1. History of O&C Lands

Polk’s War with Mexico• Not only acquired Texas, but California aswell• After Polk’s term ended in 1849, a rich golddeposit was discovered, and the rush was on• Growing populations on the Pacific coastcreated need for faster transportationconnection

• During the 1850’s, a national debate took place onwhere to build a transcontinental railroad• Four possible routes• Deadlock in Congress over the route because ofnorth-south contentiono• Civil War broke the deadlock

Transportation to West coast in 1850’sClipper ships around theHornOrHorse, mule, or oxendriven wagon over theOregon Trail

President Abraham LincolnProminent railroad attorney at thetime he was running forPresidentHis platform included thefollowing:“That a railroad to the PacificOcean is imperativelydemanded by the interests of thewhole country; that the FederalGovernment ought to renderimmediate and efficient aid inits construction.”

President Abraham LincolnOne of the interests served byOne of the interests served bythe railroad connection tothe west was to keepCalifornia, Oregon andterritories in the Union

Building a Railway systemPresident Abraham Lincolnsigned the Pacific RailwayAct in part of the darkestperiods of the Civil War onJuly 1, 1862.This act provided Federalgovernment support for thebuilding of the firsttranscontinental railroad,which was completed onMay 10, 1869.

Land grants subsidize the building ofrailroads and wagon roadsFighting a Civil War, Congress had little money tospare, but did have a lot of public lands1850-1870 Congress passed twenty-four separate actsgranting companies130 million acres of public domain in the trans-Mississippi westAn area the size of Texas

Transcontinental Railroad• Central Pacific Railroad• Union Pacific Railroad• 1863-1869• Alternative sections of public land granted to railroads tosubsidize construction and create customers• New towns, such as Laramie and Cheyenne created

Trip to San Francisco from the east• Before railroad: Over $1000 and months• After railroad: $70-$150 and seven days

1862 Homestead ActAlso in 1862 Congresspassed the HomesteadAct which increasedsettlement in the West,by giving 160 acres offree land dto any personwho had lived on theland and improved it forfive years.

General Land OfficeThe Homestead Act andthe railroad grantsgreatly increasedresponsibilities for theGeneral Land Office

Birth of the O&CLeland Stanford, the Central Pacific Railroad sets up theCalifornia and Oregon Railroad in 1865 to build a routefrom Sacramento to the Oregon borderCongress establishes land grant in July 1866 to completeOregon tie from California border to Portland

1866 O&C Railroad Grant

1866 O&C Railroad Grant

Terms of 1866 Act3.7 million acres12,800 acres/mile of trackPrimary ygrant – 20 miles either side of routeIndemnity lands – additional 10 miles(30 miles total)

Recipient railroad designated by OregonlegislatureOregon Central railroad located in Salem,intended d to build west side of WillametteOregon Central railroad located in Portland,intended to build east side of Willamette

No immediate public demand d for the grant lands, bothcompanies had financial problemsCalled on Congress for further assistanceCongressional committees more concerned withprotecting national interestWartime fervor for internal improvements cooled

Supplementary Act 1870• Any railroad• Lands to be sold only to “actual settlers”• No more than ¼ section, 160 acres• No more than $2.50 acre

Before President Ulysses Grant signed the bill,

Ben Holladay secured control of both OregonCentral railroads and renamed it theOregon and California Railroad

How the O&C Plan WorkedUnited States transferred O&C lands to the Stateof OregonState of Oregon transferred O&C lands to therailroadRailroad transferred O&C lands to settlers andpurchasers

Railroad was not liable for taxes until taking titleto landsRailroad delayed taking title, kept lands withState of fOregon

O&C Railroad Co. builtsouth along the east sideof the WillametteBridged the Clackamas,Molalla, Santiam RiversOver the UmpquaCl Calapooia divide diid

1872 the O&C Railroadreached RoseburgTowns that were born of therailroad:Canby, Tangent, OaklandHarrisburg, Creswell,Drain, Yoncalla,(knocked out the WillametteSteamboat service)

Trouble• Free homesteads• Heavy timber• Steep topography

Villard’s Take Over• 1873 Henry Villardrepresenting Germanstockholders took overthe company• Reorganized, strategy todispose of lands to raisecapital

Because of financialtrouble, constructionstalled and for nineyears the O&CRailroad terminated inRoseburgRoseburg prosperity asKlamath Falls andRogue Valley shippedin and out of Roseburg

1881 Construction resumedalong the South UmpquaRiver, Cow Creek canyon,over the Umpqua Mountainsto the Rogue ValleyTowns that were born of therailroad: Riddle, Glendale,Grants Pass, Medfordd(Jacksonville became almosta ghost town after bypassedby the railroad)

Bankruptcy – Villard loses controlThe O&C acquired (leased) by theSouthern Pacific (1887-1927)

Golden Spike at AshlandDecember 17, 1887This event was important to the entire nation,as it completed the railroad circle around theUnited States

Turn of CenturyConservationPopulismProgressivismPopulists called for federalownership of allrailroads and recoveryof land grants

Edward HarrimanTook over the Union Pacificand other linesControlled the SouthernPacific, hence the O&CRailroadMade many of the decisionsthat led to battle with theState of Oregon and Federalgovernment over the O&CRailroad

1890’s, Southern Pacific sold hundreds ofthousands of acres at prices up to $40 acreOne sale to a single purchaser was 45,000 acresat $7 an acreSpeculators employed dummy entrymen to frontas “actual al settlers”

President Grover ClevelandJust before leaving officein 1897, createdNational Forests byEectieOrderExecutive

President Teddy RooseveltExecutive Order expandedNational Forests,created NationalMonuments andWildlife RefugesShifted forest policy fromInterior to Agricultureunder Gifford Pinchot

1902 Southern Pacific under Edward Harriman sold400,000 acres to speculators and lumbermen.Anticipating rising values, Harriman halted all salesAll three stipulations of O&C Act had been violatedOregonians finally reacted at the announcement thathalt of land sales was permanent

Increased evidence offraud, malfeasanceOregonian articles1902 Roosevelt appointedSpecial Prosecutor toinvestigate

1904-1908Oregon land fraud trialsCongressmen, officials of General Land Office wereindicted, convictions1904 Oregonian discovered and reported the “actualsettlers” clause1907 Oregon legislature petitioned Congress to compelrailroad to meet terms of O&C ActGovernor Chamberlain confronts Harriman at a fair

1908 Looters of the Public Domain published1908 Justice Department brings suit againstSouthern Oregon Company (successor to CoosBay Wagon Road Company)

1908 Senate resolution directed the attorneygeneral to bring lawsuitFederal court deliberated for five yearsJudge Wolverton of federal district court inPortland ruled (July 1913)Judgment puzzled everyone and satisfied no one(lands not sold forfeit)Appealed to the Supreme Court

June 1915 Supreme Court RulingUnsold grant land (both patented and unpatented)2.3 million acres50 billion board feetCould be disposed of by Congress within reasonable timeIf Congress did not act in six months, district court could dispose ofunsold lands and timber

1916 Chamberlain-Ferris ActSigned by WoodrowWilson, revest 2.8million acres

Sell land and timber as fast as possible1. Pay the railroad2. Pay treasury for taxes during litigation3. 25% state, 25% counties, 10% U.S.40% Reclamation FundSouthern Pacific brought suit as to constitutionality. Supreme Courtruled for the governmentSouthern Pacific sued for financial i loss and won $4 million

1919 Coos Bay Wagon RoadRevestmentSigned by WoodrowWilson,Revested 93,063 acres

Timber sales– Public Auction –terms: cashGLO employees would ask timber companieswhat they were willing to pay1916-1937 One instance of competitive bid atpRoseburg Office. (resulted in brawl, reducedGLO office to shambles)

President Calvin Coolidge1926-1927 “CoolidgeProsperity”, nationwideboomLogging and timber receiptsbest yet, but still lowactivity i compared toprivateAssociation of O&C Countiespressed for a fix

1926 Stanfield ActSigned by Calvin Coolidge July 1926 after the presidentnegotiated certain termsRelieve economic distress of counties because of lack of revenuefrom the O&C landsGrant $7 million to counties1928 Supreme Court rejected Oregon’s suit to share in Stanfieldpayments1916 formula for payments remained in place

Association of O&C CountiesEstablished in 1926Promoted passage of Stanfield billAOCC 78 year history of workingwith the federal government onthe management of the O&Clands.Guy Cordon of Douglas Countyy g yfounded AOCC

President Herbert HooverProsperity prompts Hoover’sdesire to withdraw federalgovernment from forestryenterpriseSecretary of Interior Wilburfavors:• Move O&C to Agriculture,• Consolidate all forestryunder one agency,• States to take overadministration of surfacerights to public domain

Sustained YieldDavid Mason, consulting foresterfrom Portland campaigned forsustained yield forestry as earlyas 1926Best interests of forestry andlumberingSystem of controlling rate of cut inorder to perpetuate supplyEnvisioned cooperation amonglumbermen as well as federaland statet

1916 -1937O&C InterestsCourtsRailroadCountiesTimberland Congress General PublicOwnersConservationistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

President Franklin RooseveltAdministration addressedthe Depression andWorld War IINew Deal, WPA, TVA,NRA, CCC, REAdesigned to reviveAmerica

Harold Ickes, Secretary ofInterior 1933 to 1945,saw the O&C as anopportunity for Interiorto showcase modern,efficient i and scientificforestry

Secretary of AgricultureSecretary of AgricultureHenry Wallace 1933 to1940 wanted to movethe O&C to the ForestService

Rufus Poole, Interior attorney andDavid Mason drafted HR 5858 in1936House and Senate committee hearingsregarding sustained yield forestrySecretary Wallace attempted tosubstitute “Agriculture” at everypoint bill gave authority to InteriorRe-election of Franklin Roosevelt

The O&C Act, August 28, 1937Title teISustained yield, permanent forest production andtimber supply, determine and declare annualproductive capacity, grazing, recreational facilities,protect watersheds, regulate stream flows, powersitesTitle IIAdministrative costs, payments, distribution ofreceipts

Walter HorningChief forester and first directorof the O&CProfessor of forestry fromIowa State, helpedformulate forest policy forthe National Park Service,analyzed dSecretary Ickes’Olympic National ParkproposalStarted with a budget of$150,000

Recruited small staffDecision not to createprocedural lhandbooksimilar to the ForestServiceOpened district offices inMedford, Roseburg,Eugene in 1938, Salem1943, Marshfield (CoosBay) 1944

Allocation of Revenues50% payable to 18 O&C counties25% proceeds reimburse US treasury forpayments made to counties for lost tax revenueand repayment of fSouthern Pacific25% proceeds to administer O&C Act

After treasury was reimbursed the 25% was to beapplied to 18 O&C Counties75% Counties25% US Treasury

1953 Plowback FundCounties dedicated 25% to federal government asCounties dedicated 25% to federal government asan investment in the management of O&C lands

Plowback to the BLM allowed funding of:• Reforestation and elimination of backlog acres• Funding of nurseries for seed, seedlings• Seed orchards• Intensive practices of thinning, fertilization, treeimprovement• Intensive inventory

Allowable Cut EffectIntensive practices allow more timber to begrown (productive capacity) per year thereforemore timber can be harvested per year on asustained yield basis.Standing harvestable volume allows animmediate short term return on investment inintensive practices. (ACE)

Success at Sustained Yield ForestryDecadal inventories in 1970, 1980 and 1990showed that there was more standing volumeon the O&C Lands than the previous decade.Af 50 f h di lAfter 50 years of harvest, standing volume onthe O&C Lands has increased.

Plowback funded:• access roads• bid bridges• district offices• fire protection• recreation sites1982 W t O BLM i d di t i ti1982 Western Oregon BLM received direct appropriationsfrom Congress, no longer funded through Plowback

Reciprocal Rights of WayLeonard Netzorg, anattorney for BLM,wrote the rights of wayregulations and forms ofagreements thatstipulated reciprocalaccess to federal andprivate timberland, thusbreaking Big Lumber’schokehold on the familyowned mills

President Richard Nixon1969 National EnvironmentalPolicy Act1969 Council onEnvironmental Qualityestablished1970Clean Air Act ct(extension)1972 Federal Water PollutionControl Act1973 Endangered Species Act

President Jimmy CarterOctober 1976 FederalLand ManagementPolicy Act1977 Planning underwayin western Oregon

President Ronald Reagan1979-1983 WesternOregon plans completed1982 - BLM’s Policy1982 BLM s PolicyStatement on ManagingO&C lands

BLM Policy Statement forManagement of O&C LandsMay 1982 Director of the BLM Burford requests through theSecretary of Interior an opinion from Office of Solicitorregarding legal adequacy of policy statement regardingmultiple use management on O&C landsLand Use Planning for 13 Sustained Yield Units and EIS’s werein progressNeeded to respond to public comments questioning interpretationof O&C Act in light of Clean Water Act, Endangered SpeciesAct, Clean Air Act and National Environmental Policy Act

O&C Policy Statement encompassed six objectives:Timber production, water quality, wetlands, T&Especies, habitat diversity, i recreation“Primary objectives of the management program on theO&C lands are to manage for a high-level and sustainedyield output of wood products needed to contribute toeconomic stability of local communities and industries,and to provide for other land uses as established in theO&C Act and other legislation. ”

Solicitor reviewed language of O&C Act, its legislativehistory and subsequent legislationSeptember 1982 Solicitor’s Office 10 page opinion oflegal adequacy of BLM policy statement for multipleuse management of O&C LandsForest production in dominant roleDoes not mandate exclusive use

Bureau must meld dominant use of forest productionwith those aspects of multiple use envisioned by theO&C Act in addition to requirements of subsequentlegislationO&C Act limits Bureau’s management options on O&Clands but provides to a certain degree significantifi discretion how competing objectives are metBLM policy on management of O&C Act struckappropriate balance

Late 1980’s-early 1990’sLitigation regarding spotted owl managementdropped harvest levels significantly

Portland Audubon Society v BLM• On May 18, 1988, the Ninth Circuit Court of Appealsstopped the BLM’s entire timber sales program, notjust the timber sales in spotted owl habitat. The“temporary” injunction nction was later reduced, but kept inplace for the remainder of the year while the Circuitconsidered its opinion. Except for FY 1990, when alegislative rider (Sec. 318) exempted BLM timbersales from the injunction and with a few otherexceptions, the BLM's timber sales were curtailedfrom 1988 until January 5, 1995 — a little over 7years after the case was brought.

Headwaters v. BLMNinth Circuit ruling on O&CWilcox Peak – 1990Plaintiff argued BLM misinterpreted O&C ActPlaintiff argued O&C Act requires BLM tomanage these lands for multiple use includingwildlife conservation rather than for dominantuse of timber production

“We have previously observed that “theprovisions of 43 U.S.C. 1181a make it clearthat the primary use of the [O&C Act] lands isfor timber production to be managed inconformity with sustained yield. ”(9 th Cir. 1990)

Plaintiff argued that the phrase “forestproduction” in section 1181a encompasses notmerely timber production, but alsoconservation values such as preserving habitatfor the northern spotted owl.

9 th Circuit:“inconsistent with the principle of sustained yield”“statute clearly envisions sustained yield harvestingof O&C lands”“There is no indication that Congress intended“forest” to mean anything beyond an aggregation oftimber resources.”

Declarations of Sustained Yield Capacity14001200112711601000874MMBF80060050053566069276940020020301937 1954 1956 1957 1958 1959 1962 1985 1995Year

1986 -2007O&C InterestsCourtsRailroadCountiesTimberland Congress General PublicOwnersConservationistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1986 -2007O&C InterestsCourtsCountiesTimberland Congress General PublicOwnersConservationistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1986 -2007O&C InterestsCourtsFish InterestsCountiesTimberland Congress General PublicOwnersConservationistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1986 -2007O&C InterestsCourtsFish InterestsCountiesTimberland Congress General PublicOwnersConservationistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1986 -2007O&C InterestsCourtsFish InterestsCountiesTimberland Congress General PublicOwnersNon-landowningTimber businessAlternativeLand ManagersFederal ExecutiveBranch

1986 -2007O&C InterestsCourtsFish InterestsCountiesTimberland Congress General PublicOwnersEnvironmentalistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1986 -2007O&C InterestsCourtsFish InterestsCountiesTimberland Congress General PublicOwnersEnvironmentalistsNon-landowningTimber businessAlternativeFederal ExecutiveBranchLand Managers

1989 Hatfield-Adams Amendment (NorthwestCompromise)Environmental groups obtained injunction prohibiting saleof old growth timber on BLM lands near spotted owlsitesRider to 1990 Interior appropriations bill(Section 318)Sufficiency language for timber sales

To stabilize O&C county revenues, appropriationlanguage for 1991, 1992 and 1993 included aprovision for floor payment of 1986 to 1990 annualaverageOmnibus Budget Reconciliation Act of 1993(Safety Net)O&C counties with “Special Payment Amount” basedon annually decreasing percentage of the five yearaverage (1986-1990)1990)1994-2003 $79 million decreasing to $54 million

President Bill Clinton• April 2003 holds ForestConference in Portlandto bring all interests to acommon purpose• Appoints Jack WardThomas to head acommittee of scientiststo come up with a planto get out of the legalgridlock

Northwest Forest Plan• A year later BLM and Forest Service beginmanaging under a common plan, that reducedtimber harvest to only 20% of historic levels,set aside in reserves about 85% of federalforest lands, and applied process-rich, highlyconstricted guidelines for implementingactions.

Northwest Forest Plan• Litigation increased ten-fold, eventuallyresulting in harvest levels at only about 40-70% of the reduced levels, depending on theDistrict.

1994 – Northwest Forest Plan ROD signed by Secretaries of the Departments ofInterior and Agriculture1994 – Lawsuits challenging the NW Forest Plan filed in Western District ofWashington by environmental interest groups and in the District of Columbia bythe Association of O&C Counties, timber industry, and other economic interestgroups and individuals1994 – District ti tof fColumbia court ttransfers case against tForest tService to W.Wash., but refuses to transfer BLM case1994 – Judge Dwyer asserts jurisdiction over BLM case anyway y and joins issues incases against Forest Service, then rules in favor of NW Forest Plan1995 – BLM incorporates NW Forest Plan in new Resource Management Plans1998 – Judge Dwyer rules against government interpretation of the survey &manage provision of the NW Forest Plan1999 – Hanson v USFS – Court rules demographic study information did notrequire supplementation of EISs for NWFP

1999 – In the first of a series of three cases Judge Rothstein rules that theBiological opinions for NWFP projects are arbitrary and capricious2000 to present – Numerous lawsuits challenging the Plan or its implementationresult in rulings finding invalid the treatment of Port Orford cedar in RMPs,changes to S&M species through annual species reviews as part of the 2001 planamendment that fixed problems from Dwyer opinion, agency’s interpretation ofguidelines for doing salvage, clarification of language describing how to complywith the Aquatic Conservation Strategy, t and biological i l opinions i on the effects oftimber sales on the spotted owl.

Northwest Forest Plan• The 2004 evaluations of the BLM RMPs foundthat the economic objectives of the Plans werenot being met, and a plan revision wasjustified.

Secure Rural Schools and Community Self-Determination Act of 2000Average of highest payments 1986-1999 + 50%of consumer price index for rural areasTerminated September 30, 2007

Settlement Agreement• American Forest Resource Council (AFRC)and others filed suit alleging that O&C Actwas violated when the Northwest Forest Planestablished reserves where no timber harvestwas planned on O&C lands.• BLM signed a “settlement agreement” with theAssociation of O&C Counties in 1997, whichthen withdrew from the lawsuit.

Settlement Agreement• American Forest Resource Council (AFRC)and others continued the litigation thatlanguished in the District i t of fColumbia federalcourt system for years.• In 2003, while the case was pending appeal,AFRC and the rest of the plaintiffs agreed to a“settlement agreement” with terms similar tothose previously accepted by the Associationof O&C Counties.

Settlement Agreement• The Association of O&C Counties joined the 2003agreement, which amended and partially supersededtheir previous agreement.• In the 1997 agreement, there was a provision i to tollthe statute of limitations for a set period of time(effectively extending the time for re-filing the suit byabout 4 years.), and a requirement for BLM toconsider an alternative that emphasized sustainedyield timber production in any major revision of theRMPs.• Both of these provisions were superseded in the 2003agreement.

Settlement Agreement• Because of the Association of O&C Countiesagreement, the BLM was expecting tocommence a major plan revision i by 2008anyway.• The 2003 agreement thus was an inexpensiveway to end the AFRC lawsuit, and the possiblethreat of another suit by the Association.

What does the Settlement Agreement Require?• To revise BLM’s western Oregon plans andconsider in each revision at least onealternative which will not create any reserveson O&C lands except as required to avoidjeopardy under the Endangered Species Act.• The revisions are to be completed by the endof 2008.

Purpose and Need– Address the shortfall in the timber that is actuallyharvested from the BLM lands as compared to thecapacity of these lands; and– Follow the laws in accordance with the statutoryrequirements of the O&C Act and other applicablelaws

Purpose and Need – Cont.The BLM will consider the following deciding factors.• Environmental consequences, particularly, l but notlimited to:– the extent t of the contribution ti to the recovery oflisted species– the maintenance or improvement in water quality(including the protections of watersheds and theregulation of stream flow)– the reduction in fire hazard risks– the extent of recreational opportunities

Purpose and Need – Cont.Deciding factors – Cont..• Contribution toward the economic stability ofcommunities, including the economic return tothe O&C counties, through the economicopportunities provided by the management ofthe BLM’s lands in western Oregon• Cost of implementation

Estimated Annual Amounts for 1 st Decade under WOPR AlternativesHarvests, Revenues, andNoPaymentsActionAlt. 1 Alt. 2 Alt. 3Harvest (short log mmbf) 355 537 767 473Adjusted stumpage ($ per mbf) 234 254 280 217Total revenue ($million) 83.9 137.2 215.8 103.3Total O&C county payments($million)42 68.7 108 51.7See Table 134, Draft EIS for Western Oregon Plan Revision, August 2007, p. 537

Questions?