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An end to Hurwitz saga at Pacific Lumber

June 12, 2008, Houston Chronicle
COMMENTARY

By LOREN STEFFY

http://www.chron.com/disp/story.mpl/business/steffy/5834680.html

Charles Hurwitz and environmentalists agree.

You read that right. After two decades of bitter feuding, the war of the redwoods appears to be ending the only way it could: with Hurwitz's exit from the timber business.

Last week, a bankruptcy judge in Corpus Christi indicated he favors a reorganization plan for Pacific Lumber that would transfer ownership from Houston-based Maxxam Corp., which Hurwitz controls, to Mendocino Redwood Co., a timber company based in Ukiah, Calif.

Environmentalists favor the plan because Mendocino, owned by the billionaire Fisher family that founded the Gap retail chain, has a history of enviro-friendly logging practices. Hurwitz favors it because it preserves Pacific Lumber and its 300 jobs in the company town of Scotia, Calif.

"It's a fantastic company," Hurwitz said of Palco, as the company is known. "The guys at Mendocino are good people."

Bondholders could still derail the deal, but it appears Mendocino will prevail, paying $580 million for Palco and its 210,000 acres of redwood timberland.

Mendocino's advantages

So how does Mendocino hope to make the deal work when Maxxam couldn't?

It has a few advantages. It's a private company, so it can take a longer-term view of profitability without worrying about delivering quarterly numbers to investors.

"That's a luxury public companies don't have," Mendocino Chairman Sandy Dean said.

Second, the bankruptcy process has eliminated about $600 million in debt, easing the pressure on Palco's profit margin.

Personification of doom

Most importantly, though, Mendocino doesn't have Hurwitz.

For two decades, Hurwitz has been the personification of environmental doom painted by a legion of activists in northern California.

Nothing he did, including agreeing to some of the most arduous environmental restrictions ever imposed on a timber company, could appease them. As long as they had Hurwitz, they had someone to vilify.

Hurwitz, for his part, didn't recognize until it was too late how the environmentalists could disrupt his business. By then, both sides were stuck.

Maxxam in the 1980s wasn't a long-term investor. It used junk bond financing to take over an undervalued lumber company. The playbook for such deals called for restructuring the company and selling it a few years later.

By the time Hurwitz was ready to sell, he had a full-blown war on his hands, and no one wanted to buy into it.

As part of the 1999 agreement that set aside thousands of acres of old-growth redwoods as a preserve, Hurwitz agreed to reduce Palco's timber harvest, but it didn't matter. As long as trees were cut in his name, the environmental groups kept up the fight.

That left Palco cutting far less timber than the deal allowed and unable to make enough money to pay its debt.

Mendocino claims it can make money while cutting less than a third of what's permitted under the 1999 pact.

Few companies, of course, ever truly win the support of environmentalists. Despite its sustainable logging efforts, Mendocino, too, has been the target of protests and "tree sits," and even a campaign to boycott Gap stores in the past. Nevertheless, its logging practices are less aggressive than Palco's under Hurwitz.

Perhaps Mendocino learned from Palco's plight. It has been conducting a series of meetings in California's Humboldt County, explaining its plan. It's an openness that Maxxam never had.

Ironically, though, the success of the plan environmentalists favor hinged on Maxxam itself. In bankruptcy cases, secured creditors typically rule.

It's unusual that Judge Richard Schmidt didn't simply allow bondholders to sell timberland to the highest bidder and recover the money they're owed.

Mendocino's plan gained traction after Maxxam backed it.

"It was gracious of Maxxam to support our plan," Dean said. "Their support helped improve our plan significantly."

Not a victory

The plan is far from a victory for Maxxam. It loses control of Palco, its investment withered away by two decades of timber wars. If it had to give up control, though, the Mendocino plan offers the best option for preserving Palco, which Hurwitz said was important to him.

Maxxam, which wasn't in bankruptcy itself, is left with some real estate properties and its Houston horse-racing track.

For environmentalists, the plan offers hope that a company they've long despised will change its practices, striking a balance between environmentalism and capitalism.

Perhaps it's only fitting, then, that in this, the denouement to the timber wars, they and Hurwitz finally agree.

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Another Link is Saved in the Redwoods to the Sea Park on the North Coast

Redwoods league buys Mattole land for BLM

John Driscoll/The Eureka Times-Standard
6/08/2008

http://www.times-standard.com/ci_9520620

The Save-the-Redwoods League has acquired 216-acres between Humboldt Redwoods State Park and the King Range National Conservation Area and transferred it to the U.S. Bureau of Land Management.

The property is the latest addition to a project known as Corridor from the Redwoods to the Sea. That is nearly 10,000 acres connecting the lush old-growth redwood forests in the Southern Humboldt County park to the ocean.

”In the BLM Arcata Field Office we share Save-the-Redwoods League's vision to connect critical wildlife areas in California,” said Field Manager Lynda Roush. “This land transfer is a significant stepping stone in extending the Corridor from the Redwoods to the Sea.”

The acquired land connects habitat and provides protection for threatened species in the area, according to a league press release. Endangered coho salmon and steelhead trout exist in several streams on the property, the league said, and second-growth redwoods and Douglas fir forests protect the Mattole River from soil erosion and improve habitat for aquatic species.

The land was bought from a family for about $200,000 with funding from the league and the Resource Legacy Fund Foundation's Preserving Wild California Program, league Executive Director Ruskin Hartley said in a phone interview. Hartley said the league has been working in the Mattole River area since at least 1999, initially buying some property from Eel River Sawmills. He said it's been important since large parcels in the Mattole are becoming more scarce, and the effects on wildlife and streams have been dramatic.

”The league's Corridor from the Redwoods to the Sea project is significant because virtually all of the remaining wild land in the lower 48 states is divided into isolated islands,” Hartley said. “Linking areas of wildlands is key to effective conservation. It allows us to protect landscapes where animals and plant species can thrive, reproduce and flourish.”

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Newhall Ranch Owner Goes Bankrupt;
One of two largest land owners in L.A. County

CalPERS-backed LandSource files for Chapter 11
From L.A. Times Staff and Wire Reports

June 10, 2008

A California real estate partnership that the California Public Employees' Retirement System poured about $1 billion into has filed for Chapter 11 bankruptcy protection.

LandSource Communities Development's assets include 15,000 acres of undeveloped land in the Santa Clarita Valley, among the largest land deals to falter amid the national housing glut. The land was appraised at $2.6 billion at the time of the CalPERS investment, but has dropped considerably in value since then.

CalPERS, the nation's biggest pension fund, provides pension, healthcare and other retirement services for about 1.5 million public employees. CalPERS did not immediately return calls Monday. Last month, its president, Rob Feckner, told the Los Angeles Times he hoped to forestall a bankruptcy filing but stressed that "if we incur any losses, they will be minor" because the pension fund is "very well diversified, in good shape."

LandSource issued a news release late Sunday to announce its filing in U.S. Bankruptcy Court in Delaware.

Santa Clarita-based LandSource had been trying for months to restructure a $1.24-billion debt, the company said. It received a default notice on April 22 after missing a payment when a decline in the assessed value of that northern Los Angeles County land holding triggered an additional charge.

"LandSource believes Chapter 11 provides the most effective means for the partnership to preserve the values of its business . . . while it works with creditors to achieve a long-term restructuring," spokeswoman Tamara Taylor said in the release.

Attempts to reach Taylor and LandSource were unsuccessful.

LandSource operates in California, Arizona, Florida, New Jersey, Nevada and Texas.

The partnership announced that it had received a $135-million line of credit from a group of lenders led by Barclays Bank, allowing it to fund operations during the Chapter 11 period.

CalPERS, with $254.8 billion in assets, is involved in LandSource through its participation in MW Housing Partners, an investment fund managed by MacFarlane Partners.

MW Housing Partners acquired 68% of the Santa Clarita property, along the Interstate 5 corridor 30 miles north of Los Angeles, from home builder Lennar Corp. and LNR Property Corp., a unit of Cerberus Capital Management.

Lennar and LNR each maintained a 16% interest in LandSource.
---------------

a comment on the Times' website reveal more:

http://latimesblogs.latimes.com/laland/2008/06/bankruptcy-for.html

About 2 weeks ago, Standard & Poors reported that LandSource, Newhall Land's parent company, had $25 Million in cash left in their bank accounts. Standard & Poors had conducted a 'private audit' of LandSource's financial condition at the request of LandSource's mortgage lender, Barclays Bank. So the $25Million cash was real, not funny money.

Yet, in filing Chapter 11, LandSource and Newhall Land chose to royally scr*w all of their California trade creditors by not paying them, even though that $25 Million is cash was available. Now, these local companies are unlikely to ever be paid.

Adding insult to injury, LandSource and their mortgage lender have done a prepackaged Debtor In Possession financing, which is scheduled to be approved at 10AM on Tuesday 6/10, without any meaningful notice to the unsecured California trade creditors, since the bankruptcy was filed in Delaware even though the vast majority of the assets, and all the major unsecured creditors, are in California.

Showing their contempt for their unsecured creditors, LandSource also had the nerve to create a creditors notice website at www.kccllc.net/landsource and purport to provide copies of all of the bankruptcy petitions for the 21 entities, BUT they conveniently left off the most important bankruptcy petition, the one for the parent company LandSource Communities Development LLC.

So the California unsecured creditors who were stiffed should be asking "Where did the last $25 Million go?" From the unsecured creditors schedules on the actual bankruptcy petitions, here are just some of the local companies stiffed by LandSource:

PCL Construction, Glendale, $6,060,480
Park West Landscape, Pacoima $1,245,062
Oak Ridge Landscape, North Hills $`,056,303
Hunsaker & Assoc., Valencia $905,156
Psomas & Assoc., Santa Clarita $816,033
John Burgeson Contractors, Canyon Country $800,157
RC Becker & Sons, Santa Clarita $800,151

There are many more local service providers and contractors from Ventura County, Orange County and LA County south of Mulholland also cheated out of what was due them, while the $25 Million was frittered away, or horded to pay Newhall Land's generous employee payroll and benefit package. See the schedules to the bankruptcy petitions at the website established by LandSource at http://kccllc.net/landsource

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More Details of Pacific Lumber Deal:

Marathon-Mendocino plan confirmed

by John Blakeley
Jun-9-2008

http://www.thedeal.com/servlet/ContentServer?cid=1212755507222&pagename=TheDeal%2FNWStArticle&c=TDDArticle

After weeks of contested confirmation hearings in the Pacific Lumber Co. bankruptcy, a Texas judge has confirmed a reorganization plan led by hedge fund Marathon Structured Finance Fund LP.

Marathon and Mendocino Redwood Co. LLC, a lumber distributor owned by Gap Inc. founder Donald Fisher, will pay at least $580 million cash for the 210,000 acres of timberlands owned by Palco affiliate Scotia Pacific Co. LLC

Judge Richard Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi confirmed the plan in a Friday, June 6, order, cramming down objections from the only other plan proponent remaining in the case, Bank of New York Trust Co. NA.

In a 119-page opinion, Schmidt estimated the timberlands, Palco's main asset, to be worth no more than $510 million.

BNY, the indenture trustee for $713.8 million in notes issued by Scopac and secured by Palco's timberlands, must therefore be paid at least $510 million through Marathon's plan, according to Schmidt's order.

In its plan, BNY proposed selling Palco's timberlands and lumber mill through one or more bankruptcy auctions. Schmidt, however, seemed concerned about the plan's impact on the town of Scotia, Calif., which Palco owns, and neighboring communities.

"If confirmed, the mill would likely be shut down and liquidated, along with the town of Scotia and the debtors' remaining assets, resulting in a loss of jobs for the community and a way of life in the town of Scotia," Schmidt said in his opinion. "The noteholders were not required to propose a plan that reorganized the timberlands and the milling operations. It was no secret, however, that the citizens of California and the vast majority of creditors wanted a solution that preserves the operation of both Scopac and Palco debtors."

Under Marathon's plan, Mendocino, which operates more than 220,000 acres of timberlands in California's Mendocino and Sonoma counties, will take over Palco's commercial timberland and saw mill operations. In his opinion, Schmidt called Mendocino "an experienced, environmentally responsible operator with a proven track record."

Prepetition lender Marathon, which provided Palco a $75 million debtor-in-possession loan during the bankruptcy, will split the debtors into two reorganized corporations: one which would own and operate the 210,000 acres of timberlands and Palco's lumber mill, and one which would own the town of Scotia.

Marathon will pay Scopac's noteholders $510 million, and use at least $7.5 million of its investment to improve Palco's mill, according to the Chapter 11 plan. The New York hedge fund will also convert some $160 million in pre- and postpetition debt into equity.

Unsecured creditors will be paid through a litigation trust, for which Marathon is contributing $500,000. The official committee of unsecured creditors supported Marathon's plan.

Marathon's plan does not contemplate an exit financing facility, though Schmidt left room for approval of such a facility in his order should Marathon solicit postpetition financing.

Palco, which filed for Chapter 11 with Scopac and four other affiliates on Jan. 18, had filed its own plan.

Its plan also anticipated the sale of the redwoods, but Palco abandoned the plan in favor of Marathon's after Schmidt made it clear that it couldn't be confirmed over objections from several creditor classes.

Palco, which is a unit of Maxxam Inc., cited enhanced regulatory restrictions on its timber harvesting operations that cut into revenue when it filed for Chapter 11.

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Texas Judge Kicks Maxxam Out of Humboldt County!!

Dear readers,

Friday, June 6, 2008--This morning's decision by a Texas bankruptcy court judge to hand the 200,000 acres of Pacific Lumber's Humboldt County forests over to a creditor's group led by the Mendocino Redwood Company means that Californians will be running our largest remaining privately-owned redwood forests. Mendocino Redwood co. is the largest timberland owner in Mendocino County, having acquired those lands a decade ago. Over a month ago, Charles Hurwitz's Maxxam corporation dropped their own bankruptcy reorganization plan and agreed to accept $2.5 million in exchange for supporting the plan backed by Mendo. Redwoods Co.

Maxxam has profited over the last 20 years to the tune of between $1.5 to $4 billion from clearcutting ancient redwood groves, depending on which news account you read. Thousands of people have joined in civil disobedience and tree-sits to halt Maxxam's "liquidation logging", which has not only decimated the local economy by using up the natural resources too fast, but also wrecked the company itself.

There's a big parallel here with the energy crisis faced by Californians in 2001, in which multi-national power companies PG & E and Edison International sold off most of the state's electrical power plants to Texas based power firms, which faked a power shortage and jacked up rates, leaving the price-controlled local subsidiaries of PG & E and Edison bankrupt. The only reason the local power companies were bankrupt is because they had transferred several billions from the sales of their power plants to their parent companies, and could not absorb the impacts of the electricity deregulation law that they wrote and shepherded through the state legislature in 1996. The parent companies didn't go bankrupt, however, and kept all these billions of dollars, while the local ratepayers and taxpayers got screwed and had to take the entire burden of keeping the local power system in business.

So while Maxxam is not running Pacific Lumber anymore, what the bankruptcy case doesn't resolve is where did all the billions of dollars from Charles Hurwitz's 20 year disastrous reign go?

--the editor, Rex Frankel

Map of Mendocino Redwood Company holdings in Mendocino County--in Brown.
Note--the other major private owner, Hawthorne Timber which is shown in dark blue, sold their northern-most 50,000 acre holding to the Redwood Forests Foundation last year.

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Dear EPIC Alert List members!

After 23 long years of fighting Maxxam's destructive policies in Humboldt, we can finally wave goodbye to Charles Hurwitz. Please take a minute to read the press release below, that we sent out to media earlier today.

The Mendocino Redwood Company will assume control of Pacific Lumber. While the bankruptcy judge hasn't ruled yet, he did indicate his intention to confirm the MRC/Marathon Reorganization plan.

This is a better time than ever for people to engage in local issues. Even with Hurwitz and the extreme liquidation logging practices of Maxxam's PL out of the picture, we face extraordinary challenges to ensure a healthy environment and stable economy for future generations.

EPIC would like to invite you to get involved!

The opportunity is ripe this summer to rekindle a movement in Humboldt to protect our natural legacy.

Thanks for all of your continued support!

~the EPIC team

To get more involved with EPIC projects, please contact Kerul Dyer at epic@ wildcalifornia.org or call 707.822.7711. To make a secure online donation, go to "support" at our website at http://wildcalifornia.org/. We need your support!

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For Immediate Release: June 6, 2008

For Further Information:
EPIC Sam Johnston 415-377-0415
Sierra Club Paul Mason 916-557-1100 x120, Cell 916-214-1382

A New Era in Humboldt County:
Mendocino Redwood Company to Assume Control of Pacific Lumber

Humboldt County, CA – Ending a 23-year drama, Texas bankruptcy Judge Richard S. Schmidt will announce that he favors a sustainable and economically viable plan for north coast forests formerly held by now-bankrupt Pacific Lumber Company.

Judge Schmidt’s ruling for bankrupt Pacific Lumber Company and its 220,000 acres of Humboldt County forests, expected to be filed later today, represents real progress for the region, environmental groups say.

After the ruling is filed, within a few weeks the Mendocino Redwood Company will take over Pacific Lumber operations, including logging on lands now held by the Scotia Pacific Company and the Pacific Lumber mill in Scotia. The Environmental Protection Information Center and the Sierra Club have battled Pacific Lumber’s destructive logging practices since Texas-based Maxxam Corp took over the timber company 23 years ago.

“At long last, Maxxam is gone,” said Sam Johnston, Private Lands Campaigner for EPIC. “This marks a new era for both the people and forests of Humboldt County.”

“This is a positive development for the forested watersheds and people of Humboldt County,” said Paul Mason with the Sierra Club. “We look forward to working with a company that has a much stronger track record of responsible management than its predecessor.”

To protect the ongoing health of the local community, the local economy, and the working forests of this region, Sierra Club and EPIC hope to see: 1) no more cutting of old growth, (2) recovery of species habitat, (3) use of selection harvest methods (4) permanent maintenance of timberland, and (5) permanent protection for key resource areas, such as the Marbled
Murrelet Conservation Areas.

Sierra Club and EPIC are optimistic that Mendocino Redwood Company can meet these challenges and recover this important area, according to Johnston.

“MRC inherits a landscape that has suffered grievously from more than two decades of serious abuse,” said EPIC’s Johnston. “We appreciate MRC’s background in restoration-focused forestry, and want to work with MRC to build a truly sustainable timber company for the long term. MRC needs to make dramatic changes from Pacific Lumber’s practices to fulfill the
commitments they have made.”

One of the first tasks MRC will face will be to deal with destructive PL logging plans already in the pipeline, such as the disastrous “Railcar” logging plan to clear-cut redwoods next to Humboldt Redwoods State Park. MRC also needs to perform extensive restoration work on damaged watersheds such as Elk River, Freshwater and Bear Creek.

The decision, expected to be finalized later today, resolves vast uncertainties that had loomed heavily over the bankruptcy proceedings as creditors staked their positions about who should take over Pacific Lumber and its subsidiary, Scotia Pacific. Pacific Lumber’s abandoned plan would have subdivided and sold some 21,000 acres of prime timberlands for development. The plan by the largest secured creditors of the company, the “Noteholders,” would have entailed a risky auction that could have divided forestland and mill, or forced an inflated price resulting in
unsustainable harvest levels.

The MRC Plan comes closest to implementing the standards EPIC advocates for timber management in the Redwood Region. These standards flow from three core principles for timberland management: recovery of high-quality timberland and wildlife habitat for salmon & steelhead and other aquatic, terrestrial, and avian wildlife; recovery of an economy based on these resources and full integration of the region's human communities in these
efforts.

EPIC & Sierra Club look forward to working with MRC, and are pleased that Judge Schmidt and the bankruptcy court recognized that the MRC plan affords a solid opportunity to realize long-term, sustainable forestry.

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U.S.Congress Passes Land Conservation Tax Incentive for Family Farms and Ranches

June 2, 2008

(For more information visit http://LCSLO.org or call (805) 544-9096.)

The hotly debated Farm Bill, which Congress enacted last month with an override of the President’s veto, renews a powerful tax incentive which has helped conserve a million or more acres of farms, ranches and natural areas across the US. The incentive had expired January 1st, but is now retroactive to the beginning of the year and will last through 2009.

“The new incentives are designed to benefit family farmers and ranchers of modest income by increasing tax benefits for voluntary conservation. Tax savings can then be used to supplement incomes or enhance agricultural operations. This is a great way to help keep valuable agricultural land in production” - Brian Stark, Executive Director, Land Conservancy of San Luis Obispo County.

The renewed incentive, which applies to a landowner’s federal income tax, will:
o- Raise the deduction a donor can take for donating a voluntary conservation agreement from 30% of their income in any year to 50%;
o- Allow farmers and ranchers to deduct up to 100% of their income; and
o- Increase the number of years over which a donor can take deductions from 6 to 16 years.

Landowner donations to conservation organizations, such as The Land Conservancy of San Luis Obispo County, a local non-profit land trust, have resulted in millions of acres of working lands and natural areas being conserved for the future. Land conservation protects clean air, clean water, natural areas, local food sources, historic landscapes and scenic beauty.

Land Conservancy Conservation Director, Bob Hill states “Two recent Land Conservancy projects, a 55-acre donated easement along Graves Creek in Atascadero (2006) and another 150-acre easement donation located in the Templeton Gap (2007) are both a direct result of the initial conservation easement tax provisions. In addition, current negotiations to permanently protect 3,000 acres of ranch land adjacent to the Los Padres National Forest have weighed heavily on the extension of this incentive.”

The local Land Conservancy has protected more than 9,500 acres in San Luis Obispo County since 1984 and aims to nearly double that amount by the end of 2010. According to the Land Trust Alliance, land trusts in America have together saved more than 36 million acres from development, an area the size of New England.

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Congressman's Bill May End Mining Threat to Connection Between North L.A. County Wildlife Areas

By Stephen K. Peeples
Santa Clarita Valley Signal Online Editor
May 18, 2008 .
http://www.the-signal.com/news/article/1921/

At a news conference outside his Santa Clarita Valley office on April 25, U.S. Rep. Howard "Buck" McKeon unveiled a breakthrough agreement that could halt a nearly decade-long battle between the city of Santa Clarita and global mining company Cemex, Inc. over a planned large-scale mine in Soledad Canyon.

For the first time, Cemex is on board with new legislation that McKeon, R-Santa Clarita, has introduced that would effectively end any chance the company could mine at the Soledad Canyon site.

As it stands right now, Cemex has two, 10-year mining contracts with the federal Bureau of Land Management, and is authorized to mine up to 5 million tons of sand and gravel annually on 400 acres of land in Soledad Canyon.

The city of Santa Clarita has long opposed the mine as a scourge that would add pollution and unwanted traffic to Hwy. 14. To date, the city has spent more than $8 million fighting the plans and in February 2007, the city and Cemex announced a truce to allow all the parties work out an agreement through legislation.

The resulting bill, HR 5887, tagged the Soledad Canyon Mine Act of 2008, is McKeon's fourth attempt to reach an agreement through legislation, but it's the first bill Cemex has supported.

HR 5887 would cancel the Cemex-BLM contracts. In exchange, Cemex would be given thousands of acres of BLM-controlled land in Victorville equivalent to the value of the contracts. Cemex would then be able to sell the land to the city of Victorville and other private buyers for purposes other than mining, which would be a separate agreement between those two parties.

At the news conference, representatives from Cemex, Victorville and Santa Clarita joined McKeon to call the proposed legislation a "win-win-win."

Local delegation
HR 5887 may be a creative solution resulting from years of blood, sweat and tears, but it still needs to gain support from both of California's U.S. senators, Dianne Feinstein, D-Calif., and Barabara Boxer, D-Calif., be OK'd (or at least not opposed) by the BLM, approved in Washington by Congress, and signed into law by the president.

"We know there are many potential obstacles," McKeon conceded at the news conference. "There are lots of steps and we'll be working to be as expeditious as possible. With all the major players on board, we have a strong team to take this legislation proposal back to Washington and begin the uphill process of working it through Congress."

A week later, a contingent of city officials including Santa Clarita Mayor Bob Kellar, Councilwoman Laurie Ender, Intergovernmental Relations Officer Mike Murphy, Assistant City Manager Ken Striplin and city lobbyist Cy Jamison were in Washington, D.C. and sat in on a strategy session with McKeon's staff and Cemex reprsentatives.

"We just sat down and went through the normal things you go through when a bill is introduced, and said, ‘OK, what do we need to do in terms of getting the bill moved through the congressional legislative process?'" Murphy said.

On May 8, between votes on the floor of the House of Representatives, McKeon provided a closer look into the first steps being taken.

"The process has started," he confirmed. "I hand-delivered copies of the bill to the chairman of the Committee on Natural Resources (Nick Rayhall, D-W.Va.) and the next senior member of the committee, George Miller, D-Calif., also chairman of the Committee on Education and Labor. They gave the bill to the committee staff, and they have already jumped on it. They've contacted my office to get background on the bill and what we're trying to accomplish, and to see what they can do help us in moving it forward. I have followed back up with (Rayhall) and let him know that this is very important to me and we need to move on it as quickly as we can."

The Resources Committee could take one of a few different paths from here, McKeon said. "They could hold a hearing about the bill, they could hold a markup on the bill, or they could even try to move it under a suspension, which would mean it's a non-controversial bill and it is brought to the floor."

Quickest, easiest way
Bills moved to the floor under suspension usually pass, but need a two-thirds majority. "That would be the quickest, easiest way because you don't have to go to the Rules Committee and then bring it to the floor, where people have a chance to pick it apart and change it," McKeon said. "So (suspension) would be my first preference."

If not fast-tracked, the committee would schedule a hearing. "We would get experts from the community to testify on (the bill's behalf,) but I'm trying to speed the process by avoiding (a hearing) if we can," he said.

Along with hand-delivering HR 5887 in Washington, McKeon and his staff have sent letters to California legislators seeking co-sponsorhip of the bill, which will improve chances of its passage, and he has followed up. "I have talked with a few of them personally to ask them to co-sponsor," he said.

If the Resources Committee determines it doesn't want to consider HR 5887 as a free-standing bill, they could attach it to another bill that may be moving through the process. "That's not a real strategy, but more of an option," McKeon said. "In the House, you can't attach a non-germane item, but in the Senate, you can add anything to a bill."

McKeon is also trying to determine where the BLM - an agency of the U.S. Department of the Interior that manages more land (258 million surface acres) than any other federal agency - will stand on this round of legislation.

Ten years ago, he said, the BLM director told him in one of multiple meetings that the agency's legal counsel said the BLM could not support a bill then being proposed. The latest bill has a much better chance, plus there's now a different Interior Secretary, Dirk Kempthorne, and a different BLM director, Jim Caswell.

"I've met with the Secretary and he's been supportive to this point," McKeon said. "That doesn't mean that he would support this specific bill, but he's been supportive of our efforts, and we're hopeful that if the BLM don't support the bill at least they remain neutral and don't oppose it."

McKeon and his staff are looking to Santa Clarita officials to help rally support on the city and state levels in California, and win the backing of Sen. Feinstein, who has had reservations about previous efforts to block additional mining in and around Soledad Canyon. "Ultimately, the bill has to pass in both (the House and Senate), so it'll be very important for the city to put their efforts toward working with her," he said.

Cemex was among the issues city officials discussed with Sen. Feinstein when she visited the city last year, and she had reservations about blocking future mining in the Soledad Canyon area.

"Her concern I think first of all is the availability of aggregate in the state of California," Murphy said. "The other issue was the exchange of values and resources, and how the mechanics of that would work. Basically, under federal law, if the BLM were to sell that property outright to a buyer, a minimum of 80 percent of the proceeds of the sale would come back into the state of California for use to purchase or to enhance federal lands. So we needed to look at a strategy that in essence creates a zero sum gain for the exchange."

"(Sen. Feinstein) gave the city some recommendations, some of which they have proceeded forward with and some of which were not feasible," McKeon said. "That's why it's important for them to follow up now and let her know they have endorsed (HR 5887) and fully support it, as do the city of Victorville and Cemex."

Both McKeon and Murphy urged Santa Clarita Valley citizens to contact both Sen. Feinstein and Sen. Boxer to let them know the community is behind the latest legislative effort, with Victorville and Cemex now on board.

"We want to address issues they may view from the Senate's side, so that by the time we get the bill over there we will have resolved those issues," Murphy said.

More lobbying planned
Murphy added that city officials are planning another trip to Washington next week to follow up with members of Congress and/or their representatives, to make sure they've received McKeon's letter seeking co-sponsorship, and be available to talk about the bill and answer any questions potential sponsors may have.

Locally, Murphy said, "We're reaching out to a number of groups and organizations that have previously supported our efforts, and identifying groups or individuals we would like to have on board in support of the bill, asking them to support the measure."

The city's outreach extends beyond the Santa Clarita Valley. "If local residents have family or friends in other parts of the state or the country, they can urge them to communicate with their own members of Congress that they think the bill is a good thing," Murphy said. "The more they hear about it in Congress, the better."

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912 Acre Oak Preserve Completed in Placer County

from the California Oak Report

http://www.californiaoaks.org/html/oak_report_04-08.html

Preserving Placer County Oaks
Placer Land Trust, in partnership with the California Wildlife Foundation, COF, Emigrant Trails Greenway Trust and others, announced the completion of its largest conservation project to date, the 912 acre Garden Bar Preserve, situated along the Bear River in rural Lincoln.

Garden Bar Preserve is part of Placer County’s largest remaining contiguous oak woodlands. The conservation easement will permanently protect the property's diverse natural and agricultural values, including two miles of Bear River frontage, rangeland and oak woodlands.

"Oak woodlands make up the greatest habitat biodiversity in the foothills, including over 350 vertebrates," said Jeff Darlington, the trust's executive director. "The landowner had an interest in seeing this land continue to be open space long after they were gone."

Funding for the conservation easement and ongoing land stewardship was provided by the California Wildlife Foundation, working with partner organizations like Placer Land Trust to protect the state's rich diversity of wildlife species by acquiring, restoring, and managing sufficient habitat to sustain healthy wildlife populations over time.

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What Looks Like a River but Isn't?

A Sneak Attack on the Clean Water Act at the L.A. River by Federal Bureaucrats could Crush Efforts to Restore Urban Creeks and Rivers Throughout California and the USA. By redefining protected rivers as only ones wet and deep enough to be "navigated", a major hurdle for developers could be removed



Is the L.A. River up a creek?

If the waterway is not officially deemed to be 'navigable,' many of its tributaries could lose important protections.

By Deborah Schoch, Los Angeles Times Staff Writer
June 1, 2008

Over the years, the Los Angeles River has been redrawn, clad in concrete, tainted with chemicals, invaded by countless Hollywood car chases, dismissed as a glorified storm drain.

Now comes the latest slap. The city's river can't even float enough boats to qualify as a full-fledged navigable waterway, according to the Army Corps of Engineers.

River advocates are outraged.

"They're just wrong. That's the simple version of it. We've done kayak trips from the Valley to Long Beach a dozen times in the past 10 years," said poet and writer Lewis MacAdams, founder of Friends of the Los Angeles River.

It doesn't end there. What might seem a minor bureaucratic tweak by the Corps could have a domino effect across the river's 834-square-mile watershed, say worried environmentalists and some federal, state and local officials.

Critics say the draft decision issued by Corps regulators weakens federal water protections for many seasonal streams that feed the river. They say this could translate into more mountain development and more dirty runoff flowing through cities to the Pacific.

"Practically speaking, the March 20 decision would open up a number of tributaries and streams to the argument that the Clean Water Act doesn't apply," said David Beckman, senior attorney at the Natural Resources Defense Council.

But how is the Clean Water Act -- among the strongest federal laws guarding rivers, lakes and streams -- linked to the ability to float a boat down the Los Angeles River?

The answer is cloaked in bureaucracy and court rulings.

A 2006 U.S. Supreme Court decision weakened the power of the Clean Water Act to protect certain seasonal streams. Federal regulators who decide whether a stream is protected by the law must first find the closest navigable waterway. Then they have to decide whether the stream has any effect on that waterway.

If it doesn't, landowners may not be required to obtain certain federal permits before building homes, roads or other projects over those seasonal streams. Their plans, however, would still be subject to local zoning laws and building codes.

In a case involving the Los Angeles River, regulators determined that most of it isn't navigable in the first place. So some streams on the edges of its watershed -- most in the mountains and foothills ringing Los Angeles -- may lose some federal protection, critics say.

The local Corps officials who wrote the March 20 draft decision say they strictly followed guidelines developed after the Supreme Court decision.

"When we looked at the L.A. River, we did not find evidence of navigation" beyond the Pacific Coast Highway bridge in Long Beach, two miles north of the ocean, said Aaron Allen, the regulator who wrote the draft decision.

He stressed that the decision does not weaken any federal laws that protect the water in the river, which is fed in part by reclaimed water from sewage treatment plants. He agreed that seasonal streams far up in the watershed, however, could have less protection.

But in the face of critics' concerns, the Corps has withdrawn the navigable river decision pending further study. The results of that review are expected within days.

Col. Thomas Magness, commander of the Corps office that oversees part of the Southwest, emphasized that the Corps is working with the U.S. Environmental Protection Agency on a final decision.

He promised, "it's going to be something we can all understand and defend." He said it was "purely speculative" to conclude that designating the Los Angeles River as nonnavigable would lead to more lax development standards over streams. "I would not begin to throw in the towel and submit to that conclusion."

Any proposal to fill in or build over streams will still be reviewed on a case-by-case basis "on its own merits," he said.

Yet the Los Angeles River case is attracting interest in Washington and elsewhere in part because it's among the first in the nation after the Supreme Court decision.

"The implications of these decisions could be quite large," said David Smith, chief of wetlands regulation at the EPA southwest region, who has met twice with Corps officials while trying to change their decision.

Los Angeles River defenders such as Rep. Henry A. Waxman (D-Los Angeles) and Nancy Sutley, Mayor Antonio Villaraigosa's top environmental deputy, have written letters to federal officials, criticizing the river ruling.

"If the Corps of Engineers applies a similar approach to other rivers, protections against water pollution that are now taken for granted could be seriously eroded throughout the nation," Waxman wrote in a letter to the EPA. He said the draft decision could undercut Clean Water Act rules governing waste discharges, dredging, oil spill prevention and water quality standards in much of the Los Angeles River basin.

Meanwhile, local river enthusiasts are rushing to collect photos and videos of friends and relatives paddling on the river in canoes and kayaks.

Their goal is to prove that yes, indeed, just like the Mississippi and the Potomac, Los Angeles' river is worthy of navigation -- maybe not by cargo ships, but at least by canoes.

Web of tributaries

The drama got its start not on the river but in a far-flung web of tributaries in the Santa Susana Mountains north of Chatsworth.

There, rancher Wayne Fishback hoped to fill some seemingly dry stream beds to build a road and prevent erosion on his sweeping mountain property above Brown Canyon Wash, a tributary of the Los Angeles River. He asked for guidance from the Corps of Engineers, which regulates parts of the Clean Water Act.

Fishback's request landed on the desk of Aaron Allen, chief of the Corps' North Coast office in Ventura, who holds a UCLA doctorate in fluvial geomorphology, or how streams shape the land.

Ten years ago, Allen's job would have been easier. In those days, federal clean-water laws typically covered the seasonal streams, marshes and pools common in the arid West.

All that changed with the 2006 Supreme Court decision in which Justice Anthony Kennedy wrote that the Clean Water Act would apply to a water body if it had a "significant nexus" with "traditional navigable waters."

So Allen's review ballooned into a full-scale review of the Los Angeles River. He concluded that only 1.75 miles of the river upstream from the ocean is navigable.

The remaining 49-mile stretch -- which cuts north through southern Los Angeles County and then west into the San Fernando Valley -- did not meet the legal test of being navigable, he wrote.

"Presently, the occasional use of kayaks and/or canoes on other reaches of the river are sporadic and do not support any associated commerce," Allen wrote in the March 20 memorandum. Nor could he find evidence of historical navigation.

"Finally, the capacity to provide navigation at some point in the future is highly doubtful given the river's configuration, hydrology and fundamental use as a flood control channel."

Memo leaked

For Fishback, that was good news: His land lies so far upstream from the PCH bridge that he probably can fill four of his streams without navigating the time-consuming permit process.

But when the Corps memorandum was leaked to river advocates in April, the uproar ensued.

George Wolfe, a Venice-based kayaker who founded the satire website www.lalatimes.com, helped create a video last year featuring him commuting by kayak on the river in a business suit.

"As a boater with some 30-plus years of boating I can honestly say that it's a perfectly navigable river," he said in a letter submitted to the Corps along with the video.

Some local officials are urging the Corps to conduct its review in public.

"My agency wasn't consulted, wasn't made aware of it," said Tracy Egoscue, executive officer of the Los Angeles Regional Water Quality Control Board, who learned about the decision from the EPA and criticized the lack of citizen input.

Magness said the Corps invested countless hours in the decision and conferred with other federal, state and local officials. "By no means have we done anything without public involvement."

But for Egoscue and others, the designation reaches beyond the thicket of environmental bureaucracy.

Egoscue characterizes the Corps' decision as showing "a fundamental lack of understanding and respect for the resource to come in and make a decision without citizen involvement."

"It's not just about the law and the permits this board writes," she said. "It's about the perception of the river. . . . The Los Angeles River is our Potomac."

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Ancient Redwoods at Risk!! Caltrans is conducting an Environmental Impact Report for Highway 101-Richardson Grove widening project
--Submit your comments by June 10th, 2008!

from the Environmental Protection Information Center

Richardson Grove State Park, covering approximately 2,000 acres, stands at Humboldt County's southern gate, welcoming travelers to this side of "the Redwood Curtain." A canopy of majestic old-growth redwoods welcomes northbound travelers as they wind along the Eel River. Because the ancient redwoods squeeze the highway at several points along this curvy section of state Highway 101, interstate-size trucks are currently prohibited from traveling along this route. Caltrans has designed a project that would realign the road--putting more curves in
the road so that vehicles would come at the tight spots at less acute angles--thus opening up the County for more interstate truck traffic.

CalTrans has decided to prepare an Environmental Impact Report for the Richardson Grove widening project, as we and many others have been urging it to do over the past year and a half. It is crucial that we impress upon Caltrans how important a resource this Grove is to our community. Now that Caltrans has decided to conduct an EIR, we need to provide initial
scoping comments about what we believe the EIR must consider.


The deadline to submit scoping comments to Caltrans is June 10th. Write a letter to Caltrans today. Make specific comments. Ask specific questions. Caltrans is required to respond to your written concerns in their EIR.

Visit our webpage for points to include in your letter:

http://www.wildcalifornia.org/pages/page-271, or use the template at
http://www.wildcalifornia.org/actions/number-68 to
copy and paste into your word-processing software and print out a letter.

Please also send a copy of your letter to Congressman Mike Thompson and Governor Schwarzenegger at the addresses below. Caltrans has asked for snail-mail, rather than email.

This is the first opportunity to provide comment. When Caltrans issues the Draft EIR, which it expects to do in October 2008, we will be able to submit more detailed comments about its adequacy and the project as presented in the Draft EIR.

Call (707)822-7711 or write epic@wildcalifornia.org for more information.