Deal to trade forestland for development rights falls through

Bend Bulletin article: Land Trust pursues other Skyline Forest conservation options

WASHINGTON — A deal to trade development rights for thousands of acres of timberland northwest of Bend — dubbed the Skyline Forest — is off the table.

Fidelity National Timber Resources, which owns the land, had proposed donating 28,000 acres of the forest to the Deschutes Land Trust in exchange for the right to build about 1,000 houses within a 5,000-acre parcel currently zoned for forest use.

But the deal never gained traction in the Oregon Legislature, which needed to change existing laws to allow the swap, or in the community, said Brad Chalfant, the executive director of the land trust. “All of that was a great concept, and I think would’ve been great for conservation, but it was so complicated and frankly we got mixed signals from the state,” he said.

Now, the land trust has reverted to its original strategy: negotiating to buy as much of the land as it can afford, Chalfant said.

“Essentially, we’re back on track with the transaction we originally proposed to them,” he said. “I’m confident we can put a transaction together that is realistic and doable.”

Fidelity’s plan

The Skyline Forest parcel, also known as the Bull Springs Tree Farm, is part of 290,000 acres in Oregon that Fidelity acquired when it bought up much of the logging company Crown Pacific’s holdings in 2006.

Fidelity would like to sell much of the Skyline Forest to the trust, but it also is considering developing a portion of the parcel under existing zoning laws, said Greg Lane, Fidelity’s chief operating officer.

“The land trust has been great partner of ours from the very beginning,” Lane said.

He said Fidelity is negotiating a plan “that will enable the land trust to have the community forest on some level and also provide us with some lot sale opportunities that will generate enough revenue to justify selling the balance of the Bull Springs parcel to the trust at some kind of discounted value.”

No details of the potential sale or development were available on Tuesday. But the framework of a sale could be put together in the next three months, Lane said.

“I hope if there is a deal that can be put together there, it can be put together in the near future,” Lane said. It would take much longer to finalize a proposal, he added.

Public outreach

Outgoing state Rep. Chuck Burley, R-Bend, said the effort was targeted at producing a bill in the 2009 Legislature, but Fidelity needed to do more to garner support for the plan.

“I said, ‘Folks, you gotta start doing some public outreach if you want to get this together for next session,’” Burley said. “There were a lot of rumors and a lot of questions and that’s why I encouraged folks to do the public outreach and let people know what they’re thinking.”

Chalfant said he was disappointed the land swap never moved forward, but in retrospect, more effort should have gone to educating the public about how the swap would have worked.

“No legislator was going to introduce a bill unless the community was supportive,” Chalfant said.

Erik Kancler, the executive director of Central Oregon LandWatch, a Bend-based development watchdog group, was an early skeptic of the proposal.

“I was never really sure that that level of development would be acceptable enough to people that the deal could go forward,” Kancler said.

LandWatch believes some development, perhaps a handful of homes, can be built on the land under current regulations. But it would oppose any large-scale development effort, Kancler said.

“We would challenge applications for legal lots of record and or subdivision,” Kancler said.

Seeking funds

Meanwhile, the land trust is working to find funding to buy the Skyline Forest. It ranked high on a U.S. Forest Service list of Forest Legacy projects, but could not receive the $1.5 million it requested because Congress elected to pass a temporary federal budget that did not provide enough funds for the project, said John Henshaw, a Forest Service landowner assistance coordinator.

The land trust has requested an additional $2.5 million for next year’s budget, Chalfant said.

The trust has led efforts to preserve the land for wildlife habitat and recreation, as well as sustainable logging. If a deal can be reached, the community forest would be the first of its kind in Oregon, with operations funded through private donations and partnering with the newly formed Deschutes County Community Forest Authority to issue bonds.

Under a state law passed in 2005, the forest authority can tap into lower-cost government bonds, buy working forests and use revenue generated by regular timber harvests to repay the bond debt.

The land trust, a nonprofit organization that buys land or development rights to protect habitat, views and recreation in the Deschutes River Basin, would manage the area.

Keith Chu can be reached at 202-662-7456 or at kchu@bendbulletin.com.