ALBANY — Jurors on Wednesday found in favor of 14 western Oregon counties in a $1 billion lawsuit claiming the state deprived them of revenue for decades by limiting logging in state forests.
The jury recommended the counties receive the past and future damages they had sought — $674 million in lost revenue since 2001, and $392 million in future damages through 2069.
Clatsop County opted out of the legal challenge. The Board of Commissioners voted 3-2 in 2017 not to participate because they wanted more balanced forest management policies.
“We will not have comment until we have an opportunity to review the decision,” County Manager Don Bohn said in an email.
The Sunset Empire Park and Recreation District also opted out.
Two dozen other taxing districts in the county, including the Port of Astoria, were part of the lawsuit. The taxing districts stand to receive $176 million for past damages and $109 million for future damages.
Blair Henningsgaard, an attorney who represents the Port and the Seaside and Jewell school districts, predicted the state would appeal. “Round one is over,” he said.
Henningsgaard questioned the county commission’s vote to opt out. “They made a decision that in my opinion defies any kind of logic,” he said.
“I was told that they considered it to be a political statement, which is like having a tantrum. Clatsop County’s voice is important, but what they’re saying is we’re not going to tell you what we think ... As a lawyer, I don’t understand it.”
In a statement, the Oregon Department of Forestry said it “believes that balanced and science-based public forest management produces the best long-term outcomes for all Oregonians, including the counties and taxing districts that receive revenue from state forests.
“We are disappointed that the jury did not agree ... We will be reviewing options and next steps with attorneys from the Oregon Department of Justice.”
During the four-week trial, attorneys for the state had argued that the counties wanted to allow clearcutting of forests and did not care about endangered species.
The lawsuit was focused on three words — “greatest permanent value” — and what that meant when the phrase was written into law 80 years ago.
Lawyers for the counties say it meant maximizing revenue from logging. Attorneys for the state argue that it includes other factors such as recreation and habitat.
The law stemmed from a time decades ago when private lumber companies descended on Oregon and clearcut forests. Instead of paying taxes, the companies left counties to deal with the land in a practice known as cut and run.
The counties didn’t have the resources to restore the land. So, during his 1939 inaugural address, Gov. Charles Sprague urged the Legislature to pass a bill allowing the state to designate the land as state forests, grow back the trees and manage the land “to secure the greatest permanent value” and share revenue with the counties.
The law enabled the state to adopt about 1,000 square miles — roughly the size of Rhode Island — from 15 counties that receive 64% of the logging revenues. Clatsop County was the only county that declined to join the lawsuit.
The counties claim the state breached the contact in 1998 when it adopted a rule defining greatest permanent value to mean healthy, productive and sustainable forest ecosystems that provide a social, economic and environmental benefits to the people of Oregon.
Attorneys for the counties made it clear they want the trees treated as a commodity to be exploited.
“Timber is like a crop of wheat, except for a longer growing season, isn’t that right?” John DiLorenzo, a Portland attorney hired by the plaintiffs, asked one witness at the trial.
He also noted that smaller timber harvests mean fewer jobs in logging, milling, transportation and other services.
Scott Kaplan, an attorney for the state, declared that the counties’ vision of greatest permanent value is “turning Oregon into a tree farm from the Cascades to the Pacific.”
The counties have actually seen revenue from timber harvests increase since 1998, totaling $86 million in 2019, he said.
Witnesses at the jury trial included a history professor, retired foresters and others who have trooped into Linn County Circuit Court.
The lawsuit was initiated by the Oregon Forest & Industries Council trade group and two companies that buy timber — Hampton Tree Farms and Stimson Lumber, The Oregonian reported, citing court documents.
Mills have been closing across the state for years. In the 1970s, annual Oregon timber harvests totaled more than 8 billion board feet and employed 80,000 workers at wages 30% above the statewide average, according to the Oregon Office of Economic Analysis.
Annual harvests are now under 4 billion board feet, with direct industry employment at about 30,000 and the average wage equal to the statewide average. The biggest driver behind the decline is logging on federal lands being down nearly 90%, according to the 2017 study. Around half of Oregon is federally owned land.