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Hardwood Federation September 2020 Newsletter

From the Executive Director:  The West is Burning and Help is Hopefully on the Way

Unfortunately, uncontrolled wildfire events out West have become about as predictable as the changing seasons each year.  And, as unusual a year as 2020 has been, that trend continues with historic fires ravaging California and Oregon, sending smoke plumes that are now seen as far away as Europe.  Here in Washington, D.C. the sunsets even became eerie with sunlight filtering through a patina of smoke, lending an ominous quality to otherwise beautiful September weather.   Also, as predictable as these events have become is the subsequent focus on potential solutions to prevent wildfire and the inevitable discussion of the need for more forest management.  It is disappointing that it takes a tragedy and loss of life and property to drive this discussion, but at least there is bipartisan recognition that removing hazardous fuel loads and thinning overstocked stands on federal forests could help the situation.  

This bipartisan recognition was on full display in mid-September at a Senate Energy and Natural Resources Committee hearing to discuss the Emergency Wildfire and Public Safety Act (S. 4431).  This bill is the product of months of work between the staffs of Sen. Steve Daines (R-MT) and Sen. Dianne Feinstein (D-CA).  The Hardwood Federation met with the staff developing this bill well over a year ago.  The legislation takes a dual approach to forest management in that it includes both a supply and a demand component.  On the supply side, S. 4431 equips the U.S. Forest Service with additional tools to execute much needed forest thinning projects and landscape restoration work on federal lands.  For example, one provision creates a new categorical exclusion from the National Environmental Protection Act (NEPA) for the removal of dead and dying trees.  In addition, the bill would free the Forest Service of a court-imposed requirement from 2015 (known as the Cottonwood Decision) that it consult again with the Fish and Wildlife Service on land management plans whenever new information emerges about potential effects — a requirement that brought objections from both the Obama and Trump administrations because these repetitive consultations are time consuming and exhaust staff resources.  In her opening remarks at the hearing, Sen. Feinstein implored her colleagues that “We can’t sit here and do nothing.” 

On the demand side, the proposal authorizes $100 million in grants, loans and loan guarantees for the siting and development near federal forest lands of “biomass conversion facilities,” defined in the bill as a facility that turns biomass into heat, power, advanced biofuels and/or biobased products.   Inclusion of this language is a recognition that it is currently uneconomical to transport forest biomass to existing facilities that can use it—which are typically hundreds of miles from federal forest lands.

In a similar vein, Senator Martha McSally (R-AZ), who is in a tight reelection campaign, introduced the Forest Health and Biomass Energy Act.  This bill also attempts to address the demand side of the forest health crisis by incentivizing biomass energy development as a method to reduce hazardous fuel build-up in fire-prone forests.  She had this to say in conjunction with the Senate Energy hearing on the wildfire issues:  

“One of the biggest challenges we’ve had in forest restoration in Arizona is the crushing expense of removing low-value biomass like branches, slash, and undergrowth from the forest.  That’s why this week I’m introducing my bill, the Forest Health and Biomass Energy Act. My bill will accelerate forest restoration by reducing the cost and regulatory barriers to clearing out dangerous overgrowth and utilizing that material for carbon neutral biomass electricity. My bill complements the forest management policies included in the Emergency Wildfire and Public Safety Act, which I’ve cosponsored with Senator Daines and we’re considering in the hearing today. Together, our bills offer practical, cost-effective solutions to target the real root causes of these catastrophic wildfires while also supporting low carbon energy.”

Among other things, McSally’s legislation would direct the Administration to assess the biomass energy fuel potential in U.S. forests with a focus on identifying the most viable sources for energy use such as ladder fuels and by-products of forest restoration including branches, slash and other low-value biomass.  It would also establish a fund using a percentage of timber sale revenues to assist timber operators and biomass energy producers with the collection, harvesting and transportation of biomass material out of high hazard areas.

Currently, it is unclear where any of these proposals are headed.   Congress is in town only through September and then back in their states and districts through October and past the November 3rd election.  The House and Senate still need to approve a measure to keep the government funded past the end of the fiscal year (September 30).  Indications are that this measure will fund government operations through December 18, which sets up a lame duck session of Congress where the wildfire crisis and forest management provisions may be addressed.  The Hardwood Federation has been monitoring these proposals and others very closely and weighing in with our thoughts and support when opportunities are available.


Issues

Government Funding – Congress has Passed a CR to Keep the Government Open…for at Least a Little While

On September 22nd, after weeks of negotiating up to the last minutes, the House of Representatives approved a Continuing Resolution (CR) to fund the government through December 11th by a vote of 359-57, with 56 Republicans voting against it and one Democrat voting present.  This was followed by a bipartisan 84-10 passage vote in the Senate on September 31st that then sent the bill to the President’s desk.  The President did indeed sign the bill on Thursday October 1st, but due to funding running out on Sept. 30th the government did have a brief lapse, but was not technically shutdown as the Office of Management and Budget (OMB) never ordered a cease in operations.

The bill mostly pushes key legislation and programs until next year, but does extend surface transportation programs by an entire year and also contains a $13.6 billion transfer from the general fund to the Highway Trust Fund to continue highway and mass transit improvements.  However, any further infrastructure action is unlikely in this Congress.

Forest Incentives Program Act - New Legislation Promoting Wood Building Material Construction Introduced

Senators Jeanne Shaheen (D-NH) and Shelley Moore Capito (R-WV) have introduced the Forest Incentives Program Act.  The bill has two main components.  The first is more supply oriented in that it would provide private forest landowners financial incentives to conduct sustainable forest management on their forest lands.  More relevant to Hardwood Federation members is the demand side component which relates to wood in commercial construction.  The Shaheen-Capito measure would allow commercial building owners to be eligible to receive financial incentives for using biological products, such as wood, as structural materials instead of more energy-intensive materials in newly constructed and renovated non-residential buildings.  The lead agency for administering the financial incentive program would be the U.S. Department of Agriculture, which will determine which projects meet eligibility requirements and will award payments at the completion of a building’s construction or renovation.

This bill is at least the second proposal introduced this Congress that seeks to encourage use of wood building materials due to their proven carbon sequestering capability.  The other is the Trillion Trees Act introduced earlier this year by Rep. Bruce Westerman (R-AR-4).  That legislation calls for a commercial and residential sustainable building tax credit for builders that that use wood.   The Hardwood Federation is actively supporting both these proposals.  While they will not move this year, the bills serve as useful vehicles for the wood products sector to communicate about the many positive environmental, aesthetic and energy efficiency benefits of building with wood.   Both these proposals will be reintroduced in the 117th Congress, which begins in January. 

Covid Package Update – Slim Hopes as House Set to Pass Latest Covid Effort

The House of Representatives is set to pass yet another version of a pandemic relief bill with a vote expected October 1st.  On Monday September 28th, House leaders unveiled legislation that is similar to the $3trillion package that passed the House in May.  This latest bill is pared down somewhat at $2.2 trillion and includes many provisions we have seen such as an extension of the $600 expanded unemployment insurance, an additional round of $1,200 tax rebate checks, more money for small businesses through the Paycheck Protection Program (PPP) and aid to state and local governments.  The proposal was rolled out largely in response to complaints by moderate House Democrats in tight reelection races that were looking to demonstrate action on substantive pandemic relief.  It also contains $1 billion for FEMA firefighter funding to address wildfires in the West.  The bill should pass largely on a party-line vote and may serve to jump start negotiations with the White House on Covid relief.  The House is expected to leave town after the vote and will be on call for the month of October in the event that a deal does come together with the Administration on a pandemic relief plan. 

Administration Ban on WeChat – The Proposed Ban has been Held Up, but Could Still Interrupt International Communication

When the Trump Administration first announced their intention to ban use of the app WeChat (and less importantly to the everyday working interests of the hardwood industry, TikTok) alarm bells were raised from the international business community, including those in the hardwood industry.  The American Hardwood Export Council (AHEC) made HF aware that WeChat is the lifeline communication method with the Chinese and that many U.S. exporters have come to rely on the app to directly reach their Chinese customers, agents, and sales staff and as a source for valuable market intelligence.

A Trump Administration Executive Order in early August announcing the ban within 45 days was quickly made frontpage news with more questions than answers and became the focus of numerous legal challenges.  At first glance it seems that WeChat was being caught up in a greater flurry of national security issues and human rights issues that were consequentially effecting manufacturing operations with heavy emphasis on Chinese and American relations.  The original Executive Order provided almost no detail on scope, guidance, or means of enforcement and the Department of Commerce was not providing much, if any, information about the direction they were planning to take. 

This lack of information continued through Sept. 17th when the Administration announced that the ban would take effect in full on that coming Sunday September 20th.  The announcement declared that use of the WeChat application in the U.S. would be severely restricted with prohibition focused on business-to-business transactions such as:

  • Any financial transactions or payment processing services on WeChat within the United States;
  • Distribution or updates of WeChat on any online marketplace or mobile app store within the United States;
  • Provision of key services (including Internet hosting, Internet transit or content delivery services) allowing the WeChat app to function within the United States;
  • The notice explicitly excludes employee or contractor compensation and WeChat exchanges of personal or business information, as well as activities covered under contracts, licenses or permits granted before the August executive order.
  • The notice does reserve the ability to expand the list in the future to include any other transactions related to WeChat (or any other U.S.-jurisdiction property owned by parent company WeChat).

At the last minute on Saturday September 19th U.S. Magistrate (U.S. District Court for the Northern District of California) Judge Laurel Beeler issued a preliminary injunction against the ban saying it trampled on the free-speech rights of millions of Chinese-speaking Americans and that the government provided insufficient evidence of a security threat.  Since then the Trump Administration has asked the Judge to stay the injunction and said it would submit classified information supporting its motion, but no such stay has been granted yet.  The Hardwood Federation is a part of the National Association of Manufacturer’s China Task Force and continues to monitor developments of this and other Trade related issues.

Trucking Pilot Programs – FMSCA Announces Exploration of Two New Pilot Programs

The Federal Motor Carrier Safety Administration (FMSCA) of the Department of Transportation (DoT) announced in mid-September two pilot programs modeled on the previous DRIVE Safe Act to explore the impacts of hours of service and under-21 commercial drivers.

The first Split Duty Period pilot program would allow drivers one off-duty break of at least 30 minutes and no more than 3 hours, which would place a pause on the driver’s 14 hr. driving window, so long as the driver takes a 10 consecutive hour off-duty period at the end of that shift window.  The program would be limited to a certain number of Commercial Driver’s License (CDL) holders and would operate for a period of 3 years or less, in order to gather statistical evidence on the safety and ultimate feasibility of existing house of service rules.

The second proposed program would allow a limited number of young drivers (18-20 years of age) to operate commercial motor vehicles (CMV), if they already hole a CDL, across state lines.  Drivers would be allowed to operate in this program if they fall into two categories:

  1. 18-20 year-old CDL holders who operate in interstate commerce while taking part in a 120 hr. probationary period and a subsequent 280 hr. probationary period under an apprenticeship program established by an employer.
  2. 19-20 year-old commercial drivers who have operated CMV’s in intrastate commerce for a minimum of one year and 25,000 miles.

You may find the notice requesting public comments for the programs here and you may provide comments here through November 9th, 2020.

Endangered Species Act Reform – Sen. Barrasso Drops Bill Supported by HF

On Wednesday September 16th Sen. John Barrasso (R-WY) Chairman of the Senate Environment and Public Works (EPW) Committee introduced the latest version of a potential reform effort for the Endangered Species Act (ESA).  The 116-page bill, which would reauthorize ESA for the first time since 1992, would elevate the role of states, increase transparency in the implementation of the law, and provide regulatory certainty to promote recovery activities.  Sen. Barrasso said the following regarding the need to update ESA:

“It is past time to modernize the Endangered Species Act. The status-quo is not acceptable.  Species that go on the endangered species list seem to stay there forever and never recover to the point of coming off the list. My bill promotes the recovery of species and will allow local economies to thrive. State and local experts need to be leading efforts to protect local wildlife. This legislation will increase local input and improve transparency in the listing process. It protects endangered species and helps communities invest in more conservation and recovery activities.”

The Hardwood Federation submitted a letter of support of Sen. Barrasso’s efforts that would be included in the record for the EPW hearing on the Act on September 23rd.

Apprenticeship Legislation – Bill Passes House Committee

On Sept. 24th, the House Education and Labor Committee marked up and passed H.R. 8294, the National Apprenticeship Act of 2020.   The bill seeks to expand apprenticeships with the following provisions-- 

  • H.R. 8294 codifies and streamlines standards for Registered Apprenticeship, youth apprenticeship, and pre-apprenticeship programs.  This will make it easier for both apprentices and employers to participate in apprenticeship programs, while ensuring that all programs maintain the quality standards and worker protections that are essential to their success.
  • The bill permanently codifies the Department of Labor’s (DOL) Office of Apprenticeship, and directs the office to convene industry leaders, labor organizations, educators, and others to expand apprenticeships into new occupations and sectors.  According to the Harvard Business Review, there are at least 47 occupations – that have traditionally required a four-year degree – that would benefit from creating new apprenticeship programs in addition to the 1,200 occupations that are already in place and apprentice-able.
  • The measure invests more than $3.5 billion in the national apprenticeship system over the next five years. 

Access to skilled workers is a challenge for the entire manufacturing sector and the Hardwood Federation team is monitoring this legislation and other proposals in Congress that support apprenticeships and Career and Technical Education (CTE).

Presidential Campaign Reach Out – HF Has Sent Letters Outlining our 2021 Priorities to Both Campaigns

The Hardwood Federation Board of Directors recently sent a letter outlining hardwood industry priorities for 2021 to both the Trump and Biden Campaigns.  These documents will also serve as a starting point for building our 2021 legislative agenda for the 117th Congress which will be seated in January.  You may view the letter sent to the Trump campaign here and the letter to the Biden Campaign here.


Happening in the Hardwood World

HF is still “Out and About”

The nature of Association meetings may have changed significantly in the last 6 months, but the Hardwood Federation is still showing our faces, whether it be on Zoom or (safely) in-person, where allowed.  Recently HF participated in the NHLA On Demand Conference & Exhibition, presenting to a group of almost 100 live onlookers, as well as attending the AHMI Fall Conference in Roanoke, WV.  Both of these events were tremendously well run and we thank both the NHLA and AHMI for the opportunities. 

Here’s to seeing more and more of you on the Association circuit – however that may be – as we finish 2020 and start 2021!

New FRA Wood Supply Chain Graphic

The Forest Resources Association (FRA) has debuted an informative and good-looking Wood Supply Chain graphic that effectively represents the forest industry and all that we do.

A link to the supply chain graphic can be found here.

Paper & Packaging YouTube Documentary on Industry and Stewardship

A great representation of the paper industry and how fiber moves from sustainable forest material to the products you know and love.  The full video may be found here.

“Carpenters Wow Public with Medieval Techniques at Notre Dame”

After the devastating fire in April 2019, it was wondered if the renowned Notre Dame Cathedral in Paris could possibly be restored to its original grandeur and magnificence.  The final answer is still to be determined, but not for the lack of imagination and production exhibited by the scores of architects, carpenters, and historians working towards that goal.  The techniques demonstrated by these teams stay true to those that would have been employed centuries ago, including raising by hand 3-ton oak trusses.  You may read about the magnificent project here.


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