CSSB 180(RES): "An Act authorizing the commissioner of natural resources to negotiate and enter into timber sale contracts that provide for local manufacture of high value-added wood products; and establishing an Alaska Forest Products Research and Marketing Program within the Department of Commerce and Economic Development."
00CS FOR SENATE BILL NO. 180(RES) 01 "An Act authorizing the commissioner of natural resources to negotiate and 02 enter into timber sale contracts that provide for local manufacture of high 03 value-added wood products; and establishing an Alaska Forest Products Research 04 and Marketing Program within the Department of Commerce and Economic 05 Development." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. LEGISLATIVE FINDINGS AND PURPOSE. The legislature finds that it is 08 in the best interests of the people and economy of Alaska to encourage the establishment and 09 sustainable operation of local timber processing facilities in Alaska to produce high value- 10 added wood products and other value-added wood products from timber cut on state land. 11 One means of encouraging such facilities is through the use of an incentive by reducing the 12 stumpage price of timber offered through negotiated timber sale contracts. The value-added 13 use of timber harvested in Alaska is intended to foster a stable, small scale, locally operated, 14 finished wood products industry by providing a steady reliable supply of timber at a reliable
01 rate over a period of time to a purchaser of the timber that will provide maximum 02 opportunities for jobs in Alaska without significantly adversely affecting fish and wildlife 03 habitat and the forest resources. 04 * Sec. 2. AS 38.05 is amended by adding a new section to article 4 to read: 05 Sec. 38.05.123. NEGOTIATED TIMBER SALES FOR LOCAL 06 MANUFACTURE OF WOOD PRODUCTS. (a) Notwithstanding the provisions of 07 AS 38.05.115 and 38.05.120, and upon a finding that the sale is in the best interest of 08 the state, the commissioner may negotiate a sale of timber for use in the local 09 manufacture of high value-added wood products. A timber sale contract entered into 10 under this section may provide for a harvest of up to 10,000,000 board feet of timber 11 each year, consistent with sustained yield principles, and may be for a term of up to 12 10 years. Initial stumpage rates for a contract under this section shall be determined 13 by negotiation but may not be less than the base price for the area as established under 14 regulations adopted by the commissioner. A contract under this section shall provide 15 that stumpage rates shall be redetermined by negotiation at least once every three years 16 during the term of the contract, to reflect changes in market conditions; the 17 redetermined rates may not be less than the base price for the area as established under 18 regulations adopted by the commissioner. The commissioner shall by regulation set 19 a maximum number of contracts, but not less than two, per region of the state that may 20 be negotiated each year under this section. 21 (b) Notice of intent to negotiate a contract under this section shall be given in 22 accordance with AS 38.05.945. 23 (c) The commissioner may negotiate a sale of timber under this section if the 24 prospective purchaser agrees to use to the maximum extent commercially practicable 25 the timber subject to the sale for the local manufacture of high value-added wood 26 products. The commissioner shall determine the maximum amount of the timber being 27 sold that is commercially practicable to use for those purposes and make the use of 28 that percentage of the timber for those purposes a term of the contract. In evaluating 29 proposals, the commissioner shall take into account the proposed manufacture of other 30 value-added wood products to be produced under a negotiated contract. 31 (d) Before a sale may be negotiated under this section,
01 (1) the area of the sale must be designated for forestry purposes by a 02 valid, existing area plan adopted under AS 38.04; and 03 (2) the requirements of AS 38.05.112 and 38.05.113 must be met. 04 (e) In making the best interest finding required by AS 38.05.035(e) and this 05 section, the commissioner shall consider, in addition to other factors, 06 (1) the direct economic benefit from the local manufacture of high 07 value-added wood products as a result of the sale; 08 (2) the direct economic benefit from other local processing of the 09 timber to be undertaken by the purchaser as a result of the sale, including the 10 manufacture of other value-added wood products in addition to high value-added wood 11 products; 12 (3) the likelihood of commercial success of the locally manufactured 13 high value-added wood products and other value-added wood products; 14 (4) the extent to which the sale is likely to result in the creation and 15 maintenance of a stable local job base; 16 (5) the existence of adequate protection measures to ensure the 17 sustainability of fish and wildlife habitat and populations and continuation of other 18 uses of the area subject to the negotiated sale; 19 (6) the stumpage return to the state; and 20 (7) any other reasonably foreseeable benefits to the state and local 21 economies from the sale. 22 (f) As part of the timber sale negotiations authorized by this section, the 23 commissioner may require a prospective purchaser negotiating a timber sale contract 24 to submit financial and technical data that demonstrates that the requirements of this 25 section have been or will be met. Upon the prospective purchaser's request, the 26 commissioner shall keep data provided by the purchaser confidential in accordance 27 with the requirements of AS 38.05.035(a)(9). 28 (g) If the commissioner determines that additional analysis is necessary in 29 order to complete the best interest finding for a sale under this section, the 30 commissioner may require the prospective purchaser to retain and pay for the services 31 of a contractor to assist the commissioner in evaluating the proposed negotiated sale
01 and financial and technical data relating to the proposed sale. The contractor shall be 02 selected by the prospective purchaser from a list of consultants in forestry and timber 03 economics provided by the commissioner. If the commissioner requires a prospective 04 purchaser to retain the services of a contractor under this subsection, the commissioner 05 shall determine the scope of the work to be performed by the contractor. 06 (h) Under this section, a performance review shall be completed not more than 07 five years after a timber sale contract is entered into by the department to ensure that 08 the purchaser is performing in accordance with the terms of the contract, and to 09 determine if an updated forest land use plan under AS 38.05.112 is needed. If the 10 commissioner determines that the 11 (1) purchaser is not performing in accordance with the contract, the 12 commissioner may terminate the contract; 13 (2) contract conflicts with the current forest land use plan, the 14 commissioner may terminate the contract if the conflict cannot be resolved, provided 15 that the commissioner may not terminate a contract under this paragraph for lack of 16 timber until the commissioner has made a good faith effort to find suitable replacement 17 timber. 18 (i) A timber sale negotiated under this section does not affect other timber 19 harvest programs under AS 38.05.110 - 38.05.120. 20 (j) In this section, 21 (1) "high value-added wood product" means kiln-dried or commercially 22 dried lumber, interior finish paneling, and trim, flooring, doors, and windows, cabinet 23 stock, furniture, musical instruments or parts of instruments, toys, tools and 24 implements, ready-to-assemble building kits, veneer, plywood, finger-jointed lumber, 25 house logs, and other similar finished wood products specified by the commissioner 26 by regulation and, for deciduous aspen, poplar, and high defect birch, includes 27 engineered wood products and paneled wood products; 28 (2) "other value-added wood product" means pulp, chips, waferboard, 29 chipboard, fiberboard, green lumber, cants, slabs, or planks intended for remanufacture, 30 and other similar wood products specified by the commissioner by regulation. 31 * Sec. 3. AS 44.33 is amended by adding a new section to read:
01 ARTICLE 10. ALASKA FOREST PRODUCTS 02 RESEARCH AND MARKETING PROGRAM. 03 Sec. 44.33.900. ALASKA FOREST PRODUCTS RESEARCH AND 04 MARKETING PROGRAM. (a) The Alaska Forest Products Research and Marketing 05 Program is established in the Department of Commerce and Economic Development. 06 (b) The program is established to provide a statewide information 07 clearinghouse and coordinator to gather and disseminate information relating to 08 research and development, including technical, logistical, financing, marketing and 09 other relevant information regarding the manufacture of specific value-added wood 10 products and the establishment of new high value-added manufacturing facilities in the 11 state, and to assist in coordinating existing research and development efforts by state 12 and federal agencies and other public and private entities. 13 (c) The program coordinator shall identify unfilled needs and problems 14 impeding the development of a high value-added wood products industry in the state, 15 gather information and conduct analyses, and propose solutions by exploring successful 16 models in other states and nations. 17 * Sec. 4. Notwithstanding AS 38.05.123(a), added by sec. 2 of this Act, the commissioner 18 may negotiate no more than two sales of timber each year for local manufacture of high value- 19 added timber products under AS 38.05.123 in each region of the state in calendar years 1996, 20 1997, and 1998.