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Hardwood Federation August 2020 Newsletter

From the Executive Director:  Getting Back to Whatever the DC Normal Is

Even during a worldwide pandemic, there are some things that simply do not change.  In normal years the summer season always flies by and in 2020, with most everything else turned upside down, that remains true.  It is hard to believe that Labor Day is upon us. 

Next week, Congress comes back to town after (mostly) being in their states and districts for the month of August.  As we outline below, the next round of COVID relief likely will be on the top of the fall agenda.  The clock will be also ticking on lawmakers to come together on a plan to fund the government past September 30 when the fiscal year comes to an end.  The Senate has not even begun hearings and markups on twelve (12) appropriations bills for Fiscal Year 2021, so we are probably looking at a short-term Continuing Resolution that will keep the federal government operating sometime past the November election.  

Speaking of elections, the national parties have both concluded their conventions and officially nominated their candidates for President and Vice President.  The next couple of months will certainly be interesting and action packed at the Presidential level, but also in Congressional elections.  As you know, Republicans control the U.S. Senate but are challenged this election cycle.  A total of 35 Senate seats are up in November and Republicans are in the position of defending 23 of these seats to the Democrats 12.  Current polling suggests that Democrats could make gains and even take control of the upper chamber as there are a number of very close contests around the country—six seats are in the “toss up” category.  What happens at the top of the ticket will likely dictate the outcome in a lot of these down ballot races.  

The fall months are sure to be action packed…the Hardwood Federation is ready!

 

Issues

H2B Visa Guidance – Trump Administration Issues Exception for Seasonal Forestry Business

Earlier this summer HF reported that President Trump had issued a Presidential Proclamation temporarily suspending new H1B, H2B, J1, and L1 visas and that the direct impact to the hardwood supply chain would be felt be H2B seasonal workers not being able to be used for the critical tree planting seasons, which could affect the millions of new trees.  In fiscal year 2019 the Department of Labor reports that about 11,000 visas were issued for forestry and conservation work.  After push back from numerous segments of the forestry and forest products supply chain on August 12th the Trump Administration issued guidance through the State Department that named forestry and conservation as an example of a visa exception that will be made to facilitate continued economic recovery.  The amended seasonal worker exception will allow a near full planting season and should not impact the supply chain in any noticeable way.

One of our industry’s champions, and the only forester in Congress, Rep. Bruce Westerman (R-AR, 4) wrote a great op-ed on the subject and essential nature of the forest industry, if you would like more information.  You may find this article here.

Carbon Neutrality Letter – HF Signs on to Letter Urging “Carbon Neutral” Designation

The Hardwood Federation signed onto a letter sent to President Trump last week urging his Administration to finalize the long-awaited rule package that would designate carbon emissions from forest-based biomass combustion as “carbon neutral.”  A total of 50 forestry and forest products industry associations lent their name to the communication.   The final letter may be found here. 

Unfortunately, the rule is currently held up amidst an interagency review process and remains at the Office of Management and Budget.  The issue that has not been resolved is the Department of Justice’s concern that the approach the carbon neutrality rule takes regarding emissions calculation methodology undercuts DOJ’s defense of the Affordable Clean Energy rule, which is the Trump Administration’s replacement for the Obama Administrations Clean Power Plan.  At this point, it appears that, until DOJ signs off on the package, it will remain stuck at OMB.  The Hardwood Federation team continues to work with our contacts on Capitol Hill as well as in the White House to urge a speedy resolution to this issue so that the rule will be finalized by year’s end.  However, it appears at this point that the rule will stay at OMB at least through the election and likely beyond.

Covid Relief – Hope of Negotiations Re-start as Senate Releases “Skinny” Relief Package

The House and Senate left town at the beginning of August without reaching a much-anticipated deal to provide additional financial relief to businesses, state and local governments and other entities that have been challenged by the pandemic.   Leadership in the House and Senate were in constant communication with the White House on the terms of a potential deal, but ultimately talks fell apart. 

Negotiations had been at a standstill until a couple of weeks ago when Senate leadership unveiled its “skinny” pandemic relief package totaling $500 billion in assistance.   Among its notable provisions, the bill includes:

  • A liability shield for businesses, health care operations and schools that are open or are opening during the COVID crisis. 
  • An extension of unemployment benefits that expired at the end of July.  However, the $600 weekly increase in unemployment payments would be cut in half to $300 and expire December 27, 2020.  We have heard from many of our members that the $600 bonus was serving as a disincentive for employees to return to work.
  • An extension of the Paycheck Protection Program with some modifications, most notably a lower revenue loss threshold for companies to qualify.
  • $10 billion for the U.S. Postal Service
  • Funding for schools to assist in the fall reopening.

In May, the House passed a $3 trillion package which is six times the size of the Senate’s relief measure and gives some perspective into how far apart both chambers and parties have been on the approach to Congressional pandemic relief.  In addition to disagreement over the monetary size of the next relief bill, leadership in the House and Senate have different priorities which is also creating headwinds on negations.  For Senate Majority Leader Mitch McConnell, the top priority is a liability shield for businesses, schools and health care operations to operate during the COVID crisis. For House Speaker Pelosi, it is funding for state and local governments.  

In terms of timing, our best guess is that if a deal were to come together, it will be sometime in September.   One other factor that is looming is that the federal government runs out of funding after September 30.  This deadline may lend a sense of urgency to the discussions and any government funding deal that is forged may ultimately serve as the next COVID relief package. 

The Hardwood Federation continues to advocate for the policy priorities we outlined for Congressional leadership and numerous offices on the Hill last month.   That letter may be found here. 

Trillion Trees Initiative – A Significant Step Forward with Major Corporate Backing

On Thursday August 27th more than two dozen major U.S. companies, nonprofits and local governments announced their commitment to planting 855 million trees by 2030.  This is in line with what the President announced in January with his Trillion Trees Initiative.  It is estimated that these trees will almost 2.8 million acres and will fight climate change will creating jobs in rural and low-income areas.  Some companies and entities involved are committing to physically planting trees, while others are pledging financial backing or related workforce development.  A list of those involved includes Amazon, Bank of America, Mastercard, Clif Bar, Salesforce, the Arbor Day Foundation, and the cities of Dallas, Boise and Detroit.

Tall Wood Building Codes – California Building Standards Commission Passes Code Changes

The California Building Standards Commission has passed code changes for Tall Wood Buildings and will adopt the entire series of ICC changes proposed.  California will become the fifth state to okay early adoption of the International Building code and agreed that the benefits for the state include the potential for increased market demand, alignment with wildland fire prevention and forest management goals, and improved carbon storage.  These changes will become effective in July 2021.  While this does not have much impact yet on the hardwood industry, these trends and forest products innovations are significant as the greater hardwood industry looks for ways to enter Mass Timber and Tall Wood Building markets.


Happening in the Hardwood World

An ‘80s Wood Furniture Trend is Back

“Tambour” designed furniture is back and may be the hot trend in furniture this year.  To read the article on this design aesthetic please click here.


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