What is Skyline Forest?
Who owns Skyline Forest?
What does the landowner intend to do with Skyline?
Can the Forest be developed?
What is a Community Forest?
As a Community Forest would the Land Trust pay property taxes?
What is a working forest?
What is a Community Forest Authority (CFA)?
Will Deschutes County tax payers bear the burden of this CFA?
What happens if there is a default?
Who will own these working forest?
Will these bonds be available for purchase by the general public?
Is there any chance that Skyline Forest could be donated to the Land Trust?
Who is US Forest Capital LLC?
What is a TIMO?
Are there enough trees to pay the cost of purchasing the lands?
What is "sustainable forestry" and what does it mean? 
 

What is Skyline Forest?

It’s a 33,000 acre tree farm west of Bend and south of Tumalo that has historically been known as the Bull Springs Tree Farm.  The property has been a commercial tree farm for roughly 80 years and contains low elevation deer winter range as well as the foothills of the Cascades.  The name “Skyline Forest” refers to the Land Trust’s vision for Bull Springs as a Community Forest that is managed for the long-term benefit of our local communities. 

Who owns Skyline Forest?  

The property was previously owned by a large timber company called Crown Pacific, which transferred the land to its creditors when Crown Pacific was dissolved by a federal bankruptcy court in December of 2004.  The creditors set up a holding company called Cascade Timberlands. Cascade Timberlands continues to own the forest, but in the spring of 2006, control of Cascade shifted to Fidelity National Financial of Jacksonville, FL. The current manager of the property is Olympic Resource Management. 

What does the landowner intend to do with Skyline?

Fidelity National Financial has told the Land Trust it intends to develop a portion of the land (~1,500 acres) and if they can get landuse approval they would donate 28,000 acres to the Land Trust to manage as a Community Forest.

Can the Forest be developed?

Current state and county landuse regulations severly limit the type and amount of development today. However, landuse regulations can and likely will change over time and once Skyline Forest is broken up it would be nearly impossible to put it back together. The landowner's proposed development would require approval by the state legislature and county. 

What is a Community Forest?  

Community Forest is a term that refers to timberlands that are held by or on behalf of a local community and which are typically managed for wildlife, recreation, scenery and sustainably managed timber production. 

As a Community Forest, would the Land Trust pay property taxes?  

Yes, the Land Trust has committed to the Deschutes County Commissioners that the land would stay on the tax rolls.  

What is a working forest?

Working forest is a term that refers to forests that are actively managed for timber production.  

What is a Community Forest Authority (CFA)?

CFAs are quasi-municipal corporations that can be established by counties and cities in Oregon to issue tax-exempt bonds for the purpose of funding the purchase of working forests.  State law specifies how a CFA works and the limitations of its authority.  

Will Deschutes County tax payers bear the burden of this CFA? 

No, any bonds would be repaid with revenues from the sustainable harvest of timber.  

What happens if there is a default?  

Any transaction and subsequent bond issue will have to face scrutiny under federal law from both bond counsel and of course investors. This insures that only sound transactions are funded through such bond issues.  However, should a default take place, investors would look first to reserve funds, insurance proceeds and then to the asset, in this case the timberland. 

Who will own these working forests? 

The Community Forest legislation requires that these private working forests be held by private non-profit organizations specifically set up to hold and manage this type of land.  The CFA cannot hold the land, but would issue the bonds and loan the proceeds to the non-profit to purchase and operate the Community Forest. Assuming that the CFA is used to help fund the purchase of Skyline Forest, the Land Trust would likely create a subsidiary of the Land Trust to hold and manage Skyline as a Community Forest.

Will these bonds be available for purchase by the general public? 

Probably not. Typically, these types of municipal bonds issued in very large denominations. Typical purchasers include pension funds and other large institutional investors.  

If there is a chance that Skyline Forest will be donated, why raise funds?

At this time, the Land Trust is not raising funds for the actual cost of purchasing the forest. However, the Land Trust has and continues to incur substantial costs in pursing the acquisition of Skyline Forest. Additionally , should the Forest be fully donated, the Land Trust will still need to raise funds for its long-term stewardship, public access and educational use.   

Who is US Forest Capital LLC?  

US Forest Capital is a private company based in Portland, Oregon, with extensive expertise in assembling large forest transactions with a conservation objective.  US Forest Capital has been retained by the Land Trust to coordinate the effort to purchase and conserve the Bull Springs Tree Farm as Skyline Forest. For more information visit www.usforestcapital.com

What is a TIMO?  

The acronym “TIMO” stands for Timber Investment Management Organization.  TIMO’s differ in their size, area of operations and mode of operations. However, they typically are defined as being privately held companies or partnerships that purchase large blocks of private timberland with the goal of maximizing their investment return over a relatively short period of time (often 10 to 15 years).

During much of the 20th Century, private timberlands were typically owned by timber companies that harvested timber over an extended period of time to maintain a stable supply of logs for their mills.  In the past decade, Wall Street investors have often viewed these timberlands as under performing assets, which could deliver a much higher return if timber was harvested more quickly and the land then sold or developed for other purposes (mining, residential development, etc.).  In the past 10 years, roughly half of the nation’s private timberlands have changed ownership, with much of this land being acquired by TIMO’s responding to these higher expectations for return on investment.

Are there enough trees to pay the cost of purchasing the lands? 

No, we don't believe that the timberland can support the full cost of purchase.  The full purchase would come from a combination of the municipal forest bonds, state & federal conservation funding programs and both conventional and non-conventional charitable fundraising.

What is “sustainable forestry” and what does it mean?   

The term “sustainable forestry” generally refers to an actively managed forest, in which timber or other resources are harvested at a rate or level that can be sustained indefinitely by the land.  Various organizations and systems have been developed internationally to encourage and support “sustainable forestry” and the Land Trust will explore the most appropriate standards and partners for Skyline Forest. The Land Trust would seek to enhance wildlife habitat, protect scenic views and provide public recreation while maintaining an appropriate and sustainable forestry program.