The Hardwood Federation Newsletter

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Hardwood Federation May 2020 Newsletter

From the Executive Director:  To a New Normal and Beyond

June is here and it hardly seems possible.  Much of the world has been on pause for the last few months and uncertainty has been the new normal.  There are hopeful signs that we are emerging from the shadow of the COVID-19 crisis.  States are slowly re-opening businesses and recreational activities. Airlines and hotels are reporting upticks in travel reservations…small, but at least going in the right direction.  The U.S. Senate is back in town and the House is at least partially back, with a temporary proxy voting rule in place to allow vulnerable members to stay home and still participate in important decision making.  The Mayor of Washington D.C. has announced that stay at home orders for the city are suspended…at least for now.  It is unclear when we will be back in our offices on a regular basis, but until we are, Cary, Pat and I continue to work from our respective homes doing our best to keep members of the hardwood community updated on federal action that impacts businesses, employees and families. 

The fast and furious pace of relief measures passed by Congress and signed by the President has led to some confusion, well-intentioned but ill-conceived guidelines and rules, some helpful programs…and some continuing uncertainty.  Our focus in the next few months will be to ensure that any future relief programs are open to hardwood industry companies and that corrective measures do indeed solve existing issues and prevent future pain.

Thank you for the kind words that many of you have expressed for our efforts.  We also appreciate the help we have received from our fantastic member associations as they have shared our updates and calls to action with their memberships.  We have had an impact.  And our very heartfelt appreciation to those of you that have supported us financially.  We are especially grateful for your contributions during these very difficult times.  We will continue to work hard on your behalf.

Issues

Paycheck Protection Program Update

The full House is expected to pass legislation today that would make important modifications to the popular Paycheck Protection Program (PPP).   One of the challenges for many businesses accepting loans under the PPP is that the program requires funds to be spent within an 8 week timeframe.   For those businesses that are closed or not fully operational, this time limit is not tenable.  The legislation would give businesses that have secured loans under the program up to 24 weeks or December 31, 2020 (whichever is earlier) to spend the funds.   The deadline by which borrowers may apply for PPP funds is also extended under the measure to the end of this year.   Finally, the bill would also ease a requirement that at least 75 percent of PPP funds be used toward payroll.

Similar legislation awaits action in the Senate.   House and Senate leadership have signaled that there is agreement that the time frame for spending PPP funds is too short.  However, the Senate package would increase the eight-week period only to 16 weeks so negotiation between the two chambers is needed.

The action forcing variable on this issue is that small businesses that received loans shortly after the program was rolled out in early April are running up against that 8 week window in current law. 

Covid-19 Economic Relief - Cap Reduced on SBA Economic Injury Disaster Loans

Earlier this month, the Small Business Administration lowered the cap on the Economic Injury Disaster Loans (EIDL) by 90 percent—reducing the total dollar amount that may be borrowed under the program to $150,000 from $2 million.   The change was not announced publicly.  Citing overwhelming demand, the Small Business Administration has also stopped processing applications for any non-agricultural businesses as it works through its application processing backlog.

In response, Senate Minority Leader Chuck Schumer (D-NY) and Senators Jeanne Shaheen (D-NH) and Ben Cardin (D-MD), Ranking Member of the Senate Small Business Committee, sent a letter to SBA Administrator Jovita Corranza urging an immediate reversal of these policies.  That letter may be found here.

We expect that these issues raised in the letter will be addressed in any subsequent COVID relief measures Congress may take up later this summer.

Bats - Habitat Conservation Plan

Comments were submitted earlier this month by a group of forestry and forest product companies, as well as a number of forest landowning companies on the Lake States Forest Management Bat Conservation Plan, which is being developed by the Departments of Natural Resources in Wisconsin, Michigan and Minnesota.  The purpose of the HCP is to outline conservation measures to be implemented during forest management activities that will mitigate impacts on four bat species threatened by the white nose syndrome (WNS) and not by sustainable forest management. These bat species are the northern long-eared bat, the tricolored bat, the little brown bat and the Indiana bat. The HCP being developed will apply to the DNRs’ forested lands. County and private forest landowners may also opt into the HCP via a Certificate of Inclusion (COI). The COI would allow county and private land managers to continue forest management activities and remain compliant with the Endangered Species Act.

Completing the HCP in the next 18 months is critical as a recent court decision directed the U.S. Fish and Wildlife Service (USFWS) to reassess the listing status of the northern long-eared bat. It is anticipated that the USFWS will change the current “threatened” status to “endangered” following the assessment. If this occurs, an HCP would need to be in place in order for forest management operations to proceed. The Lake States HCP is being looked upon as a model for other states and regions to use once it is finalized.   

Community Wood Energy and Innovative Products Program – CWEIP Grants Announced

In April, the U.S. Forest Service announced funding awards for projects under the Community Wood Energy and Innovative Products (CWEIP) program.   This initiative was created by the 2008 Farm Bill, but it had a minimal authorization and never received appropriations.   The Hardwood Federation led efforts during the 2018 Farm Bill reauthorization effort to expand the focus of the program and provide it with meaningful funding.  As a result, CWEIP is authorized at $25 million a year and its focus is both on wood energy and on innovative wood products facilities.  

The projects listed below are the first to be funded by this newly retooled program.    As you can see, lumber mills are a central focus.   We are working the Fiscal Year 2021 appropriations process to increase the appropriations for CWEIP over what was allocated for FY 2020.

Community Wood Energy and Wood Innovations grants

Grant Recipient

City, State

Icy Straits Lumber and Milling, Inc.

Hoonah, AK

·     Establish climate-controlled working space to manufacture wood products.

Native Village of Kluti-Kaah

Copper Center, AK

·     Heat four tribal community buildings with one central system.  

Limington Lumber

East Baldwin, ME

·     Generate electricity in addition to heat for sawmill operations. 

City of Middle River Community Center

Middle River, MN

·     Heat 45,000 square-foot community center.

Iron Triangle, LLC

John Day and Seneca, OR

·     Produce process heat for forest products manufacturing operations in two locations.

Vaagen Timbers, LLC

Coleville, WA

·     Generate process heat to dry lumber for cross-laminated timber.

Washington State Department of Corrections

Olympia, WA

·     Establish district heating and hot water supply for 103,000 square-foot prison.

 

Trucking Rules – Department of Transportation Announces Changes to Hours of Service Regulations

The U.S. Department of Transportation (DoT) Federal Motor Carrier Safety Administration (FMCSA) announced a rule change on May 14 that will allow truck drivers to drive more hours under their hours of service (HOS) regulations.  Truckers driving shorter distances – modified to 150 air-miles - will be allowed to drive up to 14 hours, versus the previously allowed 12 hours.  In addition, time spent loading and unloading trucks will be counted as breaks from driving.  Under the new rules, drivers will be required to take 30 min. breaks after 8 hours of driving, rather than the previous mandatory break after 8 hours of job related tasks, such as loading and unloading.  There are also some changes to the sleeper-berth exceptions allowing drivers to split their required 10 hours off duty into two periods without counting against the drivers 14 hour driving window.

A pdf of the full rule can be found here.

Federal Forests – Legislation Introduced Combines Covid-19 Relief with Forestry Programs

Earlier in May, Senator Ron Wyden (D-OR) introduced the 21st Century Conservation Corps for Our Health and Our Jobs Act.   The multi-faceted legislation covers a number of COVID-related issues, such as funding for outfitters and guides with the U.S. Forest Service and U.S. Department of the Interior to stay afloat through the shortened recreation season.  It also includes funds for land management agencies to purchase and provide personal protective equipment (PPE) to their employees, contractors, and service workers.   Mixed within these provisions associated with the pandemic is language promoting forest management on federal forest landholdings.   One is language providing an additional $150 million for the Collaborative Forest Landscape Restoration Program, the flagship program for community forest restoration and fire risk reduction.   Another is a provision allocating $500 million for the Forest Service State and Private Forestry program, which will be divided between programs to help facilitate landscape restoration projects on state, private, and federal lands.  Also included in the bill is a permanent authorization and funding for the Land and Water Conservation Fund.    And finally, the bill authorizes $100 million for the Community Wood Energy and Wood Innovation Program, which provides grants to projects that install high efficiency wood heating systems in businesses, hospitals, schools, community centers and entire towns.   The program also incentivizes the development of innovative wood products, such as cross laminated timber and wood nanotechnology

The Hardwood Federation is following this proposal and several others that would promote sound forest management on our federal lands.   Senator Wyden’s proposal is not expected to move on its own, but provisions within the bill may move as part of a larger package later this year.  

Happening in the Hardwood World

Take the Wooden Money and Run

Made famous 90 tears ago for printing wooden money during the Great Depression, the town of Tenino, WA is back at it.  Due to the economic ravages of the coronavirus pandemic Tenino is looking to its own history and will print $10,000 worth of government-backed scrip as a relief program that can be used in the town for certain goods including groceries, gasoline, and bills.  Households can apply to receive up to $300 in the wooden currency to spend at Tenino businesses, which will later be collected ad reimbursed with real money.  The town will also use the original press to mint the currency as they did during the Depression when the town’s only bank ran out of money and the city council decided to create their own.  To read more about this clever currency click here.

Mass Timber Comes to Clemson

Be warned, this article is about Southern Yellow Pine, but its still pretty cool…  Clemson University’s recently completed 16,000 sq. foot Andy Quattlebaum Outdoor Education Center is a gorgeous achievement in mass timber and the second facility in the nation to use Southern Yellow Pine as the primary building material (Cypress was used as a secondary material).  For pictures and more details click here.

Michigan’s Standing Trees Could Nearly Wrap Around the Earth

Well, that title pretty much says it all, but for more details click here.


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