PowerPoint-Tmplt-DNR-darkgreen w/# & footer - WA - DNR
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Board of Natural Resources Arrearage Subcommittee Report
Update for the July BNR meeting
Kyle Blum July 7, 2015 1
Draft Subject to Change - July 2015
Arrearage Subcommittee Report Causes of the Arrearage Purpose Review Subcommittee Analysis Requests and Questions Next Steps
2
Draft Subject to Change - July 2015
Board of Natural Resources Update
CAUSES OF THE ARREARAGE
3
Draft Subject to Change - July 2015
Arrearage Subcommittee Causes of the Arrearage
Riparian Marbled Murrelet Long-term Conservation Strategy Land Transactions
4
Draft Subject to Change - July 2015
Arrearage Subcommittee State Trust Land Expenditures ($ Millions)
Causes of the Arrearage $80
$60
$40
$20
$0
2005
2006
2007
2008
2009
2010
2011
2012
2013
Fiscal Year FDA
5
RMCA
Sustainable Harvest Budget Projection
Draft Subject to Change - July 2015
2014
Board of Natural Resources Update
SUBCOMMITTEE REVIEW
6
Draft Subject to Change - July 2015
Arrearage Subcommittee Steps From RCW 79.10.330 Description
Status
Determine if there is an arrearage.
Completed
Step 2
Conduct an economic and environmental analysis of options providing for the greatest return to the trusts.
In Progress
Step 3
Board determines a course of action.
Post Subcommittee Recommendations
Step 1
7
Draft Subject to Change - July 2015
Arrearage of 438 MMBF
Board of Natural Resources Update
SUBCOMMITTEE ANALYSIS REQUESTS AND QUESTIONS
8
Draft Subject to Change - July 2015
Arrearage Subcommittee
Analysis Requests and Questions Provide additional research on the history of arrearage and what the board has done at the end of previous planning decades. Determine the planning horizon the industry uses for log supplies, both short and long-term. Provide additional research on the best times to sell an arrearage if such sale is determined to be in the best interest of the trusts. Provide additional analysis on the economic factors of an arrearage. Provide additional analysis on the impacts to the department and future harvests if the arrearage was sold. 9
Draft Subject to Change - July 2015
Arrearage Subcommittee
Analysis Requests and Questions: Additional Analysis for Economic Factors Washington State Harvest Volume (MBF) with Export
3,000
Board feet (millions)
2,500
2,000
1,500
1,000
500
0
2004
2005
2006
2007
2008
2009
2010
2011
Year State
Private
Federal and other public
Data from Department of Revenue
10
Draft Subject to Change - July 2015
Export levels **
2012
2013
Arrearage Subcommittee
Analysis Requests and Questions: Additional Analysis for Economic Factors Sustainable Harvest Value (millions) 300
Dollars (millions)
250
200
150
100
50
0
2004
2005
2006
2007
2008
2009
2010
2011
Year Actual with out TLT
Projected
Actual with TLT
Data from Department of Revenue
11
Draft Subject to Change - July 2015
2012
2013
2014
Arrearage Subcommittee
Analysis Requests and Questions Timber Volume Sold Harvest volume (MMBF)
700 600 FY14 harvested ~450 MMBF from
approximately 17,000 acres
500
Estimated Total Cost: $24.5 million - Direct Costs: ~$12 million presales and compliance 300 - Indirect Costs: ~$10 million to site prep, 200 plant, vegetation management, support staff, etc. - Agency Admin: ~$2.5 million for rent, legal, 100 IT support 400
0
FY05
FY06
FY07
FY08
W.WA Sold
12
FY09 FY10 FY11 Fiscal Year
FY12
2007 SHC Planned W.WA
Draft Subject to Change - July 2015
FY13
FY14
Arrearage Subcommittee Next Steps
Policy Recommendations Final Report to the Board of Natural Resources
13
Draft Subject to Change - July 2015
Board of Natural Resources Arrearage Subcommittee Report
Update for the July BNR meeting
Kyle Blum July 7, 2015 1
Draft Subject to Change - July 2015
Arrearage Subcommittee Report Causes of the Arrearage Purpose Review Subcommittee Analysis Requests and Questions Next Steps
2
Draft Subject to Change - July 2015
Board of Natural Resources Update
CAUSES OF THE ARREARAGE
3
Draft Subject to Change - July 2015
Arrearage Subcommittee Causes of the Arrearage
Riparian Marbled Murrelet Long-term Conservation Strategy Land Transactions
4
Draft Subject to Change - July 2015
Arrearage Subcommittee State Trust Land Expenditures ($ Millions)
Causes of the Arrearage $80
$60
$40
$20
$0
2005
2006
2007
2008
2009
2010
2011
2012
2013
Fiscal Year FDA
5
RMCA
Sustainable Harvest Budget Projection
Draft Subject to Change - July 2015
2014
Board of Natural Resources Update
SUBCOMMITTEE REVIEW
6
Draft Subject to Change - July 2015
Arrearage Subcommittee Steps From RCW 79.10.330 Description
Status
Determine if there is an arrearage.
Completed
Step 2
Conduct an economic and environmental analysis of options providing for the greatest return to the trusts.
In Progress
Step 3
Board determines a course of action.
Post Subcommittee Recommendations
Step 1
7
Draft Subject to Change - July 2015
Arrearage of 438 MMBF
Board of Natural Resources Update
SUBCOMMITTEE ANALYSIS REQUESTS AND QUESTIONS
8
Draft Subject to Change - July 2015
Arrearage Subcommittee
Analysis Requests and Questions Provide additional research on the history of arrearage and what the board has done at the end of previous planning decades. Determine the planning horizon the industry uses for log supplies, both short and long-term. Provide additional research on the best times to sell an arrearage if such sale is determined to be in the best interest of the trusts. Provide additional analysis on the economic factors of an arrearage. Provide additional analysis on the impacts to the department and future harvests if the arrearage was sold. 9
Draft Subject to Change - July 2015
Arrearage Subcommittee
Analysis Requests and Questions: Additional Analysis for Economic Factors Washington State Harvest Volume (MBF) with Export
3,000
Board feet (millions)
2,500
2,000
1,500
1,000
500
0
2004
2005
2006
2007
2008
2009
2010
2011
Year State
Private
Federal and other public
Data from Department of Revenue
10
Draft Subject to Change - July 2015
Export levels **
2012
2013
Arrearage Subcommittee
Analysis Requests and Questions: Additional Analysis for Economic Factors Sustainable Harvest Value (millions) 300
Dollars (millions)
250
200
150
100
50
0
2004
2005
2006
2007
2008
2009
2010
2011
Year Actual with out TLT
Projected
Actual with TLT
Data from Department of Revenue
11
Draft Subject to Change - July 2015
2012
2013
2014
Arrearage Subcommittee
Analysis Requests and Questions Timber Volume Sold Harvest volume (MMBF)
700 600 FY14 harvested ~450 MMBF from
approximately 17,000 acres
500
Estimated Total Cost: $24.5 million - Direct Costs: ~$12 million presales and compliance 300 - Indirect Costs: ~$10 million to site prep, 200 plant, vegetation management, support staff, etc. - Agency Admin: ~$2.5 million for rent, legal, 100 IT support 400
0
FY05
FY06
FY07
FY08
W.WA Sold
12
FY09 FY10 FY11 Fiscal Year
FY12
2007 SHC Planned W.WA
Draft Subject to Change - July 2015
FY13
FY14
Arrearage Subcommittee Next Steps
Policy Recommendations Final Report to the Board of Natural Resources
13
Draft Subject to Change - July 2015
