in this symposium to legislation
being necessary for further implementation of ecosystem management
initiatives. A clarification that legitimate efforts to comply
with the ESA and other federal laws are exempt from the antitrust
laws could be crafted. If passed, such legislation would be the
surest and safest course for all concerned.
So my bottom line today is that, while these antitrust
concerns with ecosystem plans do not make, joint efforts pointless,
the legal issues should be recognized and dealt with. Raising
this sort of issue now hopefully will allow you to avoid real
roadblocks in the future.
61
'^'^7^^^''
THE WILDERNESS SOCIETY
STATEMENT OP MICHAEL FRANCIS, DIRECTOR, NATIONAL FORESTS PROGRAM,
THE WILDERNESS SOCIETY, BEFORE THE UNITED STATES HOUSE OP
REPRESENTATIVES, SUBCOMMITTEE ON SPECIALTY CROPS AND NATURAL
RESOURCES, COMMITTEE ON AGRICULTURE, ON H.R. 4068, THE CALIFORNIA
FOREST ECOSYSTEMS HEALTH ACT, OCTOBER 6, 1994
Thank you Mr. Chairman and members of the Committee for the
opportunity to testify today on H.R. 4068, the California Forest
Ecosystems Health Act. The Wilderness Society (TWS) is a
national conservation organization with 272,000 members, 52,000
of whom reside in California. As this Committee is aware, The
Society is recognized as a leader in the national debate over
forest and natural resource policy and the evolving doctrine of
ecosystem management. I request that a recent outline addressing
ecosystem management prepared by The Society be included in the
hearing record.
While we would like to thank Representative Lehman for
bringing the issue of ecosystem management before this Committee
and the Congress, The Wilderness Society opposes H.R. 4068 in its
current form. H.R. 4068 is unnecessary, unscientific, costly,
and would perpetuate the bias toward timber production, albeit
disguised as "ecosystem management," which has resulted in
serious and well-documented environmental problems in our public
forests. Regretfully, H.R. 4068 would fail to protect, and in
fact, would encourage the logging of the remaining ancient forest
ecosystem and roadless areas in all of California's national
forests.
* H.R. 4068 is unnecessary and redundant. The National
Forest Management Act currently provides more than adequate
authority and direction to the Forest Service to incorporate
ecosystem management principles into its management activities
(see for example, 36 CFR §219 . 1 (b) (3) . Moreover, the Forest
Service under Chief Thomas has embraced ecosystem management as
its guiding policy nationally. In addition. Region 5 of the
Forest Service has recently issued draft ecosystem management
guidelines to implement the Chief's new policy in California.
H.R. 4068 is not needed at this time.
Mr. Chairman, at a Congressional hearing only a few weeks
ago, your Committee heard testimony from the General Accounting
Office which found that "Federal agencies are beginning to
implement ecosystem management" (Ecosystem Management, Additional
Actions Needed to Adequately Test a Promising Approach,"
GAO/RCED-94-111) . Ecosystem management is a complex and evolving
900 SR V F. NTF F. N TH STREET, N >X' W A S H I N C> T () N , D C; 2 0 0 0 (>
(202)833-2300
62
doctrine and deserving of a thoughtful, comprehensive review by
Congress before Congressional action is warranted.
* H,R. 4068 is not based on science. It prejudges the
outcome of ecosystem planning, for example, by eliminating
corridors and other special management areas. Not only is this
contrary to current scientific thinking about ecosystem
management as evidenced in President Clinton's Forest Plan, it
also prejudges the outcome of two administrative processes
underway in California that are focused on ecosystem planning in
the Sierra Nevada range - the California Spotted Owl
Environmental Impact Statement and the Sierra Nevada Ecosystem
Project. In fact, the Sierra Nevada Ecosystem Project was
initiated by a $150,000 appropriation from Congress in the FY
1993 Interior Appropriations bill. Because this study, to be
completed by December of 1995, will provide critical information
on the Sierra Nevada ecosystem, H.R. 4068 is premature as well.
* As currently drafted, the scope of H.R. 4068 is too broad
and too poorly defined. H.R. 4068 would require the preparation
on new "ecosystem management plans" for all of the national
forests in California, including those in northern California,
thus preempting the California portion of President Clinton's
Forest Plan. In fact, the Administration lauds this plan as the
best example of an ecosystem management plan, a characterization
that H.R. 4068 ignores. In addition, H.R. 4068 does not
adequately establish the need for new plans, either in the Sierra
Nevada or the four national forests in Southern California as
well. H. R. 4068 would result in a costly and unnecessary
expenditure of taxpayers' funds to develop these plans. Also,
H.R. 4068 fails to acknowledge the role state and private lands
play in ecosystem protection and provides no guidance for
planners to integrate their work with new ecosystem initiatives
on federal lands.
* H.R. 4068 would also set an unacceptable precedent with
national implications by supplanting the National Forest
Management Act. Again, the need to replace NFMA has not been
clearly demonstrated, neither to this Committee or to the public
at large, nor has the rationale been provided to justify special
treatment for California's forests when many of the same
conditions pertain on national forests in other states.
* Though the actual language in H.R. 4068 is somewhat
vague. The Society is concerned about provisions that appear to
be inconsistent with the goals of the National Environmental
Policy Act. For example, H.R. 4 068 intends to grant preferential
authority to local communities in developing ecosystem plans for
national forest lands.
* Finally, TWS is concerned that the conception of
ecosystem management inherent in H.R. 4 068 is biased toward
commodity production and hostile to ecosystem protection.
A basic tenet of ecosystem planning missing in H.R. 4068 is
the critical need to protect those areas that are functioning
63
well while working to restore natural processes and functions on
degraded areas. Rather than do that, H.R. 4068 requires the use
of adaptive management across the landscape. Furthermore, it
presumes that human managers possess sufficient information and
capabilities to manage the entire landscape without preservin<j
any particular area. Not only is this presumption unscientific,
but it is also indicative of the same arrogance and ignorance
that has created the environmental problems we face throughout
the national forest system today.
In conclusion, Mr. Chairman, Because of the concerns
discussed above, we oppose H.R. 4068. In addition to sxobstantive
problems with the bill, we feel that the legislation would
preempt current administrative initiatives and is therefore not
needed at this time. We are however, eager to work with you,
other members of your Committee, and Mr. Lehman to explore other
ideas in the continuing evolution of natural resource policy and
the implementation of meaningful ecosystem protection and
management.
Thank you for the opportunity to share our views on
ecosystem management in the national forests of California.
64
fifc^^Aee^
The Wilderness Society
ECOSYSTEM MANAGEMENT
Ecosystems are functional divisions of the biosphere, i.e., geographically defined units
composed of air, water, minerals, microorganisms, fungi, plants, and animals,
including people. They exist at all spatial scales -- from smaller than a rotting log to
larger than a region, such as the northern Rocky Mountains.
Ecosystem Management is a new approach to environmental management based on
an evolving appreciation for the complexity of ecosystems and peoples' relationship to
their environment. Its ultimate objective is to sustain the generative capacity of the
earth by protecting biologicai diversity and the productive potential of ecosystems.
Maintaining potential is necessary to safeguard the ability of future generations to meet
their needs. Thus, ecosystem management may be considered the process of
achieving sustainability.
Principles - The following characteristics of ecosystems provide the basis for
ecosystem management:
Ecosystems are structured hierarchically. They occur at all spatial scales from
the smallest microcosm to the biosphere. Larger scales set the context for
smaller scales; smaller ecosystems provide the content of larger ecosystems.
Ecosystems can be characterized in terms of pattem and process, where
pattern includes both composition (the kind and quantity of physical and
biological components) and structure (their physical arrangement). Process
refers to the interrelationships and dynamics that bind ecosystems together.
Ecosystems are continually changing in response to key processes. The rocky
intertidai zone reflects the action of tides and waves; riverine systems are
dominantly affected by hydrology. In terrestrial ecosystems, an important
process affecting ecosystem character is disturbance, including fire, insect
outbreaks, and treefalls. Characteristic patterns, intensities, and frequencies cf
disturbance influence the nature of ecosystems.
People, like all organisms, are affected by the quality of their ecosystems.
People also affect their ecosystems and are important, integral members of
ecosystems at larger scales. The effects of people on ecosystems range m
intensity from minimal effects on chemistry to complete urtsan replacement
Ecosystems can be extraordinarily complex. Understanding complexity is a
continuous and evolving process. Traditional approaches to management -a\.e
assumed ecosystems to be far more simple than they are now understooc to
be. Sustaining complex ecosystems will require far greater humility towara -e
environment than has been demonstrated m the past.
The \\ litk'll:!.----- "MKietV
^Jiiii vvcnicL'iiili s(ivc[. \A\ . Wa^liMiuiun DC Juiiiio-JS^i) ■ 2(i2 S33-2.-^ni)
65
Elements - A strategy for management based on these principles should:
build from a hierarchically ordered ecosystem classification system that
recognizes the integrity of regional ecosystems. Several systems exist that
delineate "earth space" in a meaningful hierarchy.
identify the processes that shape ecosystem patterns and seek to sustain
patterns and processes.
integrate and account for the role of people. One feasible approach would
include areas specifically devoted to human use, natural areas devoted
specifically to the conservation of nature, and an experimental landscape
dedicated to mutual goals. Natural areas are necessary for the conservation of
some elements of biodiversity; they also have cultural, educational, and
scientific value and can provide important "ecosystem services".
include a short-term strategy to protect the most imperiled elements of
biological diversity and a long term strategy to live sustainably (i.e., to restore
the ecosystem processes that sustain biodiversity and productivity).
include a formal feedback mechanism to allow continual reassessment and
reaction based on the status of the ecosystem. This process has sometimes
been called "adaptive management."
Implementation - Based on these principles and elements, we propose the following
process for the implementation of ecosystem management:
1 ) Identify appropriate regional ecosystem boundaries and characterize the
patterns and processes that sustained diversity and productivity historically.
2) Characterize the current condition of regional ecosystems with respect to those
patterns and processes.
3) Provide interim protection for imperiled ecosystem elements and/or functions.
4) Through public participation and the democratic process, develop a 'vision of
the future" for each regional ecosystem that sustains diversity and productivity.
5) Federal agencies and local authorities, working cooperatively, develop sets of
alternative management options to achieve that vision.
6) Select an alternative through the open participation of all interested parties.
7) Through adaptive management, continuously monitor the success of the plan m
achieving the vision, and continually revisit the vision and revise the plan based
on information gained.
66
STATEMENT OF
JIM OWENS
EXECUTIVE DIRECTOR, WESTERN ANCIENT FOREST CAMPAIGN
Before the Subcomirdttee on Spedalty Crops
and Natural Resources
Committee on Agriculture
Concerning
H.R. 4068
Ctdifornia Forest Ecosystems HetJth Act
October 6, 1994
Mr. Chairman, and Members of the Subcommittee:
My name is Jim Owens, I'm the Executive Director of the
Western Andent Forest Campaign, which represents grassroots forest
activists from California, Oregon and Washington in their efforts to
protect the remaining Andent Forest ecosystems of the Pacific West.
Today I am also representing the Sierra Nevada Alliance, a broad
coalition of California community leaders and activist groups interested
in the protection and restoration of the Sierra Nevada. The activists,
groups and coalitions I represent appredate this opporturuty to
comment upon H.R. 4068, the California Forest Ecosystems Health Act.
H.R. 4068 has been extensively reviewed by concerned dtizens
in California, and I will take this opportunity to summarize some of
1
WESTERN
Ancient Forest
CAMPAIGN
Capitol Oflice
Jim Owens.
Executive Director
Phone 202 / 939-3324
1400 16th Street NW
Suite 294
Washington, DC 20036
Fax 202/ 939-3326
E-mail WAFCDC
@ igc.apc.org
Board ot Directors
Tim Coleman
Republic. Washington
Paul Ketcham
Portland, Oregon
Cyndi Lewis
Seattle, Washington
Tim Lillebo
Bend, Oregon
Drew Martin
Senicia. California
Tim McKay
Areata. Calitcrnia
Enn Noel
N San Juan, California
AOvisoiy Soaril'
Nigel Blakely, Ph 0
Black Hills Audubon Society
David Chism
Areata. California
Ed Grumoine, Ph D
Sierra Institute, UCSC
Bruce Honeyman
Friends ol Lake Fork
Jim Jont2
Silver Lake. Indiana
Bill Lazar
Lazar Foundation
James A Lichatowich
Alder Fork Consulting
James Monteith
Save the West
Julie Norman
Headwaters
Arthur Partndge, Ph D
Forest Watch
Christopher Peters
Seventh Generation Fund
Glen Spam
Pacific Coast Federation
of Fishermen s Assns
Susie Van Kirk
North Group Redwood
Chapter, Sierra Club
Robert Van Meter
Los Angeles Audubon
Kimery Wiltshire
The lllilouette Fund
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their comments for this Subcommittee's review. I have also appended to my
written testimony a letter concerning H.R. 4068 sent to Congressman Rick Lehman
by Mr. John Buckley, Executive Director of the Central Sierra Environmental
Resource Center ir\ Twain Harte, California, for Inclusion in the record of this
Subcommittee hearing.
H.R. 4068 correctly recognizes the need to shift the Forest Service's
management of federal forests from a commodities-oriented strategy to an one
based on principles grounded in sound scientific findings and recommendatioris.
The bill's stated goal of providing for an ecosystem approach to forest management
is laudable; unfortunately the bill itself contains provisions that fall outside the
definition and practice of ecosystem management.
H.R. 4068 is noteworthy for its recognition of the unique forest ecosystems of
California's forest ecosystems, most of which I have visited or lived among during
my previous life as a resident of California and the ovwier of an outdoor recreation
store in San Francisco.
I also applaud the author of H.R. 4068 for his timely recogrution of the role
wildfires will play in futvire management scenarios developed for the forests of
California, and his interest in acting proactively to address fire issues in the context
of ecosystem management. As Assistant Secretary for Natural Resources and
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Environment Jim Lyons stated during a hearing on Forest Health on Tuesday,
October 4, our society must decide whether to address forest health and fuel
management problems now, before the next cycle of wildfires, or expect to pay the
cost of fighting fires in the future. Assistant Secretary Lyor\s used the phrase "Pay
now or pay later, " which I think is applicable to the forests of California.
It is heartening to read H.R. 4068's language condemiung targeted outputs;
for years the environmental community has pointed out the destructive effect of
timber quotas, also called Aimual Sale Quantities, on the viability of forest
ecosystems across the nation.
I also appreciate H.R. 4068's recognition of the need to approach forest
management on a landscape basis, which takes into accoimt the habitat needs of all
of the living creatures associated with forest ecosystems. And I am impressed that
H.R. 4068 includes the requirement of scientifically credible monitoring standards
and guidelines as part of its definition of ecosystem management. Mctny activists
believe that the Forest Service already is required by the National Forest
Management Act (NFMA) to monitor forest resources. In their view, many of the
crises that have afflicted Califorrua's federal forests, such as landslides, habitat
destruction and the extirpation of wildlife and aquatic spedes, could have been
avoided by implementing and funding NFMA's monitoring requirements. This bill
is a welcome affirmation of the need to incorporate monitoring in the ongoing
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management of public lands
With all of that said, however, I must state for the record that the activists,
groups and coalitions that I represent strongly oppose H.R. 4068, for the following
reasons:
1. H.R. 4068 seeks to suspend Section 6 of the Forest and Rangelctnd Renewable
Resources Planing Act of 1974, which provides for the development and
implementation of land and resource management plans for each unit of the
National Forest System, and the participation by the public in the
development, review and revision of land management plans at least every
fifteen years. In addition to providing for public involvement in the
development of contemporeiry forest management plans. Section 6 of the
Forest and Rangeland Renewable Resources Plarming Act of 1974 details
guidelines for the protection of waterways, wetlands and their water quality
and fish habitat. H.R. 4068 fails to guarantee dtizen involvement in forest
planning from the very inception of planning documents, and also fails to
adequately address the need to protect California's water and fisheries
resources.
This last failing has serious implications, given that biologists in California
have consistently warned that the state's native fisheries, and their habitat.
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are in grave danger. The loss of future riparian habitat, whether to logging,
road construction or other forms of development, v«ll spell certain extirpation
for a number of fish stocks. I don't think that this is a path that the author
of H.R. 4068, the Congress or the people of the State of California wish to
pursue, nor should this bill's failings in this regard be allowed to pass out of
Congress.
The ability of the public to participate in Forest Service dedsion-making
affecting federal forests in California under H.R. 4068 is unclear. While
existing federal laws guarantee citizen involvement in the development of
dedsion-documents by Forest Service offidals, H.R. 4068 fails to recognize
these existing statutes, and may serve to limit public partidpation in agency
dedsions affecting public lands to an advisory role. Since there is no
apparent time limit on the life of H.R. 4068's ecosystem management plans, it
appears that there is no mecharusm in the bill to trigger reevaluation of plans
characterized by poor initial public input and review.
2. The bill specifically discards corridors or spedal management areas that are
critical to ser\sitive spedes. California's forests currently provide habitat for
sensitive terrestrial and aquatic spedes, induding furbearers, birds and
salmonids. The Forest Service has moved to protect a number of these
spedes with spedal management areas and habitat corridors which are part
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of management strategies specifically developed to protect key spedes in
California's forest ecosystems. H.R. 4068 would eliminate and repudiate
these preemptive efforts to prevent the further loss of unique wildlife and
fish species that are peirt of this nation's veduable heritage of natural
resources.
3. H.R. 4068 attempts to use the standard of "vigor" in judging the success of
future ecosystem management plans. This is an artificial standard that fails
to t£ike into consideration the role that mature trees play in providing habitat,
genetic diversity and structure to California's forests. "Vigor" is not the orUy,
or best measure of a healthy, functioning forest ecosystem; other outputs,
such as the number of salmon returning to California's streams and rivers, or
the ability of forests to respond to drought, insect infestations, disease, or
exposure to poor air quality surrounding urban centers, should be used in
place of vigor as an ecosystem principle guiding future m2magement of
federal forests in California.
4. H.R. 4068 relies upon Adaptive Management as a tool to manage public lands
under ecosystem management plans. Unfortunately, the concept of Adaptive
Management, as spelled out in fhe Northwest Forest Plan's provision for
Adaptive Management Areas in Washington, Oregon and Northern
California, is an experimental concept that has not yet been tested. The
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environmental conununity, which has seen Forest Service plans and projects
adversely affected by pressure fron\ timber communities adjacent to and
reliant upon federal forests, opposes any untested concept that places more
control over federal lands in the hands of those v»rhose commerded Interests
in conunodities available from these lands outwreighs the interest of citizens
across the nation, bom and unborn.
Mr. Chairman, this bUl is obviously the product of a significant amount of
effort on the part of its author, who has a dose relationship with the Sierra. It
serves to broaden the dialogue regarding an issue that the 104th Congress will
address, namely the definition and implementation of ecosystem mtmagement.
Unfortunately, it fails to tcike into consideration the steps already teiken by the
Forest Service to depart from failed polides of the past that focused on the primacy
of commodity extraction at the expense of other public vjdues, such as pure
drinking water resources, wUdlife and fisheries, and recreational and aesthetic
opportunities.
Today, the Forest Service is engaged in a comprehensive effort to
sdentifically aruilyze the resources of the Sierra Nevada, and develop long-range
ecosystem management strategies that address a broad range of resource tind
development issues. Already, the agency has developed, and begun to implement,
recommendations of the California Spotted Owl Report (CASPO). The California
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Spotted Owl Interim Guidelines and Environmental Assessment was released in
January, 1993, and the Environmentcd Impact Statement for the California spotted
owl is stiU pending; the efficacy of the strategies developed by these reports, and
others to be implemented by the Forest Service in the future, will not be fully
evaluated for several more years.
H.R. 4068 would derail CASPO, and serve to sidetrack the scientific analysis
currently being undertaken by the Forest Service. For that reason, passage of H.R.
4068 would waste the valuable time and taxpayers money that has gone into Forest
Service research and analysis.
While H.R. 4068 offers a different strategy for dealing with California's
federal forests, I urge this comnnittee, and Congress, to reframe from acting on it, in
the interest of allowing ongoing federal process to develop ecosystem management
strategies based on sound scientific data and analysis, that can be evaluated
alongside this bUl, and others.
Mr. Chairman, this concludes my testimony. I look forward to responding to
any questions or conrtments you and others on the subcommittee may have.
74
Central Sierra Environmgntal ppgource Center
Box 396 Twain Hartc, CA 95383 (209) 586-7440
March 15, 1994
To: Grey Staples /Congressman Rick Lehman
Fax: (202) 225-4273
Phone: (202) 225-8331
Prom: John Buckley, CSERC Hxecudve Director
Dear Grey:
Having been in the thick of national forest timber issues for the last 14 years
in the Sierra Nevada, I've watched the national forests evolve from a over-
whelming bias toward timber production lo the current situation where most
forests arc actually poised for a significant shift toward ecosystem management.
But rather than encourage that evolution, your bill blatantly ignores the
scientific justification for such a shift, throws open protected areas to potential
logging, and contradicts key biological protective measures now in place. It forces
experimental management across entire sections of national forests, and it gives
local commodity users greater consideration than other members of the public.
The environmental community will strongly oppose any such legislation,
based both on biological reasons and philosophical grounds.
Key Objections:
1) We object to an emphasis on adaptive management over proven methods.
The timber industry has repeatedly urged "adaptive managment" which would let
them log more and avoid restrictions on cutting old growth trees. The indvislry
prefers to try "experimental" techniques, while the scientists advocating CASPO
guidelines rejected such adaptive management techniques except for very limited
circumstances.
Page 4 - ADAPTIVE MANAGEMENT; Adaptive management is described in the
bill as "the experimental and monitored application of scientifically derived
management decisions". On pages 6 and 7, the bill requires the Secretary of
Agriculture to develop plans that include adaptive management techniques.
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IWfi 0 Adtpltv* inwug«in«nt ttduUques acroM any
ItoMatlan^ Tht scientists convoked by the CASPO
/llttdjrt^ccted Mtopttve maiMgement logging because such
^^^iri^mitl Bictftods oould eliminate options for the future when there is still
Iconstdertble uncertaixtty concerning the status erf late successional species.
We urge that adaptive management be limited as desalbed within ihe
CASPO guidelines.
2) The bill specifically discards corridors or special management artas thai are
critical to sensitive species. On page 8, the bill sets a goal for forest conditions that
are (ii) "designed in such a way as to obviate the need for corridors or special
management areas to meet the needs of given species or situations;" On page 9,
under (6), the bill prohibits requiring "tiie allocation or categorization of tracts of
land for specific preselected ecosystem management results."
These two sections would eliminate "set-aside" protection fur all of the
sensitive spedes, species of concern, or other key values that have been mitigalions
for many destructive timber sales and development of areas that have occurred in
the past.
To interfere in any way with the establishment of SOHA's, PAC's, Goshawk
Territories, or furbearer territories or corridors means that logging will have access
to areas that are now off-limits. Your bill will be opening the door to cutting in the
remaining islands of late successional serai stage habitats — areas that are already
diminished below the necessary level for many species. This wording gives loggers
a foot-in-the-door to the very areas that have escaped them for decades.
Broad management across the landscape cannot take the place of setting key
corridors and special areas aside for complete protection. We oppose any such
intention.
3) A similar, but even more dangerous section of this bill, would open up the
entire imreserved land base to "ecosystem" logging and other commodity-oriented
uses. This would mean that roadlcss^ areas, near natural areas, riparian zones,
special wildlife areas, and all the recreational lands that are now managed for
distinct purposes would be thrown open to potential logging.
On page 10, "(8) Application across the entire unreserved land base" calls for
such mangemenl, and further below, a similar requirement is described under
(1)(A), "considers the entire landscape in a management unit of the National Torest
System covered by a plan". CSERC and our supporting groups vehemently object to
any opening up of any remaining wild islands of habitat, or any wildlife emphasis
areas, or any of the others areas that are now managed for other than timber values
within the unreserved land base.
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4) The bill mandates greater emphasis on the desires of lo^aLinterested parlies
than on the general public as a whole. This is just another way of acquiescing to the
call for "local control" that's been the battle-cry for "Wise Use" groups for the last
few years.
On pages 11 and 12, it reads: "...the Secretary shall develop the plans through
the use of public involvement programs that emphasize input from residents of
local communities to be affected by the plans. '
This is a sell-out to industry pressure. Local community responses from
those who stand to profit from more logging, or more graizing, or more
development will ALWAYS be dominated by those who profit from extracting
resources from the national forests. The 99% of people v^ho actually use national
forest lands and do not live locally will ALWAYS favor greater levels of proteclion.
We strongly oppose any emphasis on input from local residents, since this
emphasis wUl always mean less proteclion of the resources than if the full range of
public concerns were evaluated objectively.
5) There arc nunierous important sections of words within the bill that are
either incorrect or show bias.
On page 2, (1) states that "recent forest management policies have often resulted in a
degeneration of the forest structure and a loss of forest health and vigor". If '"recent" is meant to refer
to p£>licic$ implemented over the last two years, this statement is inconrect. Rather than continue llic
past degradation and fragmentation of the forest, CASPO policies have begun to minimize habitat
fragmentation and protect key resource values. 'Ilic wording should be corrected or deleted.
On page b, the definition of Ecosystem Management Is somehow twisted to mean rt»uun.« supply
and demand, neither of which should be factors in managing for the health of biological systems.
Biological sustalnability and diversity arc the goals of ecosystem management, with some levuls uf
products resulting from such maiugcmcnt. I'he demand for a product should not be a consideration.
On page 8, (D) sets a goal to "maintain the economic well-being and subiliiy of communities In
areas dependent upon national forest resources;". Such a goat is contradictory ti> true ecosystem
nwnagcment, where the longterm health of the resources is the priority, not cxtrdiiing resuuiccs lo kc<:p
local industries profitable. Local industries have always had fluctuating markets and boom times, long
before protection of habitat began lo limit timber sales. The goal should l)c to provide sustainable
levels of products to local commuiUiles, NOT lo maintain ecv>nomic well-being .
Page 9, under (4), 'incorporation of vegetation management techniques Into the pre^rribcd
activities" Is a nebulous, open-ended statement that may justify the intensive use of hi-rbicldcs or other
"techniques" to increase timber outputs. There's no reason for this ambiguous statement to be lnclud<sd.
Ihank you for considering these strong objections. Respectfully,
0
John Buckley, CSERC
^
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STATEMENT BY GRANT BUNTROCK, ADMINISTRATOR
AGRICULTURAL STABILIZATION AND CONSERVATION SERVICE
U.S. DEPARTMENT OF AGRICULTURE
BEFORE THE
COMMITTEE ON AGRICULTURE
SUBCOMMITTEE ON GENERAL FARM COMMODITIES
U.S. HOUSE OF REPRESENTATIVES
OCTOBER 6, 1994
Mr. Chairman and Members of the Subcommittee, I am happy to be with you this
morning to discuss the economic situation facing com and soybean producers and the recent
downturn in corn and soybean prices.
Feed grain and soybean prices have weakened significantly since late June, primarily
because a favorable growing season has led to prospects for large 1994 corn and soybean
crops. Corn prices have declined from $2.61 per bushel in June to $2.09 per bushel in
September (as reported by the National Agricultural Statistics Service). Soybean prices
declined from $6.72 per bushel to $5.31 per bushel during the same period.
I would like to take this opportunity to: I) review the supply, demand, and price
situation for corn and soybeans; 2) review the reasons for selecting a 7.5 percent Acreage
Reduction Program for corn; and 3) discuss actions, currently under review in the
Department of Agriculture, that could help support feed grain and soybean prices.
The 1994 soybean crop is shaping up to be a record for both yield and production.
The U.S. average yield is forecast to reach 38.2 bushels per acre, more than half a bushel
higher than the 1992 record, and over 6 bushels higher than the 1993-crop yield. The
September production estimate of 2.3 billion bushels would exceed the 1979 record by 50
million bushels and will be produced on neariy 10 million fewer acres.
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2
Current projections are for 1994-crop soybean prices to average $4.75-$5.75 per
bushel, significantly below the $6.40 per bushel average price received by farmers for
1993/94, but unlikely to be low enough to trigger large Federal payments under marketing
loan provisions. We expect soybean export demand to rise sharply in 1994/95, spured by
large U.S. Supplies and soybean oil prices to remain strong due to the relatively tight world
market situation. These market factors will likely provide some support for soybean prices
in the months ahead.
The Agricultural Act of 1949, as amended, provides the Secretary with limited
opportunities for taking action to support soybean prices. One action is that, if on
January 1, 1995, the Secretary determines that the national average price of soybeans for the
1995/1996 marketing year would be less than 105 percent of the announced nonrecourse loan
level, soybean plantings on optional flex acres (OFA) would not be permitted. In the past
three years, the restriction has not been in effect, and approximately .5 million acres of
soybeans have been planted on OFA. A reduction in soybean plantings of 5 million acres, if
it were to occur, is normally appropriated with a 5-10 cents per bushel increase in soybean
prices.
The Export Enhancement Program has been used to assist in exporting soybean oil,
indirectly supporting soybean prices. Since, worid vegetable oil prices remain relatively
high, U.S. Soybean oil is competitive, and program activity is expected to be low. If
soybean oil prices on the world market were to fall, we would be prepared to use existing
program authorities to maintain our competitive position in export markets.
The 1994 corn crop is estimated to be the second highest on record. Despite low
com stocks heading into the 1994/95 marketing year, total supplies are estimated to be up
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3
during the September through November period then rise gradually through most of the
remainder of the marketing year. Corn prices are expected to average between $2.00 per
bushel and $2.40 for the 1994/95 marketing year.
Deficiency payment rates for 1994-crop feed grains will likely be higher than our
projected payment rates announced last January, offsetting some of the income loss from
lower feed grain prices. Deficiency payment rates are currently estimated to be higher than
the projected rates by about 15 cents per bushel for corn and sorghum, 5 cents per bushel for
barley, and 20 cents per bushe) for oats.
A bright spot on the demand side of the corn balance sheet continues to be strong
domestic demand, estimated at 7.0 billion bushels, and neariy 200 million bushels above the
1992/93 record. One concern with regard to domestic demand in 1994/95 and beyond is the
U.S. Court of Appeals' injunction on September 13 to stay implementation of the
Environmental Protection Agency's Renewable Oxygenates Standards (ROS). If
implemented, the ROS would have mandated that 15 percent of reformulated gasoline come
from renewable sources such as ethanol in calendar year (CY) 1995. We continue to assume
that the ROS will be implemented. We will be carefully watching the outcome of the court
order as well as tracking the amount of corn used to convert into ethanol.
Corn exports for the 1994/1995 marketing year are estimated at 1,475 million
bushels, up 175 million bushels from the 1993/94 level, but still the second lowest export
level since 1985/86. One situation of particular interest is China, with its surging food
inflation, and uncertain corn supplies. Many trade analysts are currently carrying com
export forecasts for China that are 2 to 6 million tons (75 to 200 million bushels) below
USDA's estimate of 12 million tons for 1994/95. USDA has recently had a team in China
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4
examining the corn situation. We expected to reassess China's export prospects in the
Departments next supply and demand estimate report, scheduled for release on October 12.
The preliminary 1995 Feed Grain Acreage Reduction Program (ARP) percentages
were announced on September 30. The acreage reduction levels are 7.5 percent for com,
and zero percent for grain sorghum, barley, and oats. Given trend yields, 7.5-percent
acreage reduction level for corn is expected to drawdown ending stock levels about 150
million bushels and improve average corn prices about 5 to 10 cents per bushel compared
with current estimate for 1994/95. Under a 7,5 percent ARP, net farm income is expected to
be nearly $250 million higher than if a 12.5 percent ARP had been announced. The 7.5
percent ARP was recommended by several national associations. Also, fifty-six percent of
the producers commenting favored a corn ARP of 7.5 percent or less. The 1995 feed grain
acreage reduction percentages can be revised until November 15, if supply and demand
conditions change significantly from the September estimates.
Next, 1 would like to discuss actions that some have suggested that could help bolster
feed grain and soybean prices. These include allowing entry of 1994-crop feed grain loans
into the Farmer-owned Reserve (FOR), delaying settlement of outstanding 1993-crop loans,
and increasing the 1994- and 1995-crop feed grain and soybean price support rates.
First, let me discuss the FOR. The Agricultural Act of 1949, as amended, requires
the Secretary to announce the terms and conditions of the 1994-crop feed grains FOR by
March 15, 1995. Entry of feed grains is mandated when both of the following conditions are
met: (1) the average market price for corn for the 90-day period prior to announcement is
less than 120 percent of the loan rate, and (2) the estimated com ending stocks-to-use ratio
(S/U) for the current marketing year is greater than 22.5 percent. Entry is discretionary
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5
(S/U) for the current marketing year is greater than 22.5 percent. Entry is discretionary
when only one condition is met, and no authority for permitting entry exists if neither
condition is met. There is no authority to allow for grain to enter the FOR before the end of
the 9-month loan period.
The price condition was met on September 12, the Secretary has the authority to
announce that maturing 1994-crop feed grains loans may enter the FOR. However, opening
the FOR would have limited impact on market prices. The Secretary may announce the
opening of the FOR anytime before March 15, 1995.
Another option under consideration is to delay settlement of outstanding 1993-crop
loans. Since the outstanding quantities of 1993 feed grain crop loans are relatively small
(57 million bushels as of September 20), this action would not likely affect market prices.
Also, current cash redemption values for 1993-crop loans are well below market prices. For
example, in the case of corn, the cash redemption value is $1.77 per bushel compared with
cash prices of around $1.95 per bushel.
Lastly, I would like to talk about price support rates. The 1994 feed grain price
support rates were increased 17 cents for corn and grain sorghum, 14 cents for barley, and 9
cents for oats above 1993 levels. These rates were announced in February of this year.
Currently, cash quotes for corn are near the 1994 county price support rates in some
locations of the Cornbelt. Cash quotes for soybeans are about 40 cents per bushel above the
county price support rates. Generally, one would expect com and soybean prices to reach
seasonal lows during the harvest period (September through November). Large program
outlays could occur if corn and soybean prices fall below the price support rates for extended
periods. As of September 20, no marketing loan benefits have been earned.
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6
statute, oilseed price support rates must be announced by November 15. There is no
statutory deadline for announcing feed grain price support rates. However, this year the
decision on support rates will likely be made in an environment in which cash prices are near
the price support rates and the potential for large marketing loan outlay looms. For com,
each one cent exposure to marketing loan gains/loan deficiency payments potentially
increases program outlays by about $80 million. For soybeans, the current midpoint of the
estimated range of the season-average price for the 1994/95 marketing year is $5.25 per
bushel, but, normal seasonal and spatial price variation could cause prices to dip below the
$4.92 loan level for a short period of time in some areas. For soybeans, each one cent
exposure to marketing loan gains/loan deficiency payments potentially increases program
outlays by about $23 million. The potential for large marketing loan outlays could influence
the 1995 Farm Bill discussions, which will provide an opportunity to review the methods for
determining price support rates as well as other program provisions.
In summary, immediate actions that can be taken to support market prices for feed
grains and soybeans are very limited. However, we believe the recently announced
preliminary 1995-crop feed grain ARP's will help strengthen market prices, and we are also
considering other actions that should lend support to feed grain and soybean prices. This
completes my statement, Mr. Chairman, and I will be happy to respond to questions.
83
STATEMENT OF
TERRY BARLIN GORTON, ASSISTANT SECRETARY FOR
FORESTRY AND RURAL ECONOMIC DEVELOPMENT
CALIFORNIA RESOURCES AGENCY
Before the
Specialty Crops and Natural Resources
Subcommittee of the
House Agriculture Committee
MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:
I am Terry Barlin Gorton, Assistant Secretary for Forestry and Rural Economic Development
for the California Resources Agency. We appreciate the opportunity to express our views on
H.R. 4068, "The California Forest Ecosystems Health Act."
On behalf of the Resources Agency of California, I would like to commend the effort
reflected in the California Forest Ecosystems Health Act. After reviewing the Act, the
Resources Agency also commends the initiative taken by the California forest industry in
supporting the Act's development.
The Resources Agency of California finds great merit in advancing the application of
ecosystem management in California. The designation of a range of forest conditions as a
management goal represents a major advance toward ecosystem management. We can no
longer focus on individual species or isolated resources in developing long-term management
strategies for our wildlands. This bill provides a beginning opportunity to agree on a set of
criteria that can be used in setting forth those long-term objectives. We need an inclusive
program in California where diverse lands and needs require rethinking solutions to resource
problems that cut across political boundaries.
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In some parts of California it will be difficult to implement ecosystem management on
U.S. Forest Service lands alone. Many of the important ecological functions on California
forestlands - fire, habitat use by wildlife species, water flow through streams - involve large
areas of land. Where National Forests constitute large, contiguous blocks, the U.S. Forest
Service may be able to implement ecosystem management largely on its own. Recent
preliminary analysis by the California Fire Strategy Committee shows that perhaps less than
half of the US. Forest Service land in California could be managed in that way. However,
even in these areas, some functions, such as the movement of anadromous fish from the sea
to spawning areas, require the participation of other landowners and agencies in planning
efforts. Where private and U.S. Forest Service lands are co-mingled, functions such as fire
and habitat use by wide-ranging wildlife species will require considerable collaboration
between the U.S. Forest Service and other landowners if ecosystem management is to
succeed.
In order to implement ecosystem management successfully, monitoring across ownership
boundaries must be strengthened . The initial designation of a desired range of forest
conditions should be seen as an initial best estimate based on current ecological and social
understanding. That estimate may in fact overlook critical biological or social concerns.
Monitoring of biological and social systems will highlight such oversights or surprises and
allow for a correction in management as a matter of course, rather than as a matter of crisis,
as has too frequently been the case heretofore.
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The biological and social linkage of lands across ownership boundaries requires a high
degree of public participation in ecosystem management planning. The Resources Agency has
supported the development of bioregional councils and watershed groups by which
stakeholders are empowered to deal with ecosystem issues in their local or regional areas.
These citizen groups provide the U.S. Forest Service with an ideal means by which to
develop ecosystem management plans that meet the biological and social criteria of ecosystem
management and create a constituency for their implementation.
The Resources Agency supports the California Forest Ecosystems Health Act and looks
forward to participating with the U.S. Forest Service in its implementation. Thank you for
your consideration of these comments.
86
Testimony of
Keith Heard, Executive Vice President
National Com Growers Association
to the Subcommittee on General Farm Commodities
Committee on Agriculture
U.S. House of Representatives
October 6, 1994
The National Com Growers Association (NCGA) appreciates this opportunity to discuss
the economic outlook for com farmers and to suggest changes to the feed grains program
that can improve the profitability of com production. My name is Keith Heard. I am the
Executive Vice President of NCGA and represent the more than 28,000 members of the
National Com Growers Association.
The 1994 com crop is expected to rival the 1992 crop in size. The anticipated harvest ~
well in excess of 9 billion bushels — has caused a precipitous drop in com prices from
levels above $2.60 per bushel through June of this year to the estimated September price
of $2.09. The September prices are particularly troubling because the ending com stocks
for the 1993 crop year were only 850 million bushels.
There are many who blame the low prices on the decision of the Secretary of Agriculture
to establish the 1994 com acreage reduction program (ARP) at zero. While the zero ARP
is undoubtedly a factor, it is essential to point out that weather is the dominant factor in
determining the size of a crop. Especially at low levels, year-to-year changes in unpaid
setasides only modestly impact the size of the crop and the price of com. An ARP that is
too high will discourage program participation. In 1992, when the ARP was 5 percent,
the total acres planted to com exceeded the number of acres planted this year. One reason
for this seeming contradiction is that the 5 percent ARP and relatively high com prices
during spring planting prompted many farmers to stay out of the program in 1992.
Producers not in the program were able to increase acreage planted to the program crop.
So rather than limiting production, an ARP that is too large can actually lead to base
building and increased production.
This is not to suggest that the acreage reduction program is unimportant. In comments
filed with the U.S. Department of Agriculture, NCGA recommended that the ARP for the
1995 com crop be set at 7.5 percent based on September estimates of 1994 production
and anticipated demand for the 1994 and 1995 marketing years. However, given the
inherent limitations of ARP, future policy should focus less on acreage reduction and
more on providing farmers the necessary tools to maximize profit. These tools include
crop insurance to help producers manage financial risk, greater flexibility for program
participants, an improved marketing loan and Farmer Owned Reserve, expanding markets
from trade reform and from new, industrial uses within the United States, and a
regulatory climate that avoids burdensome restrictions and paperwork.
87
NCGA applauds the hard work of the agriculture committees and the Federal Crop
Insurance Corporation in completing crop insurance reform. This legislation will lower
crop insurance premiums, which should mean that more farmers will avail themselves of
the protection offered by crop insurance. One of the important advantages for insured
producers is the ability to price a crop when market opportunities occur even though the
crop has not yet been produced. Farmers with a sound marketing strategy can avoid low
prices at harvest.
At a subcommittee hearing earlier this year, Pete Wenstrand testified on behalf of NCGA
that we were evaluating the concept of normal crop acreage. Such a program would
enable producers to plant the appropriate combination of program crops, oilseeds, alfalfa
and forage given market expectations and agronomic and environmental considerations.
While NCGA has not endorsed a "'normal crop" or "whole farm base" concept, we are
convinced that in most instances farmers are in the best position to evaluate the choices
for their farming operation. Undoubtedly, there will be occasions when individuals miss
marketing opportunities or when weather causes an unexpectedly large or small crop, but
farmers would make the planting decisions that will maximize profit on their farms.
The loan program is intended to bolster harvest prices by removing grain from the
market. If current com prices are to improve in the near term, it will be necessary for
program participants to store much of the 1994 harvest. The loan rate for 1994 com is
higher than it has been since 1 986, which should encourage com loans and allow farmers
to hold grain until prices improve. However, if prices do not stabilize and decline further,
farmers will be able to realize marketing loan gains as income protection against prices
below their county loan rate.
Although the loan rate is higher than in recent years, it is still too low. Congress
established a minimum loan rate at 85 percent of a 5-year average price. However, the
law also provides for reductions from the minimum loan rate to avoid accumulation of
stocks and to retain market share and to retain a competitive market position. At the time
Congress passed the additional provisions to lower the loan rates. Congress anticipated
that the marketing loan provisions for grain would not be implemented. But the 1990
budget act included a mandatory marketing loan for wheat and feed grains, if multilateral
trade negotiations under the General Agreement on Tariffs and Trade (GATT) were not
completed by June 30, 1992. Since the negotiators did not meet this deadline, wheat and
feed grains have had a marketing loan since 1993. The provisions for lowering the basic
loan rate should not apply to marketing loans since a properly implemented marketing
loan will not result in the accumulation of stocks and will ensure that U.S. grain remains
competitive.
The 1 995 farm bill should require continuation of marketing loans for wheat and feed
grains and should establish a minimum national loan rate that cannot be reduced below
85 percent of the 5 -year average price.
88
The Farmer Owned Reserve is another example of a program that was included in the
1990 farm bill with the expectation that marketing loans would not be available for
grains. Since the Secretary is not required to announce the terms and conditions of the
com reserve until March 1 5 of the year following harvest, farmers are placed in the
difficult position of having to decide between loans, loan deficiency payments and
potential opening of the reserve without knowing the full extent of those options. The
Secretary of Agriculture must announce his decision on the Farmer Owned Reserve
immediately. The Secretary has been limited by the statutory requirement that the
average market price of com be below $2.27 for 90 days, and the Secretary can only
announce that the program will be available when nine-month loans mature, but this is
important information for producers and must be announced as soon as possible. The
restrictive nature of the FOR precludes the Secretary from responding to the legitimate
concems of producers who face com prices well below the FOR trigger. Revision of the
Farmer Owned Reserve should be a priority for the 1995 farm bill.
The United States is the largest producer of com in the world, but this world
predominance does not assure profitability for U.S. producers. We must compete in
foreign and domestic markets with other grains that can be readily substituted for com in
livestock rations and we must overcome trade barriers that have the effect of keeping U.S.
com out of some markets. European Union export policies have the effect of cheapening
the value of wheat which has displaced com in several important markets. The Umguay
Round of GATT represents the first step in reducing these export subsidies which should
make com more competitive in world markets. The North American Free Trade
Agreement included specific quotas for exports of com to Mexico. Strong, consistent
demand for exports of bulk commodities and value-added products will do much to
improve grain prices even when we have a bumper crop.
Domestic feed demand remains the most important market for U.S. com, but food and
industrial uses have increased steadily over the past two years. We expect feed demand
to increase with enhanced world trade in meat and meat products. Demand for food and
industrial uses will continue to grow as new products that replace fossil fuels with
renewable energy sources are developed and brought into widespread commercial use.
Federal policy should eliminate impediments to sound agricultural practices, such as crop
rotations, and should encourage farmers to conserve our natural resource base through
research, education, and voluntary, incentive-based environmental and conservation
programs. At the same time, policy makers must recognize the adverse economic impact
of regulations on producers. The limited flexibility of the current program does not allow
farmers to respond to the changes in farming that have taken place over the last decade.
The 1995 farm bill should be designed to give producers the freedom to manage their
farms in the manner that will best achieve the goals of profitability and environmental
responsibility.
Thank you for holding this hearing and for considering the concems of the National Com
Growers Association.
89
SIERRA rT\ C L U B
\'0R [HERN CALirOK.VtA. N EVADA.- Ivs^S^S^^I HAWAII riHLD OFFICE
October 20, 1994
Statement of Frannie Hoover, Sierra Club Califomia/Nevada/Hawaii
Representative, for the record of the October 6, 1994 U. S. House of
Representatives' Agriculture Committee's hearing on H.R. 4068, the
California Forest Ecosystems Health Act
Tliank you for this opportunity to submit a statement into the hearing record
en H.r! 4068, the California Forest Ecosystems Health Act introduced by
Represenlativo Rick Lehman.
Title Sierra Club does not support H.R. 4068. This bill would completely
change the management of national forests in U.S. Forest Service Region 5
(California) over a five-year period, between 1995 and 2000. It would seriously
turn back existing efforts to restore the ecological health of California's
national forests and set a terrible precedent nationwide for exemptions from
existing laws protecting forests anfl wildlife.
Under this legislation, the U.S. Forest Service would be directed to create
"ecosystem management plans" that would have as a goal "restoring the
health and vigor' of national forest lands in California. The bill would
require the Forest Service to apply "adaptive management," which is defined
as experimental techniques, to all California national forests. Oiily areas
which have received special Congressional designations prior to passage of
this legislation, such as wilderness, wild rivers, and Special Management
' Areas would be exempt from this new form of management.
The bill would override the Forest and Rangelands Renewable Resources Act
of 1974, the National Forest Management Act of 1976, all existing standards
and guidelines, and other laws such as the Endangered Species Act (by
limitmg how species could be protected).
The bill identifies several overarching concerns to be addressed through
"adaptive management." One is the belief that fires classified as "intense" are
increasmg and, without changes (according to Rep. Lehman's press release
accompanying introduction) "it is all going to burn up and there vwll be no
forests, no habitat, no fish and no wildlife." Another is the desire to increase
the "health" of stands of timber, which appears to be an open door to massive
amounts of salvage sales, which are not the appropriate way to deal with fuel
loading problems. Tlic bill specifically requires the Forest Service to
"maintain the sustainable economic well-being and stability of commmuties
in areas dependent upon national forest resources." And it specifically
prohibits establishment of any kind of special management areas (reserves),
•1171 PIEDMONT AVE.X'UE «2(VI O.^KLA^•D, CAIJFORMA 0+611 '510) 6.''4-7R4r FAX (510) 6S4-43.-.6
90
corridors, or other units designed tor species protection. Instead it would seek
to protect species through creating a "mosaic" of stand ages across the
landscape.
The bill would override the Administration's plan to protect northern
spotted owls and ancient forests (Option 9) on northern California forests
because it prohibits reserves and corridors. It would eliminate Caiifomia
spotted owl protections (CASPO) in the Sierra Nevada. It would eliminate
protections for giant Sequoia groves established in the Sequoia National
Forest Mediated Settlement Agreement and by Presidential proclamation.
These changes are all completely unacceptable and would decimate existing
efforts to protect forests and wildlife.
The bill would remove all region-wide standards and guidelines and instead
would allow the Forest Service great flexibility to set up experimental goals
and procedures essentially wherever it deems fit.
Overall, the ecosystem management plans must consider the entire landscape
(i.e., open it all up for manipulation and timber cutting) and benefit both
renewable resources (i.e., trees) and the "human resource in or dependent
upon the management unit."
The bill gives greater emphasis to local residents' input on management than
to the public as a whole, "through the use of public involvement programs
that emphasize input from residents of local communities to be affected by
the plans." This approach leaves out the concerns of environmentalists and
other citizens who do not live in communities in or near the forest. It will
leave private citizens at a disadvantage because local volunteer citizens do
not have the resources or the daytime hours to devote to these kinds of
meetings that the timber industry and other commercial interests do.
H.R. 4068 is premature and conflicts directly with known recommendations
of distinguished scientists. It predates the scientific findings of the Forest
Service's comprehensive Sierra Nevada Ecosystem Project (SNEP) study and
is thus putting the cart before the horse. In addition, the bill is non-scientific
because it prescribes one approach to preser\'ing the forests while barring
others. Although it is supposedly based on science, allowing adaptations in
management based on new knowledge that comes from experimentation, the
experiments will be flawed from the beginning because they do not allow use
of a control group —i.e., leave some of the forest alone.
The bill would make forest management completely experimental. While it
requires that monitoring be done, it allows full experimentation across the
landscape, without existing protections of law. Tliere is no provision for
long-term preservation of existil^g ecosystems. It abo disallows some of the
91
best known approaches for preserving ancient forest ecosystems and species-
reserves and corridors where little or no human manipulation occurs.
The bill inappropriately emphasizes local community input, upsetting the
historic balance that equally weighs input from all sectors of the American
public. It also continues local communities' overdependence on a single
commodity resource, and does nothing to help improve commuruty stability
through economic diversification.
Perhaps most alarming of all, this bill creates a completely separate
management regime for an entire region of the country's national forests— an
untested and experimental approach that would make California's national
forests the guinea pigs of the National Forest System. If major revamping of
national forest management is to be done, it must be done on a national basis
and with the input of all relevunt interest groups and Members of Congress.
Thank you for this opportunity to share the Sierra Club's views on this bill.
92
National Grain and Feed Association
Statement of the
National Grain and Feed Association
before the
Subcommittee on General Farm Commodities
Committee on Agriculture
U.S. House of Representatives
October 6, 1994
Mr. Chairman and members of the subcommittee,
my name is Kendeil W. Keith. I am president of the
National Grain and Feed Association. Members of our
Association include 1100 companies in the grain and feed
business comprising 5,000 facilities and including coun-
try elevators, feed mills, merchandisers, grain processors,
feeders and exporters. Included in our membership are
some 37 state and regional grain and feed associations,
representing more than 10,000 companies nationwide.
A Good Year for U.S. Agriculture
Mr. Chairman, our industry is pleased that U.S.
agriculture and farmers in particular are probably headed
for one of the most profitable seasons in recent memory.
Figures 1 and 3 present the projected net revenue to
producers, above variable costs, for the 1 99 1 to 1 994
U.S. com and soybean crops, respectively.
Net revenues above variable costs to com farmers in
1994 are expected to reach $13.3 billion, a substantial
increase over the 1993 crop in which farmers were restricted
by both government acreage idling programs and a flood in
the midwest Net revenues to soybean farmers are also up,
and expected to be in the range of $7.5 billion.
Market prices are down somewhat. No question
about it. That is the way a market is supposed to work
when we have an abundant production year. But there is
good news too, as markets are responding very favorably
to more adequate supplies and the outlook for demand is
much improved from last year. Another bit of good news
is that because of the outstanding productivity, average
production costs are much lower. Variable costs of com
and soybean production this year are expected to be $2.00
per bushel of soybeans and $ 1 .09 per bushel of com, $.32
and $.39 per bushel lower than last year, respectively.
The increase in bushel output, making more bushels
available for sale, coupled with the decreased production
cost, provides a substantial increase in net returns avail-
able to the farmer for covering fixed costs, management
expense, family living costs and added profits.
Still, market prices are a concern to the producer.
Farmers do need a price that makes farming profitable,
but price is only one of the factors contributing to farm
profitability. Production is extremely important too. In
fact, the Iowa farmer that produced 45 bu./acre soybeans
in 1992 with market prices of $6.50 will generate the
same market revenue this year with a yield of 5 7 bu./acre
at a price of $5.10.
Measuring Farm Profitability:
Profit = (Price — Cost) x Production
Volume
Three market variables affect net farm income : pricfi,
production cost and volume of production. Which is most
important'^ While the biggest concern always seems to be
93
Figure 1
. Corn -- Net Returns Above Variable Costs .
for J991-1994 Crops/Correlafionlb Production
Figure 3
Soybeans, -5 Net Returns ^bove Variable Costs
for 1991-1994 Crops/torielation to Productiori
91/m 92/W
Figure 2
Figure 4
Cotn^Avg. Farm Price
199HO 1994 Crob Years
nm «/w 9V94 "x/w
Soybeans —Avg. Farm Price
1991 foi 1994 Ctop Yeats
orice, the experience oflhe last four vears provides strong
e'/idence that n'-ndiiction is more important and, in fact,
preoccupation with marlcet price can and has led to maj or
policy mistakes.
cant factor related to a positive increase in net farm
income is production. In those years with high levels of
production, 1992 and 1994, net revenue above variable
cost; was40 percent higher than in 1991 md 1993, yjvs
of lower production. Net income from the marketpiace
was higher, and, interestingly, net income from govern-
ment prog-^ms was also higher, ^in the last four years,
government payments have, in fact, seemingly added to
the inter-year variability in producer returns, rather than
contributing to greater stability.) Market orices have, in
fact, been negatively correlated with net farm revenue in
the last four years (Figures 2 and 4). This may be
surprising to some, hut it is consistent with the view that
the U.S. does indesd compete in a global agricultural
economy where prices are influenced much more by global
supply/demand factors, than by our own production.
These charts (Figures 1 -4) are demonstrating a very
important principle: PRODIJCTTON PAYS! The
market rewards production and economic etTiciency.
Greater output is associated with greatc" income, both for
producers and everyone involved in the production-mar-
94
keting-processing chain. Viewed in this context, the
administration's preliminary decision to implement a 7.5
percent ARP for 1995-crop com makes no sense. We
believe that the administration should revisit this prelimi-
nary decision, and announce a 0 percent ARP for all feed
grains for 1995. This principle has extremely important
policy implications as we begin discussing the 1 995 farm
legislation.
Improving Farm Profitability
How do we improve farm profitability? The U.S. has
tried for decades to improve farm profitability through
production constraints in an effort to boost market price.
The preceding charts demonstrate the recent unproductive
experiences with this strategy. The plain and simple fact
i.s:itha.sn'twnrkpH In fact, supply controls have had the
opposite of theirintended effects Constraining output in
this more open global economy, while other countries
continue to produce full tilt, has led to a declining ability
to earn revenues from the marketplace.
With a tunnel vision focused solely on price, the U.S.
has continued outdated supply management policies very
much to the detriment of everyone involved in agriculture.
Some people would suggest that we have "always" idled
acreage, and we have simply reoimed to the days similar
to the production of the early 1970s, prior to the large
Soviet Union grain purchases. The truth is though, the
U.S. has taken anextremepositionnf idling hiigeamoiint<;
ofacreage, futilely trying to raise worid price levels, and
we have dug ourselves into a cavernous hole. We have
placed ourselves in a substantially diminished position
compared with our long-term historical position as a
supplier of agriculmral products in worid markets.
In recent years, acreage idling programs, including
CRP, ARPs and 0/85, have been so heavily used that
idlings once reached20 percent of the tillable acres in the
U.S. If you review where this has placed the U.S. in the
order of worid suppliers, it is shocking. Consistently for
30 years, between 1955 and 1985, the U.S. produced
between 24% and 27% of world output of grains and
soybeans. Since 1985,wehavedippedsharplybelowthis
long term position, and today the U.S. is only producing
about 22% of global output. (See Figure 5.)
Figure 5
U.S. Share of World Grain and Oilseed! Production
Percent
28.0
Five-year moving overage. Source: USDA & Commodity Year Book.
Shouldn't our policies be
such as to help move our
share of world production
backup?
1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
95
What has this policy short-sightedness bought for the
U.S.? Prices clearly have not responded. Figures6, 7and
8 show that despite long term declines in com, wheat and
soyhean plantings, prices have also declined. The rest of
the world has planted the acres that we have set-aside at
prevailing prices. This has led us to conclude that the U.S.
is exporting acres rather than products. In fact, though,
the terminology of "exporting acres" is a misnomer. That
is because, with export trade, you should rightftjlly expect
to be compensated. There has been no compensation to
U.S. agriculture or the U.S. farmer for idling acres while
the rest of the world takes up the slack. No, this unilateral
idling of acres can only fairly be termed a "gifl" from the
U.S. to the rest of the world — a new form of foreign aid.
Figure 6
Soybeans: Season Average Farm Price
and Planted Area
dolan/tejn«
Pile*
4.(XIMh — |_LpL| — I I I ^J I I I I M |50
1980 1982 1984 1986 1988 1990 1992 1994
Figure 7
Wheat: Season Average Farnn Price
and Planted Area
1980 1982 1984 1986 1988 1990 1992 1994
Figure 8
Corn: Season Average Farnn Price
and Planted Area
dolan^txanei
inMon ocfss
1980 1982 1984 1986 1988 1990 1992 1994
Despite the U.S.'s good intentions to make [policies
that are beneficial for fanners and for U.S. agriculture,
we have donejust the opposite. Acreage idling hurts farm
profitability in two ways: 1 ) it raises the average cost of
production (fixed costs spread over fewer acres); and 2)
it reduces the output that fanners have available to sell at
prevailing market prices. And with the increasing open-
ness of global markets, prices are not responding to U.S.
efforts to support them with traditional supply control
mechanisms.
Because history teaches that we have little if any
ability to influence the direction of price, if we seriously
want to improve farm profita5ility, we have to begin
focusing on those variables over which we have some
control: pmdnctinn vnliime and production cost (eco-
nomic efficiency).
The Real Cost of Government
Farm Programs
As we begin thinking about the debate on the 1 995
farm bill, many in the fanning commimity are deeply
concerned about budget exposure. As government at-
tempts to downsize and balance far-ranging expenditures
with limited resources, farm programs are prime targets
for cuts, possibly deep ones. This coming fiscal year,
commodity program outlays are expected to be about
$12 billion plus another $2 billion for continuing the
Conservation Reserve Program.
96
Even though these costs aie significant, they pale in
comparison with the total cnst.s to the ecnnnmy of prn-
gram.s that force acreage iriling and other misguided
production constraint"; onto a highly productive U.S.
agriculture.
Acreage idling progTamsare.shrinkingniral America.
A recent study reported by the Minne.sota Agricnlmral
F.conomist reports that acreage idling programs have
substantially eroded rural communities where farming
typically contributes an average of 20 percent or more to
total income. It estimates that between 1950 and 1990
acreage idling has forced an exodus of farm population of
1,1 SO per decade fnreach county. This means an average
of 4,600 people from each county were forced to seek
employment elsewhere by acreage retirement, and this
loss was over and above the natural employment reduc-
tions associated with more efficient machinery and the
substitution of capital for labor in production agriculture.
The report concludes that the loss in farrp output caused
a loss in the demand for goods and services provided by
rural nonfarm people. The loss in population caused
substantial decline in the overall rural economy, and
instiniticns serving those communities, including schools,
hospitals and churches. Thus, acreageidling is credited
vyithcontrihuting significantly to the long-term decline in
srandani of living and quality of rural life.
A recent study by Abel, Daft and Earley, funded by
the National Grain and Feed Foundation, estimates that by
gradually expanding our use of planted acreage that is not
environmentally sensitive, the U.S. could, by the year
2002, achieve the following economic gains:
■$29 billion annual increase in the tiational economy;
■ $4 billion annual increase in net farm income; and
■ create 225,000 new jobs, many m niral areas.
While the potential to add to net farm income avail-
able from the market and add a large number of jobs to
rural economies is real, if the U.S. fails to affirmatively
put its productive acreage back to work, production
constraints become an imnecessary burden or cost to the
economy of $29 billion. It is money that the U.S. wiil
"leave on the table" by not responding rationally to market
opportunities in a more open global ecoilomy. Compare
the size of this indirect "cost" with the direct programcost
of $12 billion.
While there is mounting concern about the govern-
ment costs of farm programs, the most significant costs to
the economy are not the direct cost to government, but the
indirect cosLs created by the economic constraints im-
posed hy government. These indirect costs are created by
the structure of these programs that force producers to
make irrational economic choices. Some groups worry
that the U.S. should not "lonilaterally disarm" in the face
of "unfair" global competition. As we see it, the U.S. has
already "unilaterally disarmed" by failing to more fijlly
use its most effective economic "weapon" — the highly
productive soils of the U.S. prime grain and oilseed
production areas.
As farmers are being asked to farm in more environ-
mentally sensitive ways, and pursue risk management
through m<iiket-based mechanisms, there may be confin-
uedjustification for government transfer payments. But
the most onerous aspects of farm programs — those that
force producers to reduce their productivity (and, thus,
revenue potential from the marketplace) and those that
force producers to be less cost-efficient to qualify for
government income support programs — should be re-
jected.
1990s Definition:
A Market-Oriented Agriculture is a
Production-Oriented Agriculture
We believe there are many reasons to be highly
optimistic about the prospects for U.S. agriculture:
■ The NAFTA agreement should ensure strong de-
mand uoKi Mtxicci;
■ The GATT agreement, if ratified, will open up
additional global opportimities;
■ Pacific rim countries' demand for grain, protein and
meat products looks strong;
■ World economic recovery should create a sponger
demand base worldwide;
a Trends in domestic consumption for grain indicate
th^ strong growth, pirticuiarly from the m.eat sector in
the last 8-9 years, is likely to continue.
In short, world markets for grains, oilseeds and
related \aiue-added products are e.\pected to continue a
steady upward trend for the foreseeable ftiture. In the
study conducted by Abel, Daft ino Earley forthe National
Grain and Feed Foundation, projected demand for U.S.
grains in tlie year 2002 is expected to be 17.1 billion
bushels. These projectionscompareclosely with USDA's
own analysis of demand potential after GATT. This
97
projected demand is based upon a continuation of the
current trends in domestic grain utilization plus only a
modest recovery in the export ofbulk commodities. (See
Figure 9.) In fact the study suggests that the U.S. is
highly unlikely to ever recover its one-time preeminent
position in dominating global bulk grain export markets,
eyen if the U.S. makes a strong commitment to put more
acres into production.
Figure 9
ARPs, CRP and 0/85 programs,
never become visible. Othercountries will simply expand
to fill the void, just as they have for the last decade. That
is, in a competitive world, no one is going to come to the
U.S. and "grant" us this increase in market share. Other
countries will just steadily capture this growth through
plantings. But the U.S. can strategically position itself to
capture a portion of the growing world demand for food
by steadily increasingils acreage in production overtime.
Aggregate Pemand Growth Potential forU.S. Groins/Oilseeds
MAS «m WVJ TJm
tMv w/xoo xomoi ZDiAn wowm
TiiC Abel, Daft and Ea'' ;;' :^idy presents
strong evidence that this can be done in a way
that uses only those acres that are both pro-
ductive and non-environmentally sensitive.
The study estimates that of the more Lhan 50
million acres now idled, there are some 1 7
million acres now being idled that should be
considered for longer-term conserving uses.
We submit that this strategy of commit:
ting in increa.sed prndiictinn should be the
paramount concern in the 1 995 farm legisla-
tion. In the highly competitive global economy
of the 1 990s, amaiket-oriented agriculture is
a production-oriented agriculture.
Importantly, though, to meet this demand level in the
year 2002 will require
Today, with normal yields, we would ex-
pect to harvest about 14 billion bushels,
about the same as current demand, with
1 0.6 billion bushels going to domestic us-
ers and 3.4 billion moving into export
channels. Aggregate crop yield growth
(assuming no major technological break-
throughs) on current acreage in cultivation
will result in a production growth to only
15 billion bushels by 2002. To meet the
extra demand and reach the 17.1 billion
bushels, will require the planting of 35 to
40 million additional acres. (See Figure
10)
How does the U.S. meet this challenge
of its "acreage gap?" If we do nothing but
maintain status quo, continuing annual
Figure 10
Aggregate Supply/Demand Balance
-- Tl]e Acreage Gap —
9W99 99/3000 KDO/XJD} 3001/3009 JODS/aOOS
6
98
What Congress Can Do to Enhance
Farm Income?
Given the high level of productivity in 1 994, the low
cost of production and the fairly aggressive expansion in
demand base, it appears that midwestem farmers will do
fairly well. Congress shouldavoid the costly mistakes of
the past, such as the unilateral raising of loan rates, or
establishing reserve programs that unduly restrict the
access to grain by the marketplace. Such short-term
"fixes" have proven highly counterproductive in the past
As a case study, we attach to this testimony two brief
papers we authored in 1993. These documents testify
why such "solutions" do not work and how the raising of
loan rates in the early 1 980s reduced our export markets
for whole grains by almost 50 percent over a period of
four years. And even though we now have "marketing
loans," high loan rates create added budget exposure
which ultimately has to be controlled by higher acreage
idling.
For the longer term improvement of farm income
potential, we would urge Congress to adopt program
changes that give farmers the fiEedom and flexibility to
earn expanded income from the marketplace. If we lock
up land in acreage idling programs, we are not even
giving U.S. markets a chance to growand we are failing
to give the U.S. farmer the opportunity to compete mor«
aggressively and improve his own standard of living.
Looking forward to the 1 995 farm legislation, a few
questions about current policy seem appropriate:
!• Why should we have pnlicie.s that rp<;frict the rpvpniiR
that farmeni can earn from the m.irWptp|3rp9 The
1995 com ARP announcement of 7.5% is a perfect
example. With fairly tight carryover stocks and
demand beginning to grow, now is an excellent time
to be sure that production is adequate to feed a
growing demand. Yet, USDA just announced a 7.5%
ARP for com, presumably to restrict budgetary
exposure. Yet, this policy is known to restrict market
growth and reduce net farm income. With govern-
ment budget cuts likely, shouldn't we develop strate-
gies to allow market based income to grow?
We have similar concerns about the fiiture of the
Conservation Reserve Program. Even though supply
and demand projections contained in its Uruguay
Round analysis indicate the need for more acres, the
administration recently provided assurances about
extending the CRP in the 1 995 farm bill. If extended
in its current form, the CRP will isolate productive
acres from the global marketplace and will result in
lost markets and lost income for U.S. farmers and the
rest of agriculture. Any extension of CRP needs to be
carefully targeted at truly environmentally sensitive
acreage.
2. Whvshoiliri the U.S. cnntiniiepniirip-! that impfHpthff
economic effiriencv of fannprs and i^isp avpragp
costs of pmdurtion'' In a highly competitive world,
every industry from computers to autos to agriculture
has to take every action possible to lower costs and
produce efficiently. Market share and economic
growth will come to those that are most efficienL
3. If U.S. SUflplv manat-ement pfTnrf; can no Inngfr
control maricptpricps <;hniilHn'twpfnrii<;ourpoliHpi
atthQ.se nrofit-relatedvariahlp«! over whirh we dnhavp
controL ie. production volume and production cost?
•*• If the U.S. PQVemment i.s going tn rontinne fiinding
farm t^rOPrams whv shnnlHn't these prngrams hp rp-
Shaned tn enrniirage hrnaH-hased growth in agrinil-
ture and create more inhs. rathpr than hp an ->mp^f\].
ment tn Prnwth in the naHnnal pconnmy'' Thprp an- 7 \
million people employed in agriculture, food,
agribusiness and related industries. Pro-growth poli-
cies, focused on greater output, could contribute sig-
nificantly to growth in both gross domestic product
(GDP) and national employment
5. And, whv should the ITS, continue tn .support pnlirif f;
that lead tn substantial dprlinps in the qnaliry nf lifr
andstandarrioflivingforthnseinniralcntnmimirip.^?
Thank you for the opportunity to testify. I would be
happy to respond to questions.
99
^^A^HicuLrt;;,^ U.S. AGRICULTURE 20/20
20/20
Volume 1. Number 2. April 30, 1993
Loan Rates and ARPS -- Flip Sides of the Same Policy?
(This is the second in a series of briefings prepared by the National Grain and Feed Association on policies
important to economic growth and prosperity for U.S. agriculture. New editions will arrive every two to three days
during budget reconciliation.)
Nom^couise loan rates and acreage reduction
programs - two mainstays of U.S. farm policy
since the early 1930s. Their intent has been to
help farmers. But too often, they've done just
the opposite.
■ Loan rates are intended to give farmers credit.
But they can unilaterallv set a govemment-mmimum
EliES. If they 're out of whaclc with market pnces. U.S.
grain is stored, not shipped. Where do our foreign
customers go? Where the price is right - overseas to
foreign farmers eager to undercut our prices and take
our markets!
That's e:5actly what happened in the early 1980s.
High loan rates caused export demand for both U.S.
wheat and feed grains to plummet a whopping 42
ESrcsiUinjust four years! The net result? The United
Slates forfeited 5.3 billion bushelsofcomsales and 2.5
billion bushels of wheat
■ Acreage idling unilaterallv restricts <aipplies.
U.S. grain needed by the domestic and export market
is never growa The effen is the same - customers
head to foreign shores to buy grain from farmers only
too eager to clear land and grow what U.S. farmers
WHEAT
CORN
High Loan
Rales
Feed Grain Expofia
1.3 bll. bu.
(49%|)
Idled Acreage
Restricted
Supplies
DECUNEIN:
Feed Grain Ejtpons
720 mil. bu.
(26%l)
74 7S 7a 77 76
7S 78 eo ei S3 so
ftS M a7 M M dO
li-( ,. ■_M)i)ii,".-:;«ii:. fjo^) JsM.ns7:i K.i\: cJO'.'i 'JS'i-.'
100
aren't allowed to by government policies. The
United States now idles about 60 million acres --
much of it prime farmland -- through ARPs, CRP
and 0/92. We're tlie only country in the world that
idles significant acreage.
What happens when we idle productive farm-
land? We forfeit sales! After the 1985 farm act, large
government stocks (forfeited during the period nf
high loan rates) and a generic certificate program
temporarily ensured that U.S. supplies and prices
would stay competitive. For a couple of years,
markets recovered.
But look what ' s happened since 1 989. once those
government stocks were sold! Wheat exports have
shrunk 17 percent while feed grain exports have
declined 26 percent -- largely because of short sup-
plies caused by acreage idling.
U.S. Acreage idled
(S«t-«ild«. ARP. 0^92. SO/K. CRP)
t... .1 ARP,0«l50/«
■I CRP
1980 19B3
U.S. Grain Production Foregone
by Acreage Reduction Programs
Mrr
uo
MO
310
»0
ISO
100
SO
^- -^
1077,'78 T»eO 8VB2 eiM 8^88 87 88 BftM 8V82 1
s
0 when you look at it, excessive loan rates and acreage idling
really are the flip sides of the same policy. High loan rates
restrict supplies available to the market at competitive
prices. Acreage idling restricts the supplies we have to sell.
T
hat's a lose-lose for America's farmers and agribusinesses!
Next: Is Now the Time to Pull the Rug Out from U.S. Farmers?]
101
^.s.AGwctiLT(;^e U.S. AGRICULTl IRH 20/20
20/20
Volume 1, Number 9. May 27. 1993
The Long Tails off Short-Term Policies
(This is the ninth in a series of briefings prepared by the National Grain and
Feed Association on policies important to economic growth and prosperity for
US. agriculture. New editions will arrive every two to three days during budget
reconciliation.)
uxious thing about short-tenn. stop-gap
policies.
c
^ J They tend to provide temporary relief and
^^^^ can make the intended beneficiaries of
those policies feel good.. .for a while. But inevitably,
they have a way of coming back to sting you.
Take U.S. agricultural policy. The goal has been to
stabilize and support the income of U.S. famiers by
protecting them from the vagaries of a cyclical market-
place. In so doing, there's been a tendency to rely on
short-term, stop-gap solutions to minimize the adverse
effects of market adjustments.
But over the long term, those short-term policies
have boomeranged - worsening the very problems
they were trjing to solve.
Let's look at just a couple of examples:
■ Loan Rates: In the early 1980s, the United
States began increasing loan rates for wheat and feed
grains in an honest effort to support farm pnces.
But the policy backfired. The Soviet grain em-
bargo sent prices on a downward spiral. And by 198 1 .
the higher loan rates and declining prices for wheat
converged to the same level. U.S. wheat began to be
forfeited to the Commodity Credit Corporation by
farmers under the pnce support program. It accumu-
lated in storage, rather than being sold at the lower
market prices. It didn't take long for our foreign
customers to figure out there
were plenty of other places in the world willing and able
to grow and sell grain at prices lowerthan the U.S. loan
rate.
The painful "long tail" of this policy stung U.S.
agriculture. By 1985, U.S. wheat exports reached their
modem-era depths - apaltry 909 million bushels - a49
percent drop in four short years. The same impact of
hi ghloan rates was felt in the commarket- from a high
of 2.4 biUion bushels, com exports sank to 1 .2 billion
bushels in 1985.
Loan Ratss - Impact on U.S. Whaat Exports
1.800
1.700
S 1.600
I '">
'e 1.400'
I 1.300
Q 1 JOO.
I "<"
' 1.000
too-
a
\
I^
/■-v
Prte*
Loot
LOAN .
flATE \
\ .-
.400
.390
■ Acreage Idling: But excessive loan rates aren't
the only short-term policy thai short circuits long-term
growth of healthy markets in agriculture. Excessive
reliance on acreage-idling programs can - and do -
have the same negative effect.
ik \\
102
Take the 1994 wheat program. USDA's analysis
indicates that a 10 percent increase in the level of
acreage reduction programs will cause U.S. farm prices
to increase 6 percent. But the "long tail" of this policy
is an 8 percent decline in net farm income and a 60
million bushel drop in the utilizauon of U.S. wheat in
domestic and export markets.
1994 Wheat - First-Year Impact
Increase in ARP of 10%
U.S. Farm Price + 6 %
Net Farm Income — 8 %
Market Demand Lost — 60 mil. bu.
Unfortunately the gain in price lasts only as long as
it takes for foreign producers to respond. But the
shrinkage in markets is cumulative -- it grows with
time.
During the 1980s, successive acreage reduction
programs caused us to lose 1/4 to 1/3 of our export
market volume! And at the end of that decade, U.S.
farm prices still were no higher relative to the rest of
the world than they were in the first year.
In attempting to manage stocks, acreage-idling
policies risk the "long tail" of forfeiting sales to domes-
tic and foreign customers. Dr. Robert Paarlberg, a
professor at Harvard, puts it this way: "The principal
reason for she shrinkage in U.S. marker share is our
bad habit of embracing unilateral production
controls....Cutting production to boost commodity prices
has also, over the long term, not been helpful to our
farmers. Price gains are temporary; they evaporate as
soon as foreign producers respond."
When we idle productive farmland, we forfeit
sales. And we lose the economic activity that grain
production generates in rural communities and through-
out all sectors of agriculture. After all, grain that is
never grown is never planted, never fertilized, never
sold, nevertransported, neverprocessed, never fed and
never exported.
Ouch!
Conclusion
Gary Reidel, chairman of American Soybean As-
sociation, said in the January 1993 edition of Farm
Futures: "We've been governed in the time I've been
farming by a system in which the government guaran-
tees us a certain amount per bushel if we will confine
our production to some specific acreage. That's not
the way to encourage the growth of our market
share. ..We need to talk about how to use the resources
we have to capture a bigger portion of the market. We
have to find an alternative to increasing the setaside
every time we have a big corn crop, because that
strategy is simply not productive."
Maybe this producer-leader has a point.
Maybe it's time to take alonger-term perspective;
to adopt policies that, over time, offer the best real
prospect for helping all sectors of U.S. agriculture
grow and become more profitable. And maybe it's
time to stick with them and give them achance to work.
After all, if the short-term, stop-gap policies we've
been using worked so well, why are we still discussing
the need to promote rural development and improve
farm income?
Next: Building a Prosperous U.S. Agriculture Requires Teamwork I
103
STATEMENT BY KIM LARSON
IMMEDIATE PAST PRESIDENT, MINNESOTA SOYBEAN GROWERS ASSOCIATION
BOARD OF DIRECTORS, AMERICAN SOYBEAN ASSOCIATION
before the
SUBCOMMITTEE ON GENERAL FARM COMMODITIES
COMMITTEE ON AGRICULTURE
U.S. HOUSE OF REPRESENTATIVES
October 6, 1994
Good morning, Mr. Chairman and Members of the Subcommittee. I am
Kim Larson, a soybean and corn producer from Willmar, Minnesota.
My county, Kandiyohi, is in the northern tier of counties in the
Second Congressional District which, as Representative Minge knows,
is regularly the largest soybean-producing district in the U.S. I
am appearing before you today on behalf of the Minnesota Soybean
Growers Association and the American Soybean Association.
I would like to commend you, Mr. Chairman, for holding this hearing
as the impact of this year's large corn and record soybean harvests
are reflected in the market. The soybean price at the elevator in
Murdock, the nearest location buying beans in my area this week, is
$4.88 per bushel. This is a reduction of $1.57 cents per bushel
from the price in June. With our county loan rate at $4.76, any
further pressure could trigger loan deficiency payments.
The situation for corn is similar. Corn prices in our area have
fallen from $2.48 in June to $1.78 this week. With our loan rate
of $1.80, payments could be significant on this year's corn crop.
Our yields will be substantially higher than last year, when we
lost a major part of our soybean and corn crops to flooding. We
expect soybeans to yield an average of 39 bushels per acre compared
to just 22 bushels last year and an average of 33.3 bushels over
the previous five-year period. Similarly, corn yields are placed
at 140 bushels per acre, twice the 70 bushel yield in 1993, and
significantly higher than the 110.6 bushel five-year average.
These yields reflect the severe losses caused by last year's
floods. Minnesota's soybean crop this year is forecast at
218,400,000 bushels, nearly double 1993 output of 110,000,000
bushels. Our corn production is forecast at 882 million bushels,
over two and one-half times the 1993 crop of 322 million bushels.
With losses so substantial, the disaster assistance provided by
Congress last year was essential in keeping many farm operations
viable. Disaster payments on soybean losses in Minnesota totalled
$106.2 million. For corn, the total was $287.9 million. Of these
amounts, over one-third of the soybean payments and nearly three-
fourths of the corn payments were attributed to losses in the
Second Congressional District.
104
-2-
Every farmer knows that it is better to have a big crop at a lower
price than no crop at a high price. Still, it is extremely
difficult for us to manage complex farming operations, including
planning large capital investments, when we have such sharp peaks
and deep valleys in our year-to-year cash flow.
I would like to comment on how the crop insurance reform plan that
passed the House earlier this week and may be acted on by the
Senate before adjournment, could affect producers in my area.
Minnesota soybean and corn farmers have generally bought crop
insurance to stabilize year-to-year income variations. The level
of coverage purchased has reflected expectations that, in the event
of severe crop failure, the Federal government will continue to
provide ad hoc disaster assistance to offset catastrophic losses.
Under the new crop insurance program, producers have been assured
by the Federal Crop Insurance Corporation that premiums on higher
levels of coverage will be reduced. For soybean producers, this is
an essential element in the success of the reform package. The
catastrophic coverage only provides assistance when losses hit the
50 percent threshold. As a result, producers will need to purchase
additional coverage for less severe but still critical losses.
Our understanding from FCIC is that premiums for the 65 percent
coverage level should be about 17 percent less expensive than the
current program, and that 7 5 percent coverage should be 8 percent
cheaper. Mr. Chairman, it is vitally important that FCIC acheive
these cost reductions, or crop insurance will not be an affordable
risk management tool for many farmers.
I would also mention an idea under consideration by a coalition of
groups in the oilseed industry to supplement the new crop insurance
program with an option for farmers to place part of their annual
income in a tax-deferred account similar to an IRA. Access to this
fund would be restricted unless a producer's farm income fell below
a percentage of average income in previous years. This plan
recognizes the extreme variability of farm production and income,
and would offer farmers an option for managing cash flow risk.
In addition, Mr. Chairman, the American Soybean Association and
other oilseed organizations are preparing recommendations for
consideration by Congress during debate on the 1995 Farm Bill. We
hope to present realistic proposals on planting flexibility which
reflect the interests of farmers who can grow several crops while
protecting the interests of those who cannot. Finding ways to
encourage growers to introduce greater flexibility in their
cropping patterns is another way to deal with income variation.
Mr. Chairman, I appreciate the opportunity to appear before you
today, and again thank you for holding this important hearing. I
will be happy to respond to any questions you may have.
105
(NFIJ-Oci 6. 1994-pii^cci)
Testimony of
Larry Mitchell, Vice President of Government Relations, National Farmers Union
Economic Outlook for Corn and Soybean Farmers
Subcommittee on General Farm Commodities, Committee on Agriculture
U.S. House of Representatives
October 6, 1994
Thank you, Mr. Chairman and members of this committee. I am Larr>' Mitchell, vice
president of government relations for the National Farmers Union (NFU). I bring greetings
to you, Chairman Sarpalius. from our national president, Leland Swenson, as well as from
Joe Rankin, president of the Texas Farmers Uruon. We appreciate that you are holding this
hearing to listen to our assessment of the situation facing com and soybean farmers..
Overview
Just one short year ago, many of this nation's farmers were plagued with tloods and the
destruction left in the aftermath. Today those same farmers are plagued with a flood of corn
brought on by excellent weather and a zero Acreage Reduction Program (ARP).
■America's family farmers have experienced an exceptional growing season, and the prospects
for record or near-record harvests of com and soybeans are mounting daily. But producers'
enthusiasm over a wonderful har\ est is being dampened by devastating!) low commodi<>
prices. Yesterday morning, farmers in Mitchell. S.D., av.oke to cash prices of $1.77 pe-
bushel, for com and $4.73 per bushel, for soybeans. Farmers in central Minnesota had cash
prices yesterday morning at $1.78 per bu.shei. for com and $4.86 per bushel for soybeans.
Possible Remedies
Many of my friends here at this table today joined together recently to address the problems
of low prices for this year's crop. Two weeks ago, NFU, the National Farmers Organization.
the National Family Farm Coalition, the American Agriculture Movement, the Federation
of Southern Cooperatives, the American Com Growers Association, the Texas Corn
Producers Association and the National .Association of ^armer Elected Committeemen stood
together and called for the following steps to be taken by both farmers and the federal
government to mitigate the price crisis:
• That farmers should store newly-harvested commodities to the fullest
extent possible so as lo avail themselves of marketing opportunities;
• That famiers enrolled in federsl farm programs make the fiillest use of the
Comm.odity Credit Corporation (CCC) loan programs, thus keeping
product off the market d'onng tne typical seasonal price depression and
106
(NFU-Oci 6, 1994 -page #2)
allowing for more orderly marketing of the large harvest when more
positive market signals dictate;
• That the secretary of agriculture, with the cooperation and encouragemeiit
of Congress and other agencies of the federal government, increase
commodity loan rates to at least 1 00 percent of the five-year average
price in order to at least make the loan program a more attractive option.
It is our sincere belief that such action will also improve market prices as
for more than sixty years, evidence (see attachment #1) indicates an
almost lock-step correlation between loan rate levels and market price
levels for commodities;
• That the secretary of agriculture make optimal use of his discretionary
authority to announce well in advance, preferably as soon as possible, the
opening of the Farmer Owned Reserve (FOR) for the 1994 crop under
loan upon the expiration of the regular nine-month loan, allowing farmer
additional marketing flexibility;
• That farm lenders display as much flexibility and discretion as possible
in the coming months to allow producers to extend the marketing period
in order to improve their incomes, cash-flow and credit-worthiness;
• Lastly, that the federal government investigate the growing level of
concentrated contract production in livestock which has been encouraged
by low grain prices. This has been a major factor in the present downturn
in livestock prices.
I hope I covered the requested subjects of today's hearing. I am prepared to answer an>
questions to the best of my ability. National Farmers Union stands ready to help this
committee in addressing of the steps outlined today as well as drafting a 1995 farm bill
which protects the consumers, the environment, the taxpayers and the family farmers of this
nation. We commend this committee for its foresight in having this hearing today.
Thank you.
107
Attachment #1
in
CM
O
O
o
in
in
CM
108
Prepared Statement of David Sentar, American Corn Growers Association
! am David Senter and I am here today representing the American Corn Growers
Association (Corn Growers). The Corn Growers appreciate the opportunity to testify
before the Subcommittee on General Farm Commodities on low corn pnces and the
impact of the sever flooding on producers.
It is a wfc'! known fact the adverse impacts the flooding of 1993 and 1994 have had on
corn farmers. The flooding occurred after farmers had much, if not ail, of their
expenses in the crop. The only expense 'eft was the harvesting and transportation
costs. This expense resulted in huge looses for farmers caught in the flood areas.
Producers outside the directly effected flood area had above a^e-'age rain fail and
reduced yields and :^wer quai'ty. This year, flooding in the southeastern states hur*
corn producers as hard as the midwe.st did in 1993.
Estimated cost to farmers exceed $425 million for corn and soybean farmers. These
farmers have spend the winter and spring repairing eroded land, cleaning up trash
and fixing broken ievees and drainage ditches.
Farmers have had to pay the vast majority of these costs themselves. Some lana
clean up cost.s exceeded $3 200 per acre. Some of the levees still aren't fixed today.
The government spent a lot of money on the disaster, but much was left for the farmers
;o pay.
This year, producers are facing a second disaster, this time lower phces. It is clear that
supply and demand no longer dictates the price of corn. In a year when this country
iias had the lowest corn carryover stocks on record, July futures contracts was trading
in the $2.30 - $2.40 range. This resulted in a farm price of $2.20 to $2.30 per bushel.
Twenty years ago was the last time stocks were as tight as this year, the average p. ice
for that year was $3.02 pei bushel.
If you add inflation since 1974, you can see where corn prices are. Today, in constant
dollars, corn is about 25% of the value it wa? tnen. it is clear now tt.at the market is set
by looking at the projection of r.f^y^ years crop, not what's in the bin.
There is no meanlnnful way other than the CCC comniodiW loan rates tc stabilize
prices for producers. The Corn Growers have urged the Secretary of Agriculture to
immediately raise loan rates to $2.40 per bushe! for corn.
The loan rate of $2.40 is 25 cents less than the cc.n loan ra-e was in 1982. It w ouid
mean producers could get the additional incorrie from the crop which will help avoid
further loses tc these farmers.
Wte also urged Secretdry Espy to announce the Farmers Owned Reserve will be
opened tc allow producers to use the existing farm programs lo stop the drop in corn
prices and market in an orderly manner.
We applaud the Secretary's 7 1/2% Acreage Reducticn program for corn recently
snnounced. This is a st?p in the nght direction frc.Ti the 0% set aside ^o^ the 1994 crop
which was a mistake. Now producers are paying the price, the Corn Growers urged
109
ACGA, Page 3
the maximum set aside of 12 1/2%, fcr the 1995 crop year. Any decision that lowers
prices ends up costing the taxpayers with larger program costs.
The Corn Growers support farm programs that are used to stabilize prices, not lower
prices.
In 1985, this committee and the aaministration said we would see higher prices if we
implemented a market oriented, competitive farm bill. We did and prices are lower
now than then. Production prices are up and farm numbers down. It appears the
result was to lower the price of corn for the exporters and processors.
With on average 4 out of 5 bushels used domestically, explain to me why we lowered
the price on every bushel, to sell 20% to the export market. A fair price is right and the
next farm bill will be judged on it.
Thank you for the opportunity to appear before this committee. We look forward to
working with you to enact a 1995 farm bill that will raise farm income.
86-967 (120)
BOSTON PUBLIC LIBRARY
3 9999 05018 529 5
ISBN 0-16-046691-1
780160
466915
90000
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