Those of us inside Maine’s forest products industry know there are many positive events occurring, but we also have wondered how the closure of five pulp or paper mills from 2014 to 2016 has affected public perception.
So this spring we added a question to the Critical Insights on Maine survey, a comprehensive, statewide public opinion survey of registered voters, which has been documenting the attitudes, perceptions, and preferences of Maine’s residents for more than 20 years. In April 2018, a representative sample of 619 respondents across the state were surveyed online or by phone, with a margin of sampling error of +/- 3.9 percentage points at the 95 percent confidence level.
MFPC’s question was worded exactly the same as a question University of Maine researchers asked in surveys of both statewide residents and mill town residents in 2009 for the Maine Forest and Forest Products Survey. “On a scale from 1 to 7, how important to Maine’s economy is the state’s forest products industry? (1 not at all important to 7 very important).”
In the Critical Insights poll, we were happy to see that 44 percent of residents statewide said the forest products industry is very important to the state’s economy, compared to 41.7 percent in 2009. A solid majority of 64 percent chose the top two categories (6 and 7), down from 74 percent in 2009, but still excellent.
“Wow, awesome results!! 64 percent had the highest two importance rankings!” Dr. Mindy Crandall, UMaine assistant professor of Forest Landscape Management & Economics, said in an email.
“Maine’s forests cover 89 percent of the state’s land area, with 93 percent of this acreage actively managed by private landowners and much of that accessible to the public. Sustainable forestry supports Maine’s economy, identity, and quality of life. Forests provide habitat for wildlife, offer a wide variety of recreational opportunities, help protect our air and water quality, and supply raw materials used to create products ranging from newspaper to alternative fuels.” Measures of Growth Report 2017
However, UMaine colleague, Dr. Jessica Leahy, one of the authors of the 2009 study, expressed concern about the decline in the top two categories from 74 percent in 2009, to 64 percent in 2018.
“You’re holding steady with public perception among those who say ‘very important,’ but it’s the folks in the middle who are shifting their perceptions,” Leahy emailed. “That said, these are still strong numbers, more than half of Mainers see the industry as very important to the state. However, it still seems more should be done to let people know just how important forest products are, and that the reports of the forest products industry’s death is greatly exaggerated.”
Here are some reasons why the assessment of the majority of Mainers is justified:
- On May 17, the Finance Authority of Maine approved 90 percent loan insurance on a loan totaling $944,000 by TD Bank to Maibec USA LLC, a wholly owned subsidiary of Groupe Maibec Inc., a family-owned Canadian company headquartered in Quebec, Canada. The loan will be used to purchase a feed conveyor deck and de-barker machine to bring operational efficiencies to Maibec USA’s mill operations in Masardis, helping retain 145 Maine jobs. Read more.
- Pleasant River Lumber was awarded a $4.2 million grant in April from the Maine Technology Institute (MTI) that will be used toward a $12 million expansion at Pleasant River Lumber’s mill on the Milo Road and a larger $20 million initiative between the Dover-Foxcroft location and the company’s Moose River Mill in Jackman. Pleasant River will need an additional 300,000 tons of spruce/fir to operate the line, which will help with the loss of softwood markets because of pulp mill closures. Read more.
- In February, two companies, Smartlam and LignaCLT Maine, announced they would open cross-laminated timber mills in Maine. MTI awarded a $3 million to Montana-based SmarlLam to support its plans to build a $23.5 million cross-laminated timber manufacturing plant in Maine. Smartlam said it will announce the site chosen for its plan in the next few weeks. LignaCLT plans to build a 300,000-square-foot manufacturing plant on 35 acres of the 1,400-acre site now owned by Our Katahdin LLC. Read more.
- Verso Corp., which received a $4 million MTI grant, is restarting its No. 3 machine in Jay, bringing back 120 jobs and re-establishing about 1 million tons of softwood consumption (pine, hemlock and some spruce/fir). The mill is phasing out of all printing paper production and moving toward labeling and packaging lines. The total capital cost of the project is estimated at about $17 million. Verso’s recent stock performance and capital investment announcements are very encouraging. Read more.
- Robbins Lumber in Searsmont is building a $36 million, 8.5 megawatt biomass plant, with capacity to sell about 7.5 megawatts to Central Maine Power. Read more.
- SAPPI has invested $185 million in its Skowhegan mill to upgrade to its packaging paper line and wood room. Read more.
- Catalyst is investing $56 million to convert to tissue manufacturing at its Rumford mill. Read more.
- Woodland has invested $150 million to make tissue at its Baileyville mill. Read more.
Just the investments mentioned above add up to about a half billion dollars.
Maine also is fortunate that the University of Maine has world class research and development programs for wood products. One of the most recent announcements, for example, was that Mehdi Tajvidi, an assistant professor of renewable nanomaterials at the University of Maine, has been awarded $250,000 to develop next-generation floor and wall products that utilize cellulose nanofibrils, the microscopic natural structural building units of wood that are biodegradable. Read more.
These are just some of the positive/additive events that have occurred in Maine. Overall, wood consumption is increasing and capital investments are occurring among the surviving mills. I’m also talking with many people about perspective projects in Maine. Both new entrepreneurs and existing Maine businesses are considering investments here.
I’ve often said this is not your grandfather’s forest product industry, but it may be your granddaughter’s forest products industry. As we adjust to meet challenges and explore opportunities, it’s good to know the majority of Mainers understand how important our $8.5 billion industry is to Maine’s economy.
By Walker Day, chair, Technical Committee
A meeting was held on April 25 at the Maine Forests Products Council headquarters to discuss small unmanned aerial systems (sUAS) rules and regulations. Attendance included representatives from many large landowners, mills, political entities, and the Federal Aviation Administration (FAA). Presentations from Seven Islands Land Company (SILC) personnel highlighted the potential use of sUAS technology for forest management, and the struggles that SILC has encountered thus far.
Arthur Hinaman, FAA Manager, Technical Support Branch, was very helpful and we were fortunate to have him in attendance via conference call from Washington D.C. He answered many questions about certain rules, particularly the beyond visual line of sight rule, which is the biggest obstacle for forest managers at this time. After hearing what Mr. Hinaman had to say, it was agreed that obtaining a waiver at this time may not be the best option for forest managers.
The Technical Committee was formed at the end of the meeting and will reach out to other entities such as the U.S. Forest Service to see what they are doing to combat some of the issues SILC has run into. The committee will also explore new sUAS technology as it is released to see if it is a viable option for forest managers.
The main purpose of the committee is to find a practical solution for sUAS operations in Maine’s forests. Anyone interested in joining the Technical Committee is encouraged to contact Walker Day at email@example.com.
MAINE FOREST PRODUCTS COUNCIL
2018 SUMMER GOLF TOURNAMENT
Bangor Municipal Golf Course in Bangor
July 12, 2018
Play Rain or Shine
Fee $100 per person
Includes 18 holes of golf with cart & reception
Check in 12-00 – 12:30 pm – Shotgun Start 1:00pm
Send Form and Check made out to Maine Forest Products Council to
535 Civic Center Drive
Augusta, Maine 04330
$250 Hole Sponsorship (company name advertised at hole)
$300 Banner Sponsorship (banner hung on outside marquee)
$500 Equipment Advertisers (bring in own equipment to display on course.)
$1000 Cart Sponsors (advertise company on carts, can be split @ $500 each)
$500 Reception Sponsors (sponsor the 19 Hole Reception after tournament.)
$800 Prize Sponsors (sponsor the cash prizes paid to 1st Gross and 1st Net winners)
$400 Prize Sponsors (sponsor the cash paid to 2nd Gross and 2nd Net winners)
$300 Prize Sponsors (golf Balls for 3nd Gross and 3nd Net winners)
Raffle Items Needed
Each year, the Maine Forest Products Council asks its members to select outstanding individuals from the forest products community who excel in their professions. (See previous winners). Below you’ll find the criteria and nomination form for:
Please take the time to consider those people in the forest products community who have done an exemplary job in these areas and deserve recognition for their positive impact on our industry. It is an important opportunity for us to look within our industry and provide recognition and public attention where it is due. The recipients of the awards will be honored at the Maine Forest Products Council 2017 Annual meeting awards banquet on September 17 at Sebasco Harbor Resort in Phippsburg.
Email the nomination form to Sue McCarthy or mail to MFPC, 535 Civic Center Drive, Augusta ME 04330.
- LD 1655 An Act To Update References to the United States Internal Revenue Code of 1986 Contained in the Maine Revised Statutes (tax conformity).The Taxation Committee was divided on State conformity with the recent federal tax changes. Despite the current stalemate, we think there are still areas of agreement that could be achieved between parties in a special session but it is unlikely there will be compromise on everything. For example conforming State estate tax thresholds with the federal level remains a large policy debate. Conforming to bonus depreciation, or substituting it with the Maine Capital Investment Credit, will be a big help to businesses. Without action the personal exemption is maintained in Maine, which should offset concerns about an overall rate increase to individuals. Without conformity, businesses will be burdened with having to keep “two sets of books” for federal and state purposes, and Maine’s tax system will become much more complicated and difficult to administer. This is not something that can be put off until next year.
LD 1862 An Act To Establish Municipal Cost Components for Unorganized Territory Services To Be Rendered in Fiscal Year 2018-19 (UT budget).
- LD 1844 An Act To Provide the State the Right of First Refusal for the Purchase of Certain Land on Which a Subsidy Has Been Paid. Read MFPC floor sheet.
- LD 1744 An Act To Create the Hire American Tax Credit for Businesses That Hire Residents of the United States. Read MFPC floor sheet.
- LD 1654 An Act To Protect Economic Competitiveness in Maine by Extending the End Date for Pine Tree Development Zone Benefits. The Pine Tree Zone is an important business incentive that should not be allowed to expire this year. Without the Pine Tree Zone program, the State of Maine will lack a tool that is frequently used to attract expanding businesses to the State, and will fall behind other states that have robust business attraction incentives at the state level.
After a cooling-off period, legislative leaders will discuss what comes next. It’s not anticipated a special session will be called until after the June 12 primary. The state Republican convention is going on now and the Democratic convention is May 18-20, followed by Memorial Day weekend (May 26-28). Ranked choice voting also may delay the primary vote count.
When legislators do return for a special session, it remains unclear what exactly they’re going to do. Obviously, everything is carried over and still alive, but leadership will be negotiating what they will actually consider, ranging from everything to just select matters.
One thing that might shorten a special session is that since the Legislature adjourned sine die, candidates can solicit campaign funds, but when the special session begins, the restriction on fundraising will be reinstated. The governor will have 10 days to veto any bills approved in the special session and legislators must reconvene to deal for another veto day. It’s possible a special session might not end until early July.
So we’re definitely not done yet, we still have some significant bills pending and we need your help to see this session through. When we know when the Legislature will return, we will notify you. So be on the lookout for legislative alerts because your influence can help. Our members can really make a difference at the Legislature.
There’s a lot to talk about today, including the release Thursday of the new report on the Tree Growth Tax Program, the governor’s State of the State address Tuesday, and an update on the progress of our industry’s roadmap.
But the big news is Verso’s announcement to start up its idled machine — employing 120 workers — and produce container board. This is great news and opens up markets for softwood and sawmill residuals. It’s also exciting to learn they are diversifying their production into container board products. Also exciting is the announcement by two cross laminated timber (CLT) firms this week of their intentions to build facilities in Maine. We’re making great progress in building a stronger forest economy.
I served on the committee that reviewed the Tree Growth Program and our report included answers to all the questions that the Taxation Committee gave us. Our recommendations include an understanding that this program has many pieces to it and even now there are things that assessors don’t know about the program. For example, it’s not universally known that the Maine Forest Service can provide assistance in interpreting Tree Growth management plans.
So one of our recommendations is building a best management practices manual for the program. We’re recommending that the Maine Revenue Service, Maine Forest Service, the landowner community and the Maine Municipal Association get together and develop this manual. It can be handed out to anybody involved in the program and used as a reference that can be built upon to help clarify all the rules, responsibilities and penalties. We see that as a very important outcome of the group getting together.
The group noted that the Tree Growth program is built around the the involvement of licensed professional foresters. In cases where a forester may approve a management plan that is not in compliance with the Tree Growth requirements, we think this is an issue for the professional licensing board. We seek clarification from the Attorney General’s office on who has standing in bringing a complaint to the Licensing board. Rene Noel from the Association of Consulting Foresters helped guide our discussion of this issue. The governor’s bill (LD 1599) suggested that the MFS have greater authority in dealing with Tree Growth landowner compliance, but after much discussion the group believed the current system, if uniformly administered, can identify and take action with landowners not committed to the program.
Another important factor in limiting recommended changes in the Tree Growth program is that significant changes were implemented in 2012 in an agreement with the MMA, MFPC, Maine Farm Bureau and SWOAM (now Maine Woodland Owners). These changes reflect actions taken to strengthen the program and will require more time to take effect in the annual cycling of tree growth re-certifications. More details are found in the report.
It was a good effort and we appreciate the efforts of Steve Shaler, director of UMaine’s School of Forest Resources, who chaired the committee, with assistance from Dr. Adam Daigneault, assistant professor of Forest, Conservation, and Recreation Policy.
I listened to the governor’s State of the State address Tuesday and he emphasized the property tax dollars that he said are lost with the increasing enrollment of land into land trusts. I understand his concern about conserved land, but I just don’t want people confused. There are many acres of large conservation easements in the north country. MFPC members involved in these opportunities are paying land taxes on these enrolled programs. These working forest easements reflect the balance of compensation for public value (i.e. development rights and in some cases access right) and maintaining the ongoing forest operations that produce wood and Maine jobs.
In another part of the governor’s speech, he discussed his intention to submit a Commercialization Bond package designed to incentivize business investment. We know this type of incentive is meaningful. For example, the recent allocation of bond money administered by the Maine Technology Institute (MTI) yielded projects very important to the forest industry, including the Verso expansion and proposed CLT plant by SmartLam. So we know a demand exists for these programs.
It’s important that this potential funding be based on a well-evaluated plans, but this could provide a really important tool to attract investment to Maine to both our existing businesses and to other businesses that might be thinking about relocating to Maine. The “roadmap” process, officially called the Maine Forest Economy Growth Initiative (MFEGI), is progressing well. This fall, thanks to federal support, we’ll release a report that identifies the global forest products markets in which Maine is most competitive, along with the specific actions necessary to create a more diverse forest economy while increasing our economic output. In the meantime, here are the projects underway:
- A global market analysis (target release: June 2018) to identify the current and emerging global forest products markets where Maine is likely to be most competitive. This analysis is being conducted by Indufor, a leading global forest consultant, and includes competitive benchmarking to compare Maine to other forest industry states, provinces and countries.
- A wood supply analysis is being conducted by the James W. Sewall Co., to model what species are available across the state so we can match Maine’s forest resources to the market opportunities.
- A transportation analysis to determine where infrastructure improvements are necessary in response to anticipated changes in how wood moves across our state
- Working with Innovative Natural Resource Solutions to understanding the costs and benefits of modern wood energy markets for low value wood and sawmill residuals, including Combined Heat and Power (CHP) facilities.
- Supporting the redevelopment and reutilization of idle pulp and paper mill sites, by pursuing new market opportunities, local economic development, and community goals.
- Working with Maine forest economy communities to amplify and accelerate local and regional efforts around economic diversification.
I already find myself fielding more and more calls from investors interested in the State of Maine and they’re coming from all across the country. People really are looking at our forests but they’re also comparing it to other parts of the nation and the world.
By working with communities, the industry and the university, we’re going to have some great ideas about the future forest economy. We encourage all stakeholders, including current state officials and candidates, to stay in touch with us as we go through this process.
Next week may be legislators’ last chance to relax in a session where leadership has set a blistering pace since Jan. 3. Monday is Presidents Day and it’s also school holiday week, so there’s very little on the legislative calendar. But when legislators get back to business Feb. 26, they’ll be facing a deadline that will be tough to meet. Leadership has directed committees to get all bills reported out of committee the second week in March.
The intention is that unless a bill is truly an emergency and/or has consensus and is worthy of consideration by the Legislature, then let it go. This will then allow the Legislature to focus on the big items on the agenda, including ranked choice voting; marijuana regulations; whether Maine should stay coupled to the federal tax code in light of the recent changes, and – the biggest of all – how to fund the Medicaid expansion that was approved by voters last November.
Legislators face a pretty short turnaround time – probably just three to four weeks – to sort those issues out in order to make their statutory adjournment April 18.
Our big issues, including Tree Growth Tax, are still pending. The hearing on the Tree Growth report in Taxation Thursday (see Executive Director Patrick Strauch’s column) started the process.
We’ve had some success with the bills that have been worked so far. For example, LD 1759 An Act To Rename the Coast of Maine Wildlife Management Area was unanimously voted OTP in the IFW Committee and approved in the House and Senate,
We’re engaged in a dialogue and a conversation with the ACF Committee and other stakeholders about LD 1747 Resolve, To Establish a Task Force To Examine Agricultural Issues. There’s an interest to come up with a plan to promote the blueberry industry, similar to what was done by the maple syrup task force a few years ago, but it may morph into a Maine-made labeling kind of conversation. The charge and duties of the task force, as well as its membership are being discussed by the committee right now and has yet to be voted out of committee.
There are several bills pending in the EUT Committee regarding energy issues, biomass and alternative energy sources and we don’t have a clear sense of the committee’s direction as of yet. These complex bill decisions are typically saved for consideration last as they tend to be very involved and technical, but we anticipate that they will be hammered out in the next three weeks or so.
LD 897 An Act To Authorize a General Fund Bond Issue To Encourage Efficient Biomass Thermal and Power Projects in Maine is still tabled in Appropriations, along with every other bond proposal. The revenue projections are out for January and were up, which is great. But when talking to leadership there’s no real consensus or clear understanding if there will even be a bond package, because they have to fund the Medicaid expansion and the governor has made a pledge of no new taxes and no borrowing from rainy day. Our concern is that the Appropriations Committee will sweep balances in accounts in an attempt to pay for the Medicaid expansion legislation that needs to be funded as well as whatever surplus we have in the current biennial budget (if we have one). Voters passed the Medicaid expansion with a pretty good margin. Legislators don’t want to go home and run for election taking a position that is contrary to what the voters expressed at the ballot box last November. So that’s going to be the top priority – funding that Medicaid expansion — even before bonds.
One important factor in how things go, of course, is the governor, who has made it very clear he’s not going to take a lame duck approach in his final year and intends to work diligently right up to the time a new governor is sworn in. Read BDN story on his State of the State address.
An example of that is his recent position on wind energy. He’s been a vocal critic of wind energy throughout his administration and has attempted to limit the ability for wind project expansion. On Jan. 24, Gov. LePage issued an executive order prohibiting state agencies from issuing permits “related to wind turbines” in western and coastal Maine, on coastal islands and along “significant avian migratory pathways.”
The moratorium would remain in place until a new Maine Wind Energy Advisory Commission reports on wind power’s economic impact and recommends potential regulatory changes. The task force meetings wouldn’t be public, nor would the public be invited to participate. The Conservation Law Foundation filed a legal challenge on Jan. 30th.
On Jan. 29, he introduced LD 1810, An Act To Amend the Laws Governing Expedited Permitting for Wind Energy Development. It’s similar to a bill last session, having to do with visual impacts in the expedited area. Last session he was talking about taking the visual impact to infinity and beyond, but this year’s bill just proposes taking it from eight miles to 40 miles.
The bill has been referred to the EUT Committee in the House and is pending reference in the Senate. We will participate in the public hearing when one is scheduled.
Finally, the one question everyone is asking is if the Legislature will adjourn on time. They’ve got a huge agenda. Trying to find Medicaid expansion funding alone is going to be significant. Couple that with the federal tax implications and marijuana implementation and I’d be surprised if they adjourn on time.
But then again, most of them are running for office and they can’t solicit money from the lobby or their clients for contributions to their individual campaigns or political action committees until they’re out of session. Last session when they delayed their final sine die to August, it really cost them in their fundraising efforts.
So, as with so much at the Legislature, we will just have to wait and see … and then hang on!
Reprinted with MSA permission from the February 2018 issue of The Maine Snowmobiler
That old punchline from Marshall Dodge’s Burt & I routines almost never failed to get a laugh fifty years ago, but even today like all good comedy, it’s the hint of truth in it that makes it work.
On January 24, I attended the latest of the series of planning meetings for the Katahdin Woods & Waters National Monument in East Millinocket. I had avoided them until now, but the theme was winter use, so this one was necessary because it turns out that snowmobiling is the predominate use of the monument during the winter months. It hasn’t been without its challenges, but for the most part snowmobiling is working to the point that I would hazard a guess that it could even exceed the sluggish summer visitation. That is probably thanks to the dedication and work of the local clubs who completely understand the need to get south-north. The local snowmobile community was well-represented, and as usual had a firm grasp of what was happening on the ground. The rest of the crowd was locals, some outfitters and of course the usual suspects from the environmental community.
Following planning guidelines, we were split into seven small groups with an assignment to come up with lists of activities, benefits and roadblocks to achieving usage goals. The almost immediate comments were directed at the lack of facilities and lack of access in the wintertime. A lack of cabins for overnight trekkers and toilet facilities was noted.
By the design of the donors, snowmobile use is limited on the west side of the East Branch, which is too bad. As it turns out, snowmobiling is important to the trail system, and at the same time it is an important method of access to a variety of non-motorized use. Due to the location and absence of roads that were transferred to the feds, those who wish to engage in non-motorized activities in many areas of the monument are faced with trekking by foot up to 6-8 miles before they get to where they want to start. One older woman in our group kept talking about the importance of “quiet areas” and “dark skies,” but acknowledged that there was really no way to get to those “special” places.
Which brings us back to snowmobiles. Opening up more areas to snowmobiling would obviously increase non-motorized activities for other users. Heck, maybe some enterprising outfitters could even offer snowmobile rides into the back country like they do at Baxter State Park.
I thought I was quite clever suggesting that KWWNM could adopt the same snowmobile use policy as Acadia National Park. That is any road that is open to motorized traffic in the summer and is unplowed in the winter is open to snowmobiles. It works very well at Acadia and at KWWNM it would open up the Loop Road and significantly increase access to the areas people want to visit. When all the groups reported back at the end of the evening, I was pleased to learn that the six other groups had also come to the same conclusions. I guess that means I wasn’t so creative after all, but then again, great minds think alike.
The only thing holding this back is the ill-conceived deed restrictions put in place by the donors (which I think the Park Service could deal with), and the prostrations of the environmental groups, which if the truth be known, don’t really want people to enjoy the outdoors anyway.
So, that’s my story for this month. I may even go back to another planning session. In the meantime you can weigh in too. The planning process will be going on for several more months, and all are welcome to submit comments to the planning group. Their contact info can be found at https://www.nps.gov/kaww/getinvolved/planning.htm.
ORONO — The composition of hardwood forests in the northeastern United States is changing significantly. In the past 30 years in forestlands in four states, climate-associated changes have increased the abundance of American beech compared to three other hardwood species commonly associated with the regional forests, according to University of Maine-led research team.
The significant shift to forests dominated by American beech, Fagus grandifolia, in Maine, New Hampshire, New York and Vermont is associated with higher temperatures and precipitation, according to Arun Bose and Aaron Weiskittel at UMaine, and Robert Wagner at Purdue University, the team that conducted the study — one of the first to examine broad-scale changes over a long period of time in the northeastern United States and southeastern Canada.
The change from beech-maple-birch forests to more beech-dominated forestlands could have consequences for ecosystem structure and function, say the researchers. Beech is associated with a widespread bark disease and is known to limit natural regeneration of other species. In addition, the wood has less commercial value.
The significant increase in beech in the past three decades also has resulted in decreased incidence of sugar maple, red maple and birch. Factors in the changing forest composition include the ability of beech to shade out the other species.
“Our results emphasize the need for management strategies, such as higher intensity harvesting methods, vegetation control and limiting browsing pressure to reduce beech dominance,” according to the researchers, who published their findings in the Journal of Applied Ecology.
The researchers used U.S. Forest Service Forest Inventory and Analysis data, 1983–2014, for Maine, New Hampshire, New York and Vermont to study the occurrence and abundance of American beech, sugar and red maple, and birch saplings. Their assessment included sapling encroachment into new areas, as well as the abundance of the American beech relative to the other three species.
They found the beech-dominated forests particularly evident in the Adirondack Mountains of New York, the Green Mountains of Vermont and the White Mountains of New Hampshire.
Climate-associated changes in forest composition often include high mortality in sensitive species and disproportionate favoring of others that can better adapt to the new conditions, the researchers note. In the northeastern U.S., beech sapling presence and abundance has likely been driven by additional factors, including the long absence of wildfire and clear cutting, and species characteristics, such as shade tolerance.
Forest management needs to include large-scale harvesting and canopy opening to preclude beech-dominated forests from developing in even greater areas, according to the researchers.