B-177602, APR 20, 1973

B-177602, APR 20, 1973

DECISION HOLDING THAT PROPOSED SUBSTITUTION OF TIMBER OUTSIDE OF A TIMBER SALES CONTRACT AREA FOR TIMBER INCLUDED IN THE CONTRACT UNDER THE TERMS AND PROVISIONS OF THE SAME CONTRACT WOULD BE CONTRARY TO THE PROVISIONS OF 16 U.S.C. 476.

TO MR. SECRETARY:

REFERENCE IS MADE TO A LETTER DATED DECEMBER 1, 1972, FROM THE ASSISTANT SECRETARY, REQUESTING OUR OPINION CONCERNING THE LEGALITY OF A PROPOSED MODIFICATION TO A TIMBER SALE CONTRACT BETWEEN THE UNITED STATES FOREST SERVICE AND THE EVERETT PLYWOOD CORPORATION.

THE PROPOSED AMENDMENT IS TO CONTRACT NO. 01068-1, PART OF THE ARM SALE, WHICH INVOLVES AN ESTIMATED 7.4 MILLION BOARD FEET OF TIMBER IN THE MONTE CRISTO DISTRICT OF THE MT. BAKER NATIONAL FOREST. THE FOREST SERVICE, REGION 6, PORTLAND, OREGON, PURSUANT TO THE REQUIREMENTS OF 16 U.S.C. 476, ADVERTISED THE PROPOSED SALE IN THE BELLINGHAM HERALD, BELLINGHAM, WASHINGTON, ON DECEMBER 21, 1969. SEALED BIDS WERE RECEIVED ON JANUARY 22, 1970, AND ORAL BIDDING FOLLOWED IMMEDIATELY THEREAFTER. THE CONTRACT WAS AWARDED TO EVERETT PLYWOOD, THE HIGHEST BIDDER ON JANUARY 22, 1970.

THE RECORD INDICATES THAT TIMBER IS APPRAISED AND OFFERED FOR SALE AS IF THE NECESSARY ROADS HAD ALREADY BEEN CONSTRUCTED. AS ROAD CONSTRUCTION PROCEEDS THE TIMBER PURCHASER, WHO IS REQUIRED TO PAY FOR THE COST OF THE ROADS, IS PERMITTED TO AMORTIZE THE ESTIMATED ROAD CONSTRUCTION COSTS AGAINST THE CHARGES FOR THE TIMBER. IN THE ARM SALE, IT WAS NECESSARY FOR EVERETT PLYWOOD TO HAVE APPROPRIATE ROADS CONSTRUCTED.

SEVERE SOIL STABILIZATION PROBLEMS WERE ENCOUNTERED DURING THE ROAD CONSTRUCTION. AS A RESULT, IT WAS SUBSEQUENTLY DETERMINED BY THE FOREST SERVICE THAT THE POTENTIAL FOR ADVERSE ENVIRONMENTAL CONSEQUENCES WAS TOO GREAT TO PERMIT ROAD CONSTRUCTION TO CONTINUE. THE FOREST SERVICE ALSO CONCLUDED THAT IN TWO OF THE FOUR HARVESTING UNITS, PROPOSED METHODS OF LOGGING WOULD LIKELY RESULT IN MASSIVE MANTLE FAILURES, CAUSING SOIL AND WATERSHED DAMAGE AND MAKING REESTABLISHMENT OF THE TIMBER STAND EXTREMELY DIFFICULT.

TO PREVENT THESE POTENTIAL ADVERSE CONSEQUENCES, A MODIFICATION TO THE CONTRACT WAS PROPOSED TO EVERETT PLYWOOD WHEREBY EXISTING STUMPAGE RATES WOULD BE REDUCED AND APPROXIMATELY 3 MILLION BOARD FEET OF TIMBER WOULD BE ELIMINATED FROM THE VOLUME AVAILABLE FOR HARVEST. EVERETT, HOWEVER, REJECTED THIS OFFER UNLESS TIMBER OF COMPARABLE AMOUNT AND QUALITY FROM LANDS ADJACENT TO THE PRESENT SALE AREA WERE SUBSTITUTED FOR THE VOLUME LOST IN THE UNITS TO BE ELIMINATED BY THE AMENDMENT. THE RECORD INDICATES, HOWEVER, THAT THE NEAREST AVAILABLE TIMBER IS OUTSIDE THE LEGAL DESCRIPTION SET FORTH IN THE ADVERTISEMENT AND CONTRACT PREVIOUSLY DESCRIBED. THE QUESTION HAS THEREFORE ARISEN WHETHER, IN LIGHT OF THE PROVISIONS OF 16 U.S.C. 476, TIMBER OUTSIDE THE SALE AREA MAY BE SUBSTITUTED FOR THE VOLUME PROPOSED TO BE ELIMINATED FROM THE SALE FOR ENVIRONMENTAL REASONS.

THE ONLY APPLICABLE AUTHORITY FOR DISPOSAL OF NATIONAL FOREST TIMBER IS 16 U.S.C. 476, WHICH PROVIDES IN PERTINENT PART:

FOR THE PURPOSE OF PRESERVING THE LIVING AND GROWING TIMBER AND PROMOTING THE YOUNGER GROWTH ON NATIONAL FORESTS, THE SECRETARY OF AGRICULTURE, UNDER SUCH RULES AND REGULATIONS AS HE SHALL PRESCRIBE, MAY CAUSE TO BE DESIGNATED AND APPRAISED SO MUCH OF THE DEAD, MATURED, OR LARGE GROWTH OF TREES FOUND UPON SUCH NATIONAL FORESTS AS MAY BE COMPATIBLE WITH THE UTILIZATION OF THE FORESTS THEREON, AND MAY SELL THE SAME FOR NOT LESS THAN THE APPRAISED VALUE IN SUCH QUANTITIES TO EACH PURCHASER AS HE SHALL PRESCRIBE, TO BE USED IN THE STATE OR TERRITORY IN WHICH SUCH TIMBER RESERVATION MAY BE SITUATED, RESPECTIVELY, BUT NOT FOR EXPORT THEREFROM. BEFORE SUCH SALE SHALL TAKE PLACE NOTICE THEREOF SHALL BE GIVEN BY THE SAID SECRETARY OF AGRICULTURE FOR NOT LESS THAN THIRTY DAYS, BY PUBLICATION IN ONE OR MORE NEWSPAPERS OF GENERAL CIRCULATION, AS HE MAY DEEM NECESSARY, IN THE STATE OR TERRITORY WHERE SUCH RESERVATION EXISTS.

THE STATUTE MAKES NO PROVISION FOR THE EXCHANGE CONTEMPLATED BY THE FOREST SERVICE. WE ARE COGNIZANT OF A RECENT ORDER ISSUED BY THE UNITED STATES DISTRICT COURT, DISTRICT OF MINNESOTA, MINNESOTA PUBLIC INTEREST RESEARCH GROUP V. BUTZ. NUMBER 4-72, CIVIL ORDER 598, WHEREBY THE FOREST SERVICE WAS DIRECTED TO PROVIDE SUBSTITUTE TIMBER OUTSIDE THE SALE AREA IN A SITUATION SIMILAR TO THE INSTANT CASE. WE HAVE BEEN ADVISED, HOWEVER, THAT IN THAT CASE THE FOREST SERVICE HAS AGREED WITH THE LOGGING COMPANY TO PROVIDE ADDITIONAL TIMBER IN ACCORDANCE WITH EXISTING REGULATORY AUTHORITY APPLICABLE TO TIMBER WHICH IS DISEASED AND INFECTED AND TIMBER NOT EXCEEDING $2,000 IN AMOUNT. 36 CFR 221.24(A)(5) AND 221.6. THEREFORE, THE FOREST SERVICE, BY LETTER DATED FEBRUARY 23, 1973, TO THE COGNIZANT ASSISTANT U.S. ATTORNEY, HAS PROPOSED THAT THE DISTRICT COURT BE REQUESTED TO AMEND ITS ORDER TO STIPULATE THAT ADDITIONAL TIMBER BE PROVIDED ONLY IN ACCORDANCE WITH APPLICABLE FEDERAL LAWS AND REGULATIONS.

WE AGREE WITH THE VIEW OF YOUR REGIONAL COUNSEL AS EXPRESSED IN THE LETTER OF FEBRUARY 23, 1973, MENTIONED ABOVE, THAT THE FOREST SERVICE IS NOT AUTHORIZED TO SUBSTITUTE TIMBER OUTSIDE OF A TIMBER SALE CONTRACT AREA FOR TIMBER INCLUDED IN THE CONTRACT UNDER THE TERMS AND PROVISIONS OF THE SAME CONTRACT. THE ACT OF JUNE 4, 1897 (30 STAT. 34; 16 U.S.C. 475, 476), IS THE BASIC STATUTORY AUTHORITY FOR THE DISPOSAL OF NATIONAL FOREST TIMBER. THE STATUTE PROVIDES THAT TIMBER MUST NOT BE SOLD FOR LESS THAN THE APPRAISED VALUE, THAT PUBLIC NOTICE MUST BE GIVEN FOR NOT LESS THAN THIRTY DAYS FOR THE SALE, AND THAT THE SALE TIMBER BE SOLD TO THE HIGHEST BIDDER. THERE ARE CERTAIN EXCEPTIONS TO THE PUBLIC NOTICE REQUIREMENT AND TO THE BIDDING REQUIREMENT, AS CITED PREVIOUSLY. SEE 36 CFR 221.1, ET SEQ. NONE OF THESE EXCEPTIONS PERMITS THE SUBSTITUTION OF TIMBER FROM ANOTHER SALE AREA FOR TIMBER THAT WILL NOT BE CUT OR CANNOT BE CUT ON A PARTICULAR SALE BECAUSE OF ENVIRONMENTAL REASONS.

ACCORDINGLY, WE CONCLUDE THAT THE PROPOSED SUBSTITUTION WOULD BE CONTRARY TO THE PROVISIONS OF 16 U.S.C. 476.