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State Land Board votes to sell Oregon’s oldest state forest


SALEM, Ore. (AP) – Two members of the state land board voted to sell Oregon’s oldest state forest, while a third member, Gov. Kate Brown, insisted it remain in public hands.

Amid Tuesday’s vote on the Elliott State Forest in the Department of State Lands, Brown took to Twitter to rally public support for her position. She said on Oregon’s 158th birthday, it was important to come together to keep the Elliott State Forest in public hands.

Voting for selling were state Treasurer Tobias Read and Secretary of State Dennis Richardson.

The vote did not appear to be a final decision on the fate of the 82,500-acre forest. An official said Brown asked the lands director to present other options for public ownership at the next land board meeting.

Oregon Dept. of State Lands news release:

Governor asks State Lands staff to consider public ownership option

Salem — The State Land Board today voted to continue with the Protocol for selling the Common School Lands within the Elliott State Forest. With Secretary of State Dennis Richardson and State Treasurer Tobias Read voting yes, and Governor Kate Brown voting no, the board approved a motion put forth by Treasurer Read:

– Continue working with Lone Rock Timber Management Company and their tribal partners (Elliott Forest LLC) on developing a purchase and sale agreement for 82,500 acres within the Elliott under the Protocol.

– Amend the Protocol to include: 1) a provision whereby the state may buy back up to $25 million worth of acreage devoted to conservation; 2) incorporate Forest Stewardship Council principles into the agreement; and 3) give rights of first refusal to the five federally recognized tribes in western Oregon on any lands that are put up for sale after the transfer to Elliott Forest LLC.

At the end of the meeting, Governor Brown directed Department of State Lands director Jim Paul to investigate public ownership options for the forest, and report back to the Land Board at a future public meeting.

The State Land Board consists of Governor Kate Brown, Secretary of State Dennis Richardson and State Treasurer Tobias Read.

The Department of State Lands administers diverse natural and fiscal resources. Many of the resources generate revenue for the Common School Fund, such as state-owned rangelands and timberlands, waterway leases, estates for which no will or heirs exist, and unclaimed property.

Twice a year, the agency distributes fund investment earnings to support K-12 public schools. The agency also administers Oregon’s Removal-Fill Law, which requires people removing or filling certain amounts of material in waters of the state to obtain a permit.

Secretary of State Richardson news release:

SALEM, OR — Today, the sale of the Elliott State Forest (The Elliott) was again the hot topic before the State Land Board. The sale was first proposed by Governor Kate Brown and the other members of the previous Land Board, former Secretary of State Jeanne Atkins and former State Treasurer Ted Wheeler. The sale was proposed over a year and a half ago and during that time, the Board worked to ensure the Common School Fund (CSF) received adequate funding to hire more teachers, reduce class sizes, and add back school days.

The Elliott is 82,500 acres of steep and mostly inaccessible timberland placed in trust to generate funding for Oregon public schools. In 1859, when Oregon was granted statehood, the entire state was divided into six-mile-square townships with 36 sections in each township. Two sections of land in every township were granted by the federal government to be held in trust solely for the purpose of supporting public education. In the 1930’s, most of those trust sections were consolidated into what became known as The Elliott. The Elliott is in a land trust dedicated to generating money for the CSF. The CSF provides local funding for Oregon’s 197 school districts. The Trustees of this constitutional land trust for public education makeup the three members of the State Land Board.

In August 2015, in response to low financial returns from The Elliott to the CSF, in August 2015, the members of the previous Land Board decided that it was in the best interest of the CSF to sell The Elliott. Requesting $220.8 million along with other provisions in what is referred to as the “Protocol”, the Board offered to sell The Elliott.

The Land Board’s offer was accepted by the only qualified buyer (a consortium composed of Lone Rock Timber Management Company, the Cow Creek Band of Umpqua Tribe of Indians, and the Confederated Tribes of Coos, Lower Umpqua, and Siuslaw Indians). For the past 18 months, the consortium has spent more than $500,000 to comply with The Elliott sale Protocol, and the State has spent more than $3.5 million. Although I believe it was a mistake to set such a low asking price, when a seller offers something for sale and the offer is accepted, a deal is made. There may be details to work out, but if the offer is advertised and accepted, the seller can’t just back out. In my opinion, that is unethical.

In addition, the State had offered the tribes the chance to regain some of their ancestral homelands for as long as the river flows and the grass grows. Were we to revoke the sale, we would, yet again, be breaking another promise to Native American tribes.

So today, the two new members of the Land Board, State Treasurer Tobias Read and I, were true to our fiduciary duties as Trustees of The Elliott. By voting to complete the deal made by Governor Brown and the previous Land Board, we are maximizing the financial benefits for Oregon’s 197 school districts. We voted to complete the sale of The Elliott for $220.8 million with three amendments:

The Protocol will allow the state to buy back up to $25 million worth of acreage devoted to conservation;
The Protocol will incorporate Forest Stewardship Council principles into the agreement; and
The Protocol will give rights of first refusal to the five federally recognized tribes in western Oregon on any lands that are put up for sale after the transfer to Elliott Forest, LLC.

The agreement to sell The Elliott contains provisions to protect old growth timber, the Spotted Owl, and the Marbled Murrelet. It provides access to the few hundred hunters, anglers, and hikers who visit The Elliott annually and it guarantees well-paying jobs for families living in nearby rural communities. The agreement also requires timber management to include sustainable harvesting with replanting of those sections when new-growth timber is harvested.

If the sale had gone through in 2015 when it was first made, the $220.8 million would have been invested for three years with the CSF. Over those three years, it would have generated approximately $54 million. Instead, since 2013, The Elliott has cost the CSF nearly $3 million more than it has brought in.

In conclusion, as Trustees of the CSF and managers of the Elliott State Forest trust, we have the fiduciary responsibility to maximize revenue for our K-12 schools. Unfortunately, instead of generating funds, the State’s inability to manage the Elliott productively has cost us money. I did not want to sell The Elliott, but my fiduciary duty as a Trustee is to support the CSF and my ethical duty is to complete a bargain struck in 2015 by Governor Brown and the previous Land Board with Lone Rock and the Native American tribes.

Statement from Treasurer Read regarding Land Board Action on Elliott Forest

SALEM – Today at the State Land Board meeting, Treasurer Tobias Read proposed additional conservation enhancements and assurances for tribal land acquisition to the Department of State Land’s Elliott State Forest protocols. The Land Board voted 2-1 to accept these requirements and directed the Department of State Lands (DSL) to move forward with negotiating the terms of a sale of the Elliott State Forest.

Statement from Treasurer Read:

“The decision to affirm the previous State Land Board’s direction and to move forward with the sale of the Elliott was not easy. For far too long we have struggled to adequately fund our schools and give our children the world class education they deserve. As Treasurer, and a Land Board member, I have a constitutional responsibility to the state’s school children, and to balance competing public interests. I take this role seriously.

But in order move forward and meet our “undivided loyalty” obligation to the beneficiaries, we needed to improve the plan. The additional changes to the sale terms allow the state to meet its fiduciary responsibilities, as well as to provide enhanced recreational access and conservation measures, and provide the opportunity for additional tribal ownership of lands.”

This was really the only alternative in front of us that allows us to meet these competing public policy objectives.”

Treasurer Read proposed the following supplements to DSL’s protocols prior to signing a purchase sale agreement (PSA) with the respondents:

· The State will have the ability to repurchase up to $25 million worth of acreage that provides key conservation habitat, allowing for continued recreational, hunting, and angling access. If approved, Read explained that he hopes the Legislature will place that land into a state park status or wildlife conservation areas.

· DSL will negotiate the potential inclusion of Forest Stewardship Council (FSC) management principles and criterias into the existing conservation easement. Additionally, DSL should also work with the plan proposers to clarify protections for old growth stands over 250 years old.

· Finally, the Department shall include in the Purchase Sale Agreement a “right of first refusal” for the five Western Oregon federally recognized tribes on any lands that are put up by sale after transfer to Elliott Forest LLC.

Oregon School Boards Association news release:

The Oregon School Boards Association (OSBA) supports and applauds the State Land Board today for its action on the Elliott State Forest . Both new members of the State Land Board, State Treasurer Tobias Read and Secretary of State Dennis Richardson, clearly understand their fiduciary obligations as trustees of the Common School Fund. Both spoke about the need for them as State Land Board members to have an undivided loyalty to the current and future schoolchildren of Oregon. The action taken today moves the Elliott Forest process forward.

OSBA’s Executive Director Jim Green praised the steps taken today , saying “Treasurer Read’s action in making sure the sale of the Elliott can move forward is encouraging, and we greatly appreciate his efforts. The Elliott State Forest has caused a loss in value to the Common School Fund for several years and to allow that to continue would violate the State Land Board’s duty.

“While this is simply another step in the process, OSBA supports it. We will continue to monitor this process as it moves forward, and OSBA will take all necessary action to ensure that the Common School Fund remains whole and the fund’s assets are used for the benefit of Oregon’s schoolchildren.”

OSBA is a member services organization for more than 200 locally elected boards serving school districts, education service districts and community colleges. It also provides services to charter schools and their boards

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