PORT ANGELES — Clallam County and its junior taxing districts received $7.26 million in timber revenue from the state Department of Natural Resources last year, according to a treasurer’s report.
The sale of Clallam County timber on 92,525 acres of DNR-managed trust lands yielded $3.57 million to the trust beneficiaries in 2015, $7.74 million in 2014 and $5 million in 2013, the annual report said.
County Treasurer Selinda Barkhuis presented her 2017 Tax &Timber Report to other members of the county Finance Committee last week.
The 22-page report is available at www.clal lam.net/Treasurer.
While the sale of county timber is just one component of the report, DNR trust-land management became the focus of a robust discussion Thursday.
County Commissioner Bill Peach, who also serves as vice chair of the state Board of Natural Resources, said the report contains “valuable information” for such trust beneficiaries as schools, hospitals and fire departments.
“My compliments,” Peach told Barkhuis.
“Commissioners [in other counties] wish they had this historical data. Some of them are working on trying to build that.”
The Tax &Timber Report shows six years worth of revenue generated for 30 trust beneficiaries within the county.
Of the $7.26 million generated from DNR timber sales on county trust lands last year, state schools received $1.55 million, the county road department received $1.06 million and the county general fund got $1 million.
Other major beneficiaries were Port Angeles School District maintenance and operations ($649,752), Sequim School District maintenance and operations ($592,828), Sequim-area Clallam County Fire District No. 3 ($484,947) and Olympic Medical Center ($400,022).
DNR charges a 25 percent fee to manage county trust lands and distributes the rest to county treasurers with notations indicating what tax area generated the revenue, Barkhuis said in her report.
“The County Treasurer then distributes these funds to the taxing districts located within the relevant tax area, in proportion to their current levy rates, according to RCW [Revised Code of Washington] 79.64.110(1),” Barkhuis wrote.
The amount of revenue generated from DNR timber sales on Clallam County trust lands varies widely from year to year and tends to be cyclical, County Administrator Jim Jones said.
“I have found historically year over year that if we had a high year one year, the next year was low, and the next year was high,” Jones said.
Last year, DNR increased the sale of individual products, or sorts, which resulted in better prices for DNR and better returns for trust beneficiaries, Peach has said.
It also begin catching up with arrearage, the variance between the amount of timber that was supposed to be sold and wasn’t sold between 2005 and 2014, said Peach, a retired Rayonier regional manager.
Peach and others on the finance committee raised concerns about DNR’s revenue projections.
“The way I’m sharing this with a lot of people is: ‘I’m a member of a junior taxing district. I want to buy a new firetruck in seven years. How much money can I expect between now and then?’ ” Peach said.
“And right now, DNR cannot answer that question. That is terrible.”
DNR officials provide quarterly reports with revenue forecasts to commissioners in Clallam, Jefferson and other timber counties.
Chief Accountant Stan Creasey of the Clallam County Auditor’s Office noted that DNR projected $300,000 in timber revenue for the fourth quarter of 2016 and actually produced $3 million.
“I know that we’ve all been scratching our heads and wondering and hoping that we can get some better data and better projections from DNR,” Creasey said.
“Is there any reasonable hope that we’re going to get better information?”
Said Commissioner Randy Johnson, former Green Crow president: “I think we have a long way to go.”
“Can it be done? Absolutely,” Johnson added.
“A lot of us do those kinds of [projections] all the time in business.
“And things happen. Roads go out. Markets get better and they accelerate. But at least I know what’s coming for the year, plus or minus, pretty closely,” Johnson said.
The Clallam County Trust Lands Advisory Committee voted unanimously last November to recommend a detailed forest inventory with annual updates from DNR.
“We had some meetings to crawl into the nuts and bolts,” Peach said of his conversations with staff. “You know what this really boils down to? Information management.”
Peach, who represents 21 timber counties on the Board of Natural Resources, said he was committed to working with DNR to improve information management.
He added that the revenue projections have been a “genuine concern” for other timber counties.
Later this year, the Board of Natural Resources will consider adopting a 10-year sustainable harvest level and a long-term conservation strategy for the marbled murrelet, a threatened seabird that nests in coastal forests.
The draft environmental impact statement for the sustainable harvest target includes several options that will affect the 92 million board feet of Clallam County timber that was left in arrears in the past decade.
Last Monday, Port of Port Angeles commissioners approved a statement to the Board of Natural Resources supporting the alternative that would allow the highest volume of timber harvest.
That option would incorporate the 702 million board feet of total arrearage from Clallam and counties that were undercut between 2005 and 2014 into the next sustainable harvest target.
Commissioners in Joyce-area Clallam County Fire District No. 4, which received $77,239 from DNR timber sales last year, passed a similar resolution Tuesday.
The port received $146,242 from DNR timber sales last year, according to Barkhuis’ report.
Another option being considered by DNR would subtract the timber that was over-harvested in other counties from the net, leaving 462 million board feet of arrearage to be cut.
One option would result in no harvest of the arrearage.
After the Board of Natural Recourse makes its decision on arrearage, Peach said he would endeavor to keep the agency on track.
“My personal goal, as a member of the Board of Natural Resources, is to set up a system so that in 10 years, the arrearage is zero,” Peach told the finance committee.
“And the way that you can make that happen is transparency every year and reporting on a very regular basis so that you don’t go 10 years and find out that there’s 92 million feet due this county.
“What drives it is information management and transparency,” Peach added.
Clallam County budgeted to receive $1.2 million in timber revenue for its general fund in 2017.
Barkhuis noted that the county road department, which gets more timber revenue than the general fund, budgeted $683,000.
Jones said the general fund projection was adjusted by commissioners at the last minute to “reflect the fact that something is going to happen with arrearage.”
“We’re going to see a significant amount of money in 2017 to clear up some of that past arrearage,” Jones said.
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Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 56450, or at rollikainen@peninsuladailynews.com.
