Thursday, September 18, 2008
Supervisors meet tree farmers halfway
By SUE WATSON
A concerned board of supervisors met with three Marshall County tree farmers again at last week’s board meeting to work for a compromise on the ordinance that required all loggers post a road bond or letter of credit with the county.
Supervisor Ronnie Joe Bennett was a driving force in meeting the compromise, saying he knows the logging business as well as appreciates the concerns of residents that county roads not be torn up by loggers’ rigs.
He insisted that it be settled Monday – saying he has been receiving too many phone calls about the issue.
Bennett said the board failed to make good on a commitment to establish a panel to come up with solutions. Art Waymire, Buck Hobbs and George Murphree, with the Marshall County Forestry Association, said the road bond requirement was shutting down timber harvest in the county. They urged supervisors to drop the road bond or reduce its scope.
“I think we need to grandfather (those tracts with existing contracts to harvest timber) and get it settled,” Bennett said. “Time is running out.”
Hobbs said one tree farmer has a contract that “is short on time.”
Hobbs said three outfits buy about 75 percent of the timber in Marshall County.
“A broker with Georgia Pacific said they cannot buy a large tract of timber and expose their company to that risk (bond risk),” he said.
Waymire read a list of 10 points why tree farmers object to the road bond requirement for loggers, followed by Murphree who presented a situation where a buyer wanted to know what would be required to get 600 acres of timber out of the field before it spoils.
The tract contains timber down or damaged during a tornado that struck in Benton County near Snow Lake. Ingress and egress would be along Scales Tower Road.
County administrator Larry Hall and supervisor Willie Flemon expressed concern that Scales Tower Road would be ruined from one end to the other by an estimated 1,100 loads of logs (up to 84,000 pounds per load, including truck) that will come out of the 600-acre plot.
The Forestry Service is seeking to get the timber off the ground before it sours from rain and weather and is useless.
“I want something settled, either do or don't,” said Bennett. “I am getting lots of calls. They are in limbo. I would like to settle with bond, no bond, grandfather in or no grandfather (timber already under contract prior to bond order).”
Murphree said the association could not advise the timber owner what to do and the timber had not been sold to a buyer yet.
“Most surrounding counties have no bond on any roads,” Murphree said. “Nobody is bidding in Marshall County and some timber buyers say they won’t bid.”
Weymire added that timber land is taxed higher than other agricultural lands, the industry is the number one industry in the county and tree farmers can’t get a return on their investment until timber stands mature at 30 to 35 years. Most tree farmers plant land in timber as an investment in their grandchildren’s college education, he said. But with the bond on, tree farmers would not break even on thinning stands twice before it matures, he said.
He said 20 percent of the severance tax on all timber harvested in the county goes to the county and 80 percent to replanting trees.
Weymire questioned whether the county bond order would violate Federal anti-trust laws.
“We don’t want that to happen,” he said.
Board attorney Kent Smith said the county ordinance was identical to the one Calhoun County has passed with the only exception of the road bond requirement.
“The constitution of the state vests this board with maintaining and protecting all county roads,” he said. “The bond was an effort to collect and get roads repaired for any damage beyond normal wear and tear. So many loggers come in and damage the roads and are gone. So the bond allows us to get the loggers’ addresses.”
Hall added that the bond ordinance also applies to haulers, road construction companies, dirt haulers, not just loggers.
Supervisor Keith Taylor said many of the county roads do not have hardened surfaces for financial reasons.
“I agree, we have to find a compromise,” he said. “We can’t alienate timber sales. But people sometimes have waited 25 years to get their road paved, then loggers damage the road. My problem is taxpayers pay high taxes, but as a supervisor, if nobody on the road damaged the road except a timber hauler, I don’t think at the end of the day it balances out. The timber tax revenues would not pay for the road repair.”
Hobbs said that some roads next to timber lands will require no bond while others will. The timber buyer will have to pay for the timber and the bond, he said.
Although the interest on the bond is not much, the logging truck will find a void under the road and break through, he said.
He questioned whether prefilming the road would reveal where the weak spots in the road are.
“But we agree where a logger comes out (of the woods) he is going to tear something up,” Hobbs said. “The county could say what the damage on the road is and fix it.”
“We have got to find a middle ground,” Taylor said.
Either the county would have to hire an attorney to try to recover the damage to a road or the hauler would pay voluntarily to repair it, he said.
“This is common sense,” said Taylor. “We all pay taxes. We don’t need to stall the harvest of timber. I know the timber industry is a powerful thing. Somebody other than the taxpayer ought to be responsible for the damage.”
Hobbs said he agreed and suggested haulers be required to obtain a permit.
“If he damages the road, do not give him another permit,” Hobbs said.
Flemon asked if that meant the hauler would have to pay damages.
“You don’t (collect damages) but he won't be back,” said Bennett. “He won’t do it twice.”
Bennett suggested the Marshall County Forestry Association stand behind loggers and make the association members pay for the damages.
“We need some way to get ahold of loggers and the only way to get hold of them is through a bond,” he said.
Taylor agreed but said if no damage is found after logging takes place, no bond should be needed.
“How can we be sure there will be no damage?” he asked.
Hall said the county could inspect the road before and after logging, and the county could mark any spots in the road in the initial inspection.
Bennett suggested that just a portion of the road could require a bond, and if that part is torn up by loggers, they would have to pay for it, but not for repairing the whole road.
“What about a guy with 25 acres of timber and you want a $190,000 bond?” Weymire asked.
Hobbs said a businessman could not expose his company to $50,000 bond per mile of road. He said the small landowner who has everything he owns in a little timber would not be able to get it cut.
“That’s why they won’t bid,” Weymire added.
“That comes down to communication and finding out what will be required,” said Bennett.
Taylor said a permit to log would go a long way toward a remedy.
“Is your group against any kind of bond?” asked supervisor George Zinn III.
“We are just communicating to you what we have been told,” said Hobbs.
“The bond is the unknown,” said Weymire.
Smith helped fashion the final solution, suggesting that a bond only be required to cover any repair at the point of egress/ingress to the woods where there is bound to be some road damage.
“We can sue the logger for that (damage), the bond is just an insurance contract,” he said.
Hobbs said timber consultants and area farmers had been asked their opinions.
“Rankin County let loggers post a $25,000 bond renewable every year,” he said.
After the logger posts bond, they could work any number of sites in the county that year.
“The county would establish what to fix and fix it and the logger pays up so that the bond is not called,” Hobbs said. “That works well down there.”
Otherwise buyers would say there is too much timber in North Mississippi to bother with Marshall County (and not buy timber here), Hobbs said.
“That’s blackmail right there,” said Bennett.
Hobbs said that “the size of the bond is what scares them (buyers) to death.”
“We have to come to some agreement so we can go back and sell timber,” he said. “If we can get something to address the ingress/egress and bond for it, we may have something to work with.’
The cost of the bond (interest) is non-refundable, he said.
“You don't get that money back,” Hobbs said.
Other counties could follow Marshall County’s example and put the timber industry out of business, he said.
“For an independent logger, you take one job away from him and he’s out of business,” said Hobbs. “If we put our standards where they should be, a contractor may have just bought a tract of timber he can’t harvest.”
Hall said gravel pit haulers bond themselves against damages.
“These local loggers can’t get bonded,” he said.
Smith said if loggers post bond for ingress/egress, then pay the county back for the cost of fixing the damage, then the bond could work.
Bennett explained that insurers will not sell a bond to anyone unless they own enough property to stand for the bond.
“If you are not worth what your bond is, you are not going to get your bond,” he said, “unless you put up everything you’ve got including your house. A bond puts pressure on folks, but you’ve gotta be pretty stout to get bond. We want y’all to understand, we are going to make them fix this spot (that is damaged).”
Hobbs suggested the board require a permit and do away with the bond requirement and give no logger a second permit who does not repair what he breaks up.
“Six to 12 months down the road, if that doesn’t work, let’s talk about a smaller bond that will serve a number of sites,” Hobbs said.
With 70 percent of the tree farmers owning less than 100 acres of land in the county, the number of loads coming out of the woods would be small even if the land was clear-cut, he said.
Hobbs said if a log truck finds a soft spot in the road, it could be filled “and you are through with it.”
“No, you are not,” said Hall. “You’ve got to find the source of it. Would Marshall County Forestry Association consider a general bond for its members?”
Hobbs reiterated his request to require loggers to get a permit and deny them a second chance if they tear up the road.
“If we make our point, I think we will have loggers more respectful in this county,” he said. “Let’s get this industry restarted and restarted fast.”
He said the requirement to fix the road could be built into the permit.
Taylor said just because loggers have been getting away with tearing up roads for years, “that doesn’t make it right.”
Flemon said it is the supervisors “who get the heat.”
Weymire added that ultimately the responsibility comes back on the farmer.
The board tabled the discussion, went into executive session, then passed a motion on the matter afterward.
Supervisor Eddie Dixon made a motion to tie the logger’s permit to a requirement that the logger pay for any road damages at the entrance and exit to the woods by logging equipment and any other damages. The permit would also require loggers adhere to a route in and out to the state highway. The permit requirements would be enforced and the period for trying this solution would run for a year. If it does not work the matter would be taken up again.
Supervisors voted unanimously to pass the motion.
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