The Economic Contribution of Stewardship Contracting: Two Case Studies from the Mount Hood National Forest

Journal of Forestry, May 2018

We conducted an economic analysis of two case study stewardship contracts on the Mount Hood National Forest in western Oregon. Stewardship contracting has been embraced by some federal managers to achieve restoration goals while providing economic benefits to local communities. Little is known about economic contributions from stewardship contracts, including how they compare against Secure Rural Schools funding or the century-old payments to counties revenue sharing system. Using expenditure data from sale purchasers, contractors, and fiscal agents, we developed methodology to track spending and used IMPLAN software to estimate economic contributions and multipliers. Results showed that (1) commercial thinning, service work, and retained receipts projects all contributed to local economic activity; (2) expenditures accounted for $4 million in output and generated 36 jobs, with output and job multipliers of 1.42 and 1.82, respectively; and (3) benefits were distributed across a wider variety of economic sectors than timber harvesting alone.

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The Economic Contribution of Stewardship Contracting: Two Case Studies from the Mount Hood National Forest

J. For. The Economic Contribution of Stewardship Contracting: Two Case Studies from the Mount Hood National Forest Jean M. Daniels 0 Max Nielsen-Pincus 0 Michael Paruszkiewicz 0 Nathan Poage 0 0 Affiliations: Jean M. Daniels We conducted an economic analysis of two case study stewardship contracts on the Mount Hood National Forest in western Community Self-Determination Act of 2000 Oregon. Stewardship contracting has been embraced by some federal managers to achieve restoration goals while pro- (P.L. 106-393). SRS funding was intended to viding economic benefits to local communities. Little is known about economic contributions from stewardship contracts, decouple county payments from federal harincluding how they compare against Secure Rural Schools funding or the century-old payments to counties revenue vest and reduce reliance on timber receipts. sharing system. Using expenditure data from sale purchasers, contractors, and fiscal agents, we developed method- The current SRS authority expires in ology to track spending and used IMPLAN software to estimate economic contributions and multipliers. Results showed 2017, and the uncertain future of SRS that (1) commercial thinning, service work, and retained receipts projects all contributed to local economic activity; (2) funding has implications for federal timber expenditures accounted for $4 million in output and generated 36 jobs, with output and job multipliers of 1.42 and 1.82, policy. Under the Secure Rural Schools respectively; and (3) benefits were distributed across a wider variety of economic sectors than timber harvesting alone. Act, an eligible county could elect to receive a Secure Rural Schools Act payment - Acknowledgments: This project was funded by the Pacific Northwest Research Station. We thank the staff of the Mount Hood National Forest, the Clackamas Stewardship Partners, and the Clackamas River Basin Council for their assistance and data. The objective of this paper is to for- The other relevant authority is that7t2hecounties in Oregon, Washington, and malize a discussion about the economic conf-orest can keep receipts generated through nseolrl-thern California to receive the average tribution of stewardship contracts. Using tinwgoforest products, providing additional fuonfdstheir three highest timber harvest revenu case studies from the Mount Hood Nationfaolr restoration work. If value of timber or optahyemrents from fiscal year 1986 to 1999 inForest (MHNF) in northwestern Oregong,oods created from a stewardship contractsitnegad of traditional payments tied to harvestwe performed an economic assessment of thperoject exceeds the cost of contracted serivnigc.e All affected counties in Oregon opted commercial thinning and contracted servwicoerk, the excess receipts are retained by tthoe receive SRS funding instead of federal work performed by the timber purchaserf,orest. Projects funded using retained receripetcseipts sharing payments. and subsequent restoration work fundeadre selected by a local forest collaborativeSRS funding replaced timber receipt using retained receipts. To date, the literatgurroeup. The ability to retain the excess receipshtsa,ring with guaranteed levels of payments contains almost no information about horwather than send them to the US Treasury, hnaost tied to timber sales. The intent was retained receipts are used, who gains, anednabled the Forest Service to complete forteostprovide consistent and reliable support how they are leveraged within the grearteesrtoration projects that may not have befeonr counties to help them transition away ecological restoration community. This typpoessible otherwise (GAO 2008). Currentlyf,rom federal timber. SRS funding has been of socioeconomic monitoring could helapll national forests in the Pacific Northrweenstewed several times since it expired in inform comparisons between contractinAgdministrative Region of the Forest Servi2c0e06, each time at reduced levels. Failure methods to achieve management goals. have used stewardship contracts as part of tthoeirreauthorize the Act in 2017 would re We begin with an overview of stewardl-and management activities (Daugherty 2017s)u.lt in county payments reverting back to ship contracting and county payment policy, 25% of timber receipts. Stewardship conand then review the literature on economCiocunty Payments tracts represent an opportunity for the fedmonitoring of restoration and stewardshWipith passage of the Payments to States laewral managers to achieve restoration and contracts. Then we introduce our two cianse1908, Congress recognized the need thoarvest goals while also contributing to studies, describe economic contributiocnompensate local counties containing elxo-cal economies. However, payments from methodology, and present analysis resultes.nsive tracts of federal forestland. Untdimerber sales were made directly to county We end by discussing the economic contrti-he law, the United States Forest Servgicoevernments, while r (...truncated)


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Daniels, Jean M, Nielsen-Pincus, Max, Paruszkiewicz, Michael, Poage, Nathan. The Economic Contribution of Stewardship Contracting: Two Case Studies from the Mount Hood National Forest, Journal of Forestry, 2018, pp. 245-256, Volume 116, Issue 3, DOI: 10.1093/jofore/fvx020