Bipartisan Group Works to End Costly Tongass Forest Logging Subsidy

Published August 1, 2007

While the nation continues to be burdened with huge federal budget deficits, the U.S. Forest Service is still promoting millions of dollars in taxpayer handouts to logging companies for forest road-building projects.

The timber program in the Tongass National Forest in Alaska has been hemorrhaging money–and jobs–for years. Since 1996, timber-related employment in the Tongass has dropped from 1,560 to fewer than 200 workers. Yet the subsidies keep flowing in ever greater amounts.

The per-job subsidy has risen to more than $200,000, with the total cost since 1982 amounting to about $1 billion, according to Forest Service data and other government sources.

Forest Service Defense

The Forest Service contends that building roads in the Tongass is a necessary investment for the future of the Alaskan logging industry.

Rep. Don Young (R-AK) echoed those sentiments in 2006, saying a ban on road-building is a “one-size-fits-all approach for the Tongass without consideration of the needs of the forests and the communities and Alaskans that rely on it.”

That has fiscal and budget watchdog groups scratching their heads.

“What kind of business model are these people operating under?” asked Ryan Alexander, president of Taxpayers for Common Sense. “The taxpayer spigot needs to be shut off. Relying on government handouts for success is not something most economists or smart business owners endorse.”

A bipartisan group in Congress, allied with budget watchdogs, fiscal conservatives, sportsmen, and environmental groups, has teamed up to put an end to the practice.

Lawmakers’ Objections

Reps. Robert Andrews (D-NJ) and Steve Chabot (R-OH) said they will once again offer legislation, as an amendment to a federal spending bill, to prevent additional taxpayer money from being used to build roads in the Tonagass. A similar measure has passed twice in the past, but both times it was derailed by members of the Alaska congressional delegation.

Chabot said the 2006 legislation to stop Tongass subsidies would be “a great victory for the American taxpayer,” representing an “end [to] this egregious example of corporate welfare.”

Earlier this year Andrews observed, “The Forest Service’s plan to continue the inefficient and unprofitable timber sales program in the Tongass National Forest is a travesty. Logging in Tongass has been a perennial money-loser for decades, costing the Forest Service $25 million annually for the last 25 years.

“Not only is this program detrimental to the environment and ecosystem of the Tongass National Forest, but it is also a colossal waste of taxpayer dollars, costing them $1 billion since 1982,” Andrews continued.

Tax, Enviro Groups Allied

Fiscal hawks and environmental interest groups agree.

In a May 15, 2006 open letter to the U.S. House of Representatives, the National Taxpayers Union urged the federal government to withdraw from activities that would be more appropriately handled by private entities interacting with the communities in which they wish to do business. NTU President John Berthoud commented at the time, “For the past three decades NTU and its members have held that timber extraction efforts should be based on economic viability, not the availability of taxpayer subsidies.”

Franz Matzner, forest and public land advocate at the Natural Resources Defense Council, added, “Congressman Andrews’ and Congressman Chabot’s amendment works because it is a common-sense solution to an obvious problem. Taxpayers don’t want to spend their money and see nothing in return but clearcuts and crumbling roads in their public forests. This amendment encourages responsible management of our dollars and our environment, something everyone can agree on.”

Taxpayers have been underwriting the profits of an increasingly shrinking Alaskan logging industry for years. The forest industry in Alaska continues to dwindle, according to logging industry experts, because it is less viable than forests elsewhere. Yet the Forest Service continues to support efforts to pay for additional roads in the Tongass, while existing roads deteriorate.

In the second session of the 109th Congress, 237 House members voted to end the subsidy.

Demian Moore ([email protected]) is a senior policy analyst for Taxpayers for Common Sense, a Washington, DC-based nonprofit budget watchdog group.