Exhibit M- SF_Harvest_Scheduling_Over_Sixty_Years.pdf

State Forest Planning and Harvest Scheduling Methods Over the Last Sixty Years

The State Forests Division has been conducting forest planning and harvest scheduling since the mid- 1950’s using a variety of methods. The purpose of this paper is to provide a summary of the various methods that were used. This document is based on a review of the planning and harvest scheduling documents available in the State Forests Library; no search for the records in the State Forester’s Office and the State Archives was conducted do to time constraints. A separate document prepared by Mike DeLaune compares the harvest volume estimates of these various methods for the plans produced from the 1950’s through the early 1980’s.

1950 through 1970 Little documentation remains from these early plans; generally only two or three pages per plan.

However, some key points regarding the planning procedures can be deduced from this evidence:

• The Division recognized the different goals for BOF and CSL and it had a sustained yield policy;

however, no other records remain of more specific policies.

• Allowable Cut calculations were based on County/Fund and hemlock/Douglas-fir stands (i.e.

Douglas-fir stands on BOF lands in Clatsop County were considered a “Sustained Yield Unit”).

• Remaining records only address harvesting; other management activities are not addressed in the available records although significant planning must have been occurring for the reforestation of the Tillamook Burn.

• Harvest volumes were projected out 100 years.

• Inventory had been completed in each planning unit just before planning commenced, although the inventory methods are not documented.

• Growth and Yield information was apparently based on Bulletin 2011, although in some instances it appears to have been based on an analysis of the local inventory.

• The “Allowable Cut” methodology based on 10-year age classes and rotation length:

o Douglas-fir rotations of 90 to 100 years o Hemlock rotations of 70 years o A standard set of forms were used for conducting the calculations.

o For the first decade, the total acres and volume over the rotation age were summed and divided by ten to determine annual allowable cut o The calculations were based on gross acres with no allowance for riparian areas or any other inoperable area o Harvest volumes in board feet based on 32 foot logs.

1 Technical Bulletin 201 – The Yield of Douglas Fir in the Pacific Northwest; R. E. McArdle, W. H. Meyer, and D.

Bruce; United States Department of Agriculture; 1961.

• The documentation is not clear, but responsibility for the approval of these plans seemed to bounce between the Timber Management Director and the Assistant State Forester.

• In 1968 there was legislative direction to increase timber harvests on State Forests under a six point program, including: more thinning, expansion of positive reforestation measures, conversion of brush lands and scrub alder stands to conifer, completion of a primary road network in 10-years, and fertilization.

1971 through 1980 Significant advances were made in forest planning during the 1970’s in terms of technical process and breath of analysis.

• Extensive policies and procedures with developed in 1971 for planning and the calculation of the Allowable Cut. These procedures included significant economic analysis of rotation lengths and young stand management activities (a copy of this information is available in the State Forests Library).

• The economic analysis of young stand management activities:

o Included planting, interplanting, various types of site preparation and release, conversion of brush fields and alder stands to conifer plantations, pre-commercial thinnings, and fertilization o Considered operability (logging system), discount rate, and internal rate of return o Resulted in specific guidelines for when and where to conduct these activities o Was considered a business case for conducting these activities.

• The Allowable Cut calculation used Sustained Yield Units of Fund and District, but not species.

o A Willamette Region Sustained Yield Unit was considered during the planning process, but it was rejected because it did not produce appreciably higher harvest volumes.

• The OSCUR2 inventory was developed for this planning process and was completed on each district prior conducting the planning.

• Growth and yield information was derived from Washington State Tariff Tables3. Yield tables were produced by species (Douglas-fir/hemlock) based on five management regimes and four site classes. Volume was expressed in cubic feet.

• A computer simulation model was used to generate sustainable annual harvest volumes.

Multiple runs were conducted with different harvest parameters based on professional judgment. The computer model was called Simulating Intensively Managed Allowable Cut (SIMAC) was published by the USFS in 1971.

2 OSCUR stands for “Ownership, Soils, (vegetative) Cover, (land) Use, and (operation [i.e. logging system] Rating”.

This stand inventory was developed by the State Forests Division in the early 1970’s . It was succeeded by the OSCUR II inventory that was implemented in the early 1980’s and remained in use until the early 2000’s when it was replaced by the Stand Level Inventory (SLI).

3 Turnbull et al; 1970; Comprehensive Tariff Tables for the State of Washington, Department of Natural Resources.

o The acres in the various “Conservancy Use Classes” (precursor to FLMCS)4 were deducted from the gross acres prior to the model runs.

o The long term sustained yield generated by the harvest modeling was based on cubic feet of timber volume harvested; the model provided equivalent values in board feet and acres harvested by cover type.

• In addition to anticipated volume, the resulting plans estimated revenue distribution, annual employment in logging and milling, and indirect annual benefits (income generated and jobs outside the industry).

• Although the plans were based on long term sustained yield, they were considered 30-year plans. While the plan’s goal was an even flow of volume, there was a guidance to make an attempt at producing an even flow of revenue.

• Annual harvest objective given to the Districts was in acres harvested by cover type based on an agency directive titled “Management By Objective”5; this was a budgeting directive that required annual harvest objectives to be stated in acres, because it was to easier to predict the work load in FTEs based on harvest acres than harvest volume.

• The plans were prepared by the Director of Inventory, Analysis and Planning, but there is no documentation regarding the formal approval of these plans.

1981 through 1990 The planning and harvest scheduling processes of the 1980’s were similar to those of the 1970’s, but these were several technical improvements and a couple of significant policy shifts.

• A report6 was prepared in 1981 that set policies for the development of long range plans and block plans7 for the following decade.

• The Sustained Yield Unit for planning became the “region” (Northwest Oregon comprised Astoria, Tillamook, and Forest Grove; Willamette comprised Cascade, West Oregon, and Western Lane; Southern comprised Coos and Southwest Oregon; and Eastern comprised Klamath-Lake and Eastern Oregon Districts)

4 The Classification Criteria for Land Uses on State Forests and Management Rules for Classified Areas appear to have been adopted in 1972 and included designations such as Production, Scenic Production, Scenic Conservancy, and Protective Conservancy. Areas with the Conservancy designation were officially considered “no touch” areas, but amounted to a very small portion of the landscape, perhaps five percent.

5 The “Management by Objective” methodology was part of a state-wide effort sponsored by the Executive Department.

6 State Forest General Technical Planning Decisions: Rotations, Hardwood Harvesting, Commercial Thinning, Intensive Management Priorities, and Fixed Cost Control (1981); document approved by the State Forester, Deputy State Forester, Associate State Forester, and four Assistant State Foresters.

7 Block Plans were harvest planning tools developed by each district. Each district was divided into planning “blocks” with a forester assigned to develop harvest units on Mylar sheets using ortho photos, air photos, and topographic maps. In addition to the harvest units, these sheets included existing roads and any road construction that was necessary to access the identified units. The Block Plans were supposed to include at least 10-years worth of harvest units.

o The report did not contain a formal decision for designating regions as the Sustained Yield Units; however briefing materials associated with the planning process indicated that regions produced higher sustained yields than districts.

o The region had a non-declining flow of volume over time; however, the harvest flow by district/county could fluctuate widely from decade to decade.

o Analysis and memos accompanying the Northwest and Willamette plans indicate that there was significant internal controversy regarding this policy decision.

• The OSCUR II inventory was developed for this planning process and was completed on each district prior conducting the planning.

• Growth and yield information was generated by DFSIM. The yield tables were based on nine regimes and three site indexes for Douglas-fir and western hemlock stands.

• The harvest schedule model used for these plans was called the State Forestry Department Simulated Forest Development (SFDSFD) that was developed by Bill Volker (ODF staff). This was a simulation model; not a linear program or other optimization model. New assumptions in this modeling effort include:

o Recognition of inoperable areas, such as roads, streams, and the various “conservancy” areas. Acreage deductions for roads were about four percent, streams about one to two percent, and a general operational reduction of one to four percent, as determined by each district o Districts conducted an availability review where they were allowed to postpone specific harvest units identified by the SFDSFD model for one or two decades.

• The economic analysis of harvesting and young stand management activities:

o Assumed a stumpage real price appreciation of two and a half percent above inflation for 28 years o Included planting, interplanting, various types of site preparation and release, conversion of brush fields and alder stands to conifer plantations, pre-commercial thinnings, and fertilization o Considered cost, workload, discount rate, and internal rate of return o Resulted in specific guidelines for when and where to conduct these activities o Was considered a business case for conducting these activities.

• Additional economic analysis associated with these plans include district specific “marginal costs analysis”; presumably conducted to determine whether harvest revenue on each district covered district costs (these plans were developed shortly after a major recession in the early 1980’s that resulted in layoffs of State Forests staff).

• In addition to economic analysis at the forest plan level, each proposed timber sale underwent an economic feasibility analysis that resulted in it being classified as a Category 1 or 2 Sale. To be considered a Category 1 Sale, the ODF share of the revenue from the harvest must cover all sale related cost through site preparation and planting. All other timber sales were Category 2 Sales and were approved based the trend in the Forest Development Fund revenue projection.

• Except for the 1989 Willamette Plan, there is no documentation on the approval of these plans.

The 1989 Willamette Plan was approved by the State Forester, reviewed by the Board of Forestry, and approved by the State Land Board.

1991 through 1999 State Forest management underwent significant changes in the 1990’s as a result of the Endangered Species Act listing of northern spotted owls and marbled murrelets, as well as the Gubber-Grabber lawsuit. These events led to the adoption of several Oregon Administrative Rules in 1999: Greatest Permanent Value, Forest Planning, and Forest Land Management Classification.

Forest planning during this period occurred on a more ad hoc basis and only two plans were formally completed: the Eastern Oregon Region Long Range Forest Management Plan (1995) and the Elliott State Forest Management Plan and Habitat Conservation Plan (1995). The districts that were not covered by these plans tried to meet the annual harvest objectives of the previously approved plans, or identify new interim harvest objectives.

General

• Very little documentation of the planning process now exists outside of the approved plans8 themselves.

• Development of these plans included significant involvement by stakeholders, the general public, and other agencies.

• These plans were designed for a much broader audience and contained more discussion of forest resources (other than timber) than previous plans and much less analysis.

• These plans were approved by the Board of Forestry and the State Land Board, while the Elliott

HCP was approved by the US Fish and Wildlife Service.

Eastern Oregon Region Long Range Forest Management Plan

• The plan covers all BOF and CSL ownership in eastern Oregon, but focus’ on those lands on the

Klamath-Lake District (33,000 acres). The goal for the remaining 8,000 acres of CSL that were scattered across the rest of eastern Oregon were to be consolidate them with larger blocks of land through land exchanges or to de-list them with management reverting to the Department of State Lands.

• The Forest Service Pacific Northwest Stand Exam system was implemented as the district inventory prior to beginning the planning process.

• The harvest scheduling was conducting using the Prognosis stand simulation model for 210 stands of the 243 stands on the district. The remaining 33 stands were not included in the harvest schedule, because they were plantations less than six years old and no inventory information was available for them.

• Harvest outputs were specified for six decades:

8 Some documentation exists regarding the development of the strategies for the Northwest and Southwest Oregon State Forests Management Plans approved in 2001.

o Area (acres) were used to control the rate of harvest and an anticipated volume was reported (i.e. within a decade, the annual harvest acres would be approximately the same, but the volume could fluctuate).

o Decade to decade harvest acres and volumes were not even flow. Harvest declined for the first three-decades, from about 9 MMBF per year for the first decade to about 6 MMBF per year in the third decade9. The anticipated harvest increases to about 10 MMBF by the sixth decade.

• The plan does not contain any economic analysis of the economic viability of the plan or analysis of reforestation and young stand management activities. There was some analysis prior to starting the planning process on the viability of even-aged versus uneven-aged management strategies.

Elliott State Forest Management Plan and Habitat Conservation Plan

• An approved forest management plan was never printed; only the 1993 draft is available. The approved HCP was printed. The draft plan contains an analysis of seven management alternative; alternative six was the basis for the approved plan.

• The Sustained Yield Unit for the plan was the Elliott State Forest; the scattered parcels on the Coos District were not included in the plan.

• The OSCUR II inventory was the basis for the yield tables; similar stands were grouped into regimes, but the plan does not specify the number of regimes.

• Yield tables were created using DFSIM and the Stand Projection System (SPS)10. It is not clear, but DFSIM was probably used for the “natural” stands, while SPS was probably used for the plantations.

• The SFDSFD simulator was used to project forest development and harvest over time.

o The analysis excluded non-productive areas such as roads, riparian zones, unloggable and non-commercial areas for the harvest opportunity pool.

o An availability review was conducted on the outputs of SFDSFD, as well as for intensive management opportunities such as thinning and intensive management.

o The SFDSFD analysis considered clearcuts only; the thinning objective in the plan was based on a separate analysis conducted by the district.

o The draft forest management plan (page III-66) state that the sustained yield for the

Elliott was calculated based on volume, and contains a discussion of volume versus acres for setting the sustained yield11.

• The plan contained an economic analysis of total cost versus total revenue for the first decade of the plan.

9 Note: the third decade for Eastern Oregon Long Range Plan starts in 2016.

10 SPS is a commercial growth model developed by Dr. James D. Arney, a forestry consultant.

11 Personal communication with Norma Kline of the Coos District indicates that the harvest objective in the final plan was based on acres.

2000 through 2004 The planning process became more complex with the FMPs containing goals for multiple resources and even greater public involvement.

Northwest and Southwest Oregon State Forest Management Plans (2001)12

• The State Forester developed and recommended these plans and the Board of Forestry adopted these plans as administrative rules.

• These plans contain a vision, goals, and strategies for the districts covered by the plans, but they did not contain harvest objectives (these would be determined in the individual district implementation plans) or quantitative estimates of any management activities.

• The Sustained Yield Unit under these plans was the district and the plans were to be reviewed/revised at least every ten years

• Harvest model outputs were used by the Board of Forestry to inform their decision on FMP approval; however, the outputs from these models were not used to inform the development of the district implementation plans or set annual harvest objects.

• The Division contracted with Dr. Sessions to develop the harvest models for this project. These goal oriented models were based on heuristics to find a very good, but not necessarily the optimal, solution to the problem13. These models:

o Documentation of these plans is found in Appendix I, “Decadal Analysis of Alternatives”, of the Northwest Oregon State Forest Management Plan o Projected outputs over a 200 year horizon in 20 ten-year periods o Goals include Present Net Value, harvest volume, and stand structure o Produced outputs for annual volume harvest and stand structure development over time o Were ‘spatial models’ that could enforce spatial constraints, such as clearcut size, and report harvest activities as a GIS output o There was no field involvement in the development of these models and only limited field review of the outputs

• The growth and yield inputs for these models were derived from yield tables developed for the

C.L.A.M.S. Project14. These yield tables were applied to the State Forest OSCUR Inventory polygons.

12 The Northwest Oregon State Forest Management Plan covered Astoria, Forest Grove, Tillamook, North Cascade, West Oregon, and Western Lane Districts, while the Southwest Oregon State Forest Management Plan only covered the Southwest Oregon District.

13 See “Overview of the Harvest & Habitat Model Choices and Model Structure” by John Sessions and Pamela Overhulser for an explanation of why heuristics were chosen for these models (though this paper was written for the H&H Project, the same rationale applies to the initial models for the 2001 plan).

14 Coastal Landscape Analysis and Modeling Study (C.L.A.M.S.) based at O.S.U. had the goal of analyzing the aggregate ecological, economic, and social consequences of forest policies of different land owners in the Coast Range. Part of the study developed yield tables for the coast range using F.I.A. plots and Landsat imagery.

District Implementation Plans Each District covered by the Northwest and Southwest Oregon State Forest Management Plans developed an implementation plan that described how the forest management plan would be implemented on that district.

• The State Forester approves the implementation plans.

• These plans included estimates of management activities (harvesting, road construction, reforestation) that would occur over the next 10 year period.

• Harvest models were not developed for these plans.

• The harvest objectives in these plans was determined through a “district opportunity analysis” that is described in Appendix A of each of the 2003 District Implementation Plans:

o The analysis consisted of a six step process that relied almost entirely on the professional judgment of district staff.

o Annual harvest objectives were defined as a range of acres for four categories: conifer clearcut, conifer partial cut, hardwood clearcut, and hardwood partial cut.

o Annual harvest volume was estimated from the acres ranges and the average harvest volume per acre for each of the harvest categories (based on the professional judgment of district staff): note – the implementation plans clearly stated that harvest acres and not volume were the objective.

• The other management activities in the implementation plans, such as road construction and reforestation, were based on district staffs’ professional judgment. These estimates were not well documented and did not include an economic analysis.

2004 through 2012 Since 2004, the Division has been continuously improving its harvest modeling based on the heuristic models developed by Dr. John Sessions. There was significant stakeholder dissatisfaction with the discrepancy between the analysis conducted for the Northwest and Southwest State Forest Management Plans and the district implementation plans that resulted in a work plan to improve the State Forests harvest modeling15. This model development started with the Harvest and Habitat Model Project16 (H&H Project) and continued through the Clatsop-Tillamook Strategies for the Achievement of the Board of Forestry Performance Measure Targets Project17 (Clatsop-Tillamook Strategies Project), and eventually led to the revision of the Northwest and Southwest State Forest Management Plans and the revision of the implementations plans for Astoria, Forest Grove, Tillamook, North Cascade, and West Oregon. Development of heuristic models for the revision of the Elliott State Forest Management Plan

15 Work Plan to Address Harvest Schedule Modeling and Sustainable Harvest Levels in the District Implementation Plans; Section 12 of the Implementation Plans for Northwest and Southwest Oregon State Forest Management Plans notebook; March 2003.

16 Harvest and Habitat Model Final Report (to the Board of Forestry); March 2006 17 The results of this project was documented in several reports to the Board of Forestry:

• Board of Forestry Agenda Item 2; Nancy Hirsch; January 9, 2008

• Board of Forestry Agenda Item 1; Mike Cafferata and Ron Zilli; November 6, 2008

• Board of Forestry Agenda Item 4; Mike Cafferata and Rob Nall; April 24, 2009 and Habitat Conservation Plan (Elliott FMP) occurred concurrently with the development of the other plans.

All of these modeling projects (H&H Project, Clatsop-Tillamook Project, and Elliott FMP) had similar characteristics and processes.

General

• There was significant field staff collaboration with model project team in the development and testing of each of the models, as well as input from stakeholders.

• Four to 14 models were developed for each district with each model representing a different management scenario (alternative) for that district.

• The models and analysis were designed for use at the strategic level (comparison of management scenarios) and the tactical level (identification of harvest and structure targets).

They were not designed to be used at an operational level (identification of specific units for harvest by year); however, when possible, operational constraints were included in the models in an effort to improve the analysis at the strategic and tactical levels.

• The model and yield table assumptions were described in the “model linkages document” for each alternative that relates each of the models rules, constraints, or assumptions to a policy, plan, administrative rule, or statute.

• The modeling and yield tables were validated through a process call the Model Solution Review (MSR) that consisted of:

o Importing the model solution for the first five-periods into GIS (ArcView or ArcMap) o The solution data imported into GIS was specific to each period and included stand structure and age across the landscape and the specific harvest locations o The harvest information included harvest type, net acres, harvest volume, gross/net value, and road construction costs o The goal of the MSR were to:

Determine that the model was functioning as intended (it was following all of the rules and that the rules were a reasonable representation of reality)

Determine whether the district could implement that harvest level for the 10-year implementation plan.

Growth and Yield

• The Division’s Stand Level Inventory (SLI) was used as the basis for the yield tables

• From 2004 through 2007, the yield tables were based on stand strata (the average of all stands in the same vegetation type); after 2007, an imputation method was applied to the forest inventory and yield tables were generated for each stand that had been measured with SLI plots

• Each strata or stand in the inventory receives a ‘grow only’ and multiple prescriptions resulting in approximately 40 management pathways for each stand

• Yield tables were developed using a hybrid process that combined YTG Tools18 and the Forest Vegetation Simulator (FVS) from the US Forest Service o YGT Tools holds the stand tables, conducts the harvest, and generates the volume and other output tables o YGT Tools uses FVS to grow the stands from period to period

• A set of yield tables were developed for each district that consisted of approximately 72 tables, with each table reporting a specific stand attribute for each prescription applied to each stand for 30 periods; these tables includes attributes such as:

o Basal area per acre before and after harvest o Trees per acre before and after harvest o Scribner volume removed by harvest (total and broken down by log diameters) o Pond value removed by harvest o Stand structure after harvest

• Scribner volume was based on 40 foot logs

• Pond values assumed no real price appreciation of logs

Harvest Models

• The Sustained Yield Unit for each model was the district and the harvest objective was annual volume harvest on an even flow basis

• The primary goals of the harvest models were annual volume, stand structure, and present net value

• Outputs were projected over a 150-year modeling horizon in 30 five-year periods

• Each model was based on extensive spatial data represent by approximately 150,000 polygons and 40 attributes (defined in a data dictionary for each alternative)

• The decision unit in each model was a logical harvest unit that may be composed of multiple polygons:

o The harvest units for all districts except Coos were developed under a contract with

Logging Engineering International, Inc.; final review and approval of these harvest units was by the district o Coos District developed their own harvest units

• All models, except those for Coos District, included a transportation system that linked each harvest unit to a mill and incorporated hauling, road maintenance, and road construction costs

18 YTG Tools (for Yield Table Generator) is a third party application developed by the consulting firm Mason, Bruce, and Girard.