Taxpayers to shoulder more for fires.

Byline: David Steves The Register-Guard

SALEM - Oregon taxpayers could find themselves picking up a bigger share of this summer's firefighting cost to protect private companies' forests.

Under a deal worked out by the Legislature in the just-concluded session, the state general fund could be tapped for up to $10 million to cover emergency firefighting measures on private lands. The new provisions won final approval last week and now await the governor's signature. They require Oregon taxpayers to pick up a portion of the cost of protecting what private forest owners view as the shared public-private values of healthy forests.

But in a session that saw the Legislature turn down funding requests for education, health care and other public services, the deal with forest owners has drawn criticism as an unjustifiable cost shift from the timber industry to taxpayers.

"For the first time, you've got taxpayers on the hook for that $10 million," said Mari Anne Gest, a lobbyist for The Wild Salmon Center, who fought unsuccessfully against the proposal. "I was outraged that the timber industry came up with this plan to shift costs for fighting fires on industrial lands from themselves to the taxpayers."

The new legislation was two years in the making, drawn up primarily by representatives of government forestry agencies and forest land owners. It represented these stakeholders' efforts to find new ways to pay for emergency fire fighting on industrial forests in an era of rising costs - the result of drier conditions and greater fire risks.

Oregon, the only state that takes out an insurance policy to cover emergency fire suppression costs on private lands, was at risk of losing that coverage in 2003. The insurance industry was reeling after the stock-market plunge and Sept. 11, and Oregon's forest-fire policy had been hit hard by big fires in 2001 and 2002.

So after the 2003 Legislature put together a stop-gap funding solution to convince its insurance carriers to continue providing the policy, House Bill 2327 was drawn up for the 2005 Legislature to consider as a new way to divide up the costs of fighting fires and putting Oregon in a position to continue to insure against catastrophic fires on industrial forests.

"The system needed to be upgraded to respond to current conditions, and that's what this bill did," said Ray Wilkeson, lobbyist for the Oregon Forest Industries Council. The solution was to make taxpayers responsible for a big slice of the cost of fighting big fires on private timberlands.

For more than a decade, this is how those forest-fire costs have been handled:

For what's called "initial response" suppression of private-forest fires started by logging crews, lightning and recreational forest users, the state had Department of Forestry crews established in districts throughout Oregon, including the Eastern Lane Forest Protection District and Western Lane Forest Protection District. These costs have been funded by fees and assessments on timber companies and forestland and lot owners, along with money from the state general fund, which pays about half the costs.

When these initial-response efforts aren't enough to prevent a major conflagration, additional crews and equipment, such as air-tankers and helicopters, are called in for "emergency suppression" measures. These costs have in recent years been borne solely by the private forestland owners themselves, through the insurance policy premium and deductible, which has been $10 million a year.

But after the tumult earlier this decade, lawmakers were convinced to come up with the following approach through HB 2327:

Funding of the "initial response" level firefighting will remain unchanged.

For the "emergency suppression" measures, the state's insurance policy will carry a higher deductible - $25 million instead of $10 million - that must be spent before the policy kicks in. The premium, paid by forestland owners, will be lowered to $1.3 million, down from the previous annual range of $2 million to $4 million.

That deductible for the first time will be paid in part from the general fund. The first $15 million of costs for emergency suppression of fires on private forests will be paid by landowners. After that, the remaining $10 million would come from the general fund - mainly personal income taxes - before the insurance carriers kick in coverage.

Wilkeson, the industry lobbyist, said that while land owners have in recent years paid virtually all the costs of fighting catastrophic fires, the principle of splitting the overall firefighting costs on private forests between taxpayers and landowners was a time-honored one, dating back to early in the 20th century.

He said this notion of "shared responsibility" made sense in part because members of the public start many of the fires that sweep across private forestland. In addition, Wilkeson said, "a lot of the values at risk from fires are public values - water quality and wildlife, primarily."

But Gest said this was the wrong time to put more burden of fighting commercial timber interests' fires on the backs of taxpayers.

Oregonians, she said, "were arguing for money for education and health care, and yet at that moment, we're handing $10 million over to the timber industry."

The legislation was approved by big majorities in both the GOP-controlled House and Democratic-controlled Senate and was part of a complicated package of budget bills negotiated by the leadership of both parties in the closing days of the session.