Environmental Law Section Blog: DNR Responds to Changes and Challenges in Wisconsin’s Forest Products Industry:

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  • Environmental Law Section Blog
    August
    25
    2020

    DNR Responds to Changes and Challenges in Wisconsin’s Forest Products Industry

    Kassie Lang, Sara Fox

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    Forests cover nearly half of Wisconsin’s landscape, and forest products play an important role in the state’s economy. Kassie Lang and Sara Fox discuss a history of the state’s forest products industry and legal mechanisms adopted in response to past challenges, and consider responses to the recent idling of one of the state’s largest mills.

    The 17 million acres of forests in Wisconsin – covering nearly half of the state – provide significant ecological, social, and economic benefits to the state and its residents.

    Wisconsin has been a national papermaking leader for more than six decades, and the forest industry contributes more than $24 billion a year to Wisconsin’s economy. Forestry’s economic impact reaches every corner of the state, and the forest industry is the top employer in 10 Wisconsin counties.

    Wisconsin’s forests are a renewable resource that is growing in volume each year. More than 7.4 million acres of forestland in Wisconsin have been verified under third-party forest certification programs, providing assurance of sustainable forestry practices while the industry meets ever-growing demands.

    Kassie Lang Kassie Lang, U.W. 2014, is a staff attorney with the Wisconsin Department of Natural Resources in Madison, where she works on forestry, air, drinking water, and groundwater legal issues.

    Sara Fox Sara Fox, U.W. Class of 2022, served as a summer 2020 law clerk at the Wisconsin Department of Natural Resources.

    However, the forest products industry has been affected by global changes in the marketplace, changing demographics of woodland owners along with many other factors, including recent challenges posed by the COVID-19 pandemic.

    Verso’s Idling of Its Wisconsin Rapids Mill

    In June 2020, the Verso Corporation – a major Wisconsin paper company – indefinitely idled its Wisconsin Rapids pulp and paper mill. The Wisconsin Rapids mill purchased approximately 25% of the pulpwood produced in Wisconsin and employed more than 900 people.

    The direct and indirect impacts on the economy and the environment will be widespread. Since that announcement, many state and local officials, including the Wisconsin Department of Natural Resources, have been working to provide support.

    Forests Built Wisconsin

    Wisconsin’s timber history runs deep. Wisconsin was a world leader in lumber production in the 1800s, and that wood built communities across Wisconsin as well as cities across the Midwest.

    However, after the timber was harvested, “cutover” land had little value for nonforest uses, and owners of the land struggled to pay taxes. Some of this land was purchased by or donated to the state Board of Forestry to create and develop a state forest reserve. Other lands became tax delinquent and reverted to county ownership. The tax delinquency of the cutover land led to the creation of laws and policies that still guide the management of forests in Wisconsin today.

    The Wisconsin Constitution article VIII §10 was amended in 1924 to allow state funding of the acquisition and development of state forests. In 1927, the public ratified another constitutional amendment, which pertained to the uniformity tax clause in article VIII §1. This paved the way for the passage of the Forest Crop Law, a precursor to the current Managed Forest Law and an early variant of the County Forest Law.

    These laws created a solution to the issue of tax delinquency, and encouraged the return of these lands to timber production. Tax-delinquent lands that reverted to county ownership formed the base of today’s county forests – a network of 2.4 million acres providing vital economic support to 30 counties along with wildlife habitat, watershed protection, and recreation opportunities. Through the County Forest Law, the state provides technical and financial assistance to support sustainable forestry on these county forests.

    The Forest Crop Law and Managed Forest Law programs provide a reduced property tax rate in exchange for sound forest management for timber production and, in many cases, recreational access for the public.

    Enrollments in the Managed Forest Law increase each year and the program continues to encourage sustainable forestry on private woodlands in Wisconsin. Given that more than half of the forestland in our state is owned by individuals and families, this program continues to be important to the sustainable management of forests in Wisconsin.1

    Impact of the Verso Mill Closure

    Markets for Wisconsin timber – such as the Verso Mill – are vital for practicing sustainable forestry on family woodlands as well as on public forests.

    Verso’s Wisconsin Rapids mill began operations in Wisconsin in 1904. The mill produced graphic papers used in commercial printing; media and marketing advertisements, including magazines, catalogs, retail inserts; and direct mailings. The mill also supplied pulp to nearby paper mills.

    In addition to the 902 workers employed by the mill, more than 500 different loggers and trucking firms supplied timber to the mill. Timber processed at the mill came from a variety of land ownership types and often helped to sustain local economies. For example, timber from county forest lands generated revenue for local county governments. In Ashland County, 40% of harvested pulpwood was shipped to the Wisconsin Rapids mill, which generated approximately 11% of the county’s revenue.

    DNR Outreach and Assistance

    DNR’s Forest Products Services program is working with industry partners to understand the impact of the Verso mill idling on the supply chain and to provide analyses using data and modeling. The DNR Tax Law Section, which implements the Forest Crop Law and Managed Forest Law programs, is working with landowners to offer flexibility for the timing of mandatory harvests.

    The many teams of foresters who establish and administer timber sales under the authority of Wis. Stat. sections 28.05 and 26.22 are working on a solution to address the more than 500 current timber sale contracts for harvests on state-owned land, many of which are directly impacted by the Verso idling, and many others that are indirectly impacted through a drop in pulpwood prices.

    DNR’s county forest liaisons and other staff are communicating and collaborating with the counties enrolled in the County Forest Law to ensure that DNR’s operational changes will align with and support their solutions.

    The Good Neighbor Authority program, through which DNR has partnered with the USDA Forest Service to establish and administer timber sales on national forest land in the state under Wis. Stat. section 28.15, has already seen impacts from the softening wood market, and is similarly working to quantify impacts and decide on a path forward.

    Other DNR staff are participating in the Wisconsin Rapids Together Task Force, and have reached out to forest products industry partners, local legislators, and community groups to offer assistance.

    As a former forestry professional, DNR Secretary Preston Cole has committed the agency to working on a path forward that promotes the continued protection and sustainable management of Wisconsin’s forest resources for the benefit of Wisconsin’s economy and its residents.

    The Environmental Law Section, in partnership with State Bar PINNACLE, presents the 32nd Annual Environmental Law Update 2020, offered as a live webcast on Thursday, Sept. 10, 2020. The section is offering two scholarships to section members to attend. For full details please see scholarship application. The deadline to submit an application is Friday, Aug. 28.

    This article was originally published on the State Bar of Wisconsin’s Environmental Law Section Blog. Visit the State Bar sections or the Environmental Law Section web pages to learn more about the benefits of section membership.

    Endnote

    1 To see a map of land cover types in Wisconsin as of February 2020, see Map 2 on page 16 in the Division of Forestry’s Wisconsin 2020 Statewide Forest Action Plan.





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    Disclaimer: Views presented in blog posts are those of the blog post authors, not necessarily those of the Section or the State Bar of Wisconsin. Due to the rapidly changing nature of law and our reliance on information provided by outside sources, the State Bar of Wisconsin makes no warranty or guarantee concerning the accuracy or completeness of this content.

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