Plum Creek: Finding Gold in Maine

By Phyllis Austin, Maine Environmental News ( 6/12/02

Plum Creek proposes the largest subdivision ever in Maine’s 10 million-acre unorganized territory.

KODADJO - Orange survey tape, downed trees and numbered lot signs dot the south shore around First Roach Pond. The largest subdivision ever proposed in Maine’s 10 million-acre unorganized territory – 89 lots -- is being created by Plum Creek Timber in this relatively isolated spot known as Kokadjo.

The development sparked some controversy here but not of the intensity that Plum Creek was accustomed to in the West, where it had a dark reputation among environmentalists as an aggressive forest liquidator and lakefront subdivider. In its three-and-a-half years in Maine, Plum Creek has managed to avoid the kind of limelight that gave it a "Darth Vader" image in the past elsewhere.

Conservation Groups to File Suit over Plum Creek's Conservation Plan

June 11, 2002 Seattle, WA -- Conservationists will go to federal court to stop Plum Creek from ruining one of the last remaining bull trout populations in the West.

"Plum Creek's habitat conservation plan is based on vague promises, but offers little new or effective protection for the fish," says Chris Frissell, PhD, Senior Scientist for the Pacific Rivers Council.

Read the complete press release from the Pacific Rivers Council.

But as time goes on, it’s clear that Plum Creek is in Maine to mine its resources and maximize the dollar value out of all assets. The company is doing that by subdividing its high value lands, extensive logging and even squeezing timber competitors for tolls to travel their woods roads. While most of the public focus on Plum Creek has been on its land sales, questions have surfaced recently about its timber harvesting practices, from felling a tree with an eagle’s nest to violating cutting standards in a conservation easement area.

Plum Creek made promises to Mainers about being sensitive to special value lands on its 905,000 acres. Company officials said they had no plans to develop their prime waterfront lands here, as they had done in Montana and Idaho. Plum Creek purchased the land from SAPPI (the old S. D. Warren holdings) because it was "probably one of the best timber properties in the Northeast," said company president and chief executive officer Rick Holley in October, 1998.

From all appearances, the company intended to be a good neighbor and follow the rules as they raked in the cash. Early on, Plum Creek garnered $5.26 million by selling to the state 65 miles of undeveloped of shoreline on eastern Moosehead Lake, the West Outlet of the Kennebec River and several lake islands. Simultaneously, the Appalachian Trail Conference paid Plum Creek $1.3 million to purchase 3,000 acres on the east side of Mt. Abraham. The company soon pocketed another $10.5 million by selling 7,500 acres on the north end of Spencer Lake to media billionaire John Malone of Denver – a deal less well-received initially by the public because of concerns that he would prohibit traditional recreational access. But then Plum Creek reaped public praise again for agreeing to protect the backcountry around famed Pierce Pond from new motorized access.

After Plum Creek cut down a tree with an eagle’s nest on Spencer Pond near Kokadjo last fall, the company’s harvesting practices drew widespread criticism. The state Department of Inland Fisheries and Wildlife took the blame for it (a communications failure, they said), saving Plum Creek from looking worse than it did and staving off legislative action. The nest was in an area designated by the state as an essential wildlife habitat for eagles under Maine’s endangered species act. Eagle’s nests are protected by that designation while there are eggs or chicks in the nests and by the federal eagle protection act and the endangered species act at all times.

Montana's Swan Valley and Mission Mountains, April 1988. Plum Creek Timber Company's clearcutting.
(Photo: The Lands Council)

Bob Croce, co-owner of Spencer Pond Camps, found the nest on the ground and blew the whistle on Plum Creek. The company knew there was a nest in the vicinity and didn’t take time to locate it, he said, adding that their action reflected "a callous attitude." Croce asked Plum Creek to consider not cutting for awhile in the area to give eagles a chance to rebuild a nest. "There’s been no response," he said.

Meanwhile, another harvesting incident has been percolating in the background for a couple of years, tainting Plum Creek’s claim of good forestry. The company violated the state’s forest practices acts in the Pierce Pond watershed, which is under conservation easement protection, according to the Bureau of Parks and Lands (BPL). But BPL land acquisitions supervisor Ralph Knoll said the violations weren’t serious enough to warrant legal action, especially since Plum Creek had already initiated corrective action to repair the disturbed shoreline areas. BPL said it would prepare a memorandum of understanding for all three easement holders in the watershed. Knoll said he hasn’t had time to write the document because of other higher priorities, leaving the situation unresolved.

Except for the two harvesting cases, Plum Creek has a clean record with state regulatory agencies. However, Bill Gailbraith, head of enforcement for the Land Use Regulation Commission (LURC), noted that there hasn’t been anyone in the field in the Greenville area for some time checking for compliance.

Reflecting on Plum Creek’s record here, Cathy Johnson, North Woods Project director for the Natural Resources Council of Maine (NRCM), surmised, "They’re doing exactly what we feared – slicing and dicing the best of Maine’s North Woods into second home developments." There are plenty of rumors "about which lake is next," following the First Roach subdivision, she said, pointing to a Wall Street Journal article last November that reported Plum Creek’s intention to augment real estate sales. "Bringing in the highest short-term rate of return to their investors through developing shorefront lots – not by managing for long-term timber values – appears to be Plum Creek’s main goal," she said.

NRCM has "no confidence" that Plum Creek is managing its timberlands sustainably, Johnson said, since the company has not undergone independent third party audit of their practices by the Forest Stewardship Council, the certifier preferred by environmentalists. She said the SFI program under which Plum Creek was audited in 1999 had "inadequate standards that are insufficient to protect the forest ecosystem . . . and was done when the standards were even weaker than they are today. The report they issued," according to Johnson, "is a glossy public relations tool, not a serious report about the company’s harvest practices."

"We know that the large landowners as a group, including Plum Creek, are harvesting their lands faster than they are growing back," Johnson added. "If Plum Creek were not one of the companies that is over-harvesting, why wouldn’t they get independently certified by FSC?"

First Roach lots: sold like hotcakes

At First Roach Pond in May, black flies were biting and the signs of the coming influx of new property owners seemed to have sparked an excitement all the way down to Greenville, 30 miles south on the Lily Bay Road. All but one of the 28 lots in the first phase of the development sold in three weeks, and a half dozen of the owners had already contracted with locals to build their camps.

Locals weren’t all that surprised that the lots sold. "There’s always been demand on this pond for lots," said Fred Candeloro, who runs the Kokadjo Trading Post and Rentals and pointed to the 100 camps that have been on First Roach for years. What was surprising, however, was the speed at which they were grabbed up.

"I’ve never seen anything like this," said Luke Muzzy of Century 21 Real Estate in Greenville, which has the exclusive contract to sell the subdivision. "No one, not even Plum Creek envisioned this success," he said. The 21 south shore lots listed at $65,000 to $70,000 and six of the seven north shore lots listed at $125,000 sold without advertising. Two of the new owners have already filed applications with LURC for building permits, according to senior planner Aga Pinette.

As a result of the quick sale, Plum Creek’s MikeYeager, director of land management for the northern division, said phase two of the First Roach project (23 lakefront lots and eight back lots) will be filed soon with the LURC. Muzzy is optimistic those lots will be sold too in record time, and he has nothing but praise for Plum Creek. "They’re great to deal with . . . a first-class act." Likewise, Fred Candeloro said, "If you’re going to get some development, here, this is the way to get it. It’s in good taste," he said. "We’ll be able to retain what we have. They’re not going to do anything to spoil the view," Candeloro added, referring to restrictions on setback, tree removal and lighting, as well as conservation areas amid the development.

Yeager said that Plum Creek has no plans for another First Roach-type development. He said that while the company’s Maine land base is large, "it doesn’t have many First Roach ponds" that would be attractive for development. Yeager said Plum Creek intends to keep a promise not to subdivide land on wild ponds in its ownership.

But environmentalists aren’t taking bets, aware that Plum Creek has more than 100 lakes and ponds and significant river shoreline segments in its ownership. Anxious to stave off subdivision of more pristine places, the state has put in a $5 million request to the federal Forest Legacy program for fiscal 2003 for acquisition of possibly as much as 500,000 acres of Plum Creek’s lands between the Boundary Mountains and Nahmakanta Lake. Likely the protection would be largely in the form of conservation easements, rather than fee purchase.

In light of the land that Plum Creek has already sold here, Karin Tilberg, Maine director of the Northern Forest Alliance, said that her perception of the company is that it’s largely a real estate development company. "We’ve never been exposed to a [large] landowner ready, willing and able to develop its HBU [highest and best use] lands," she said. "We need to be careful and watch them for what they are – a business that develops land."

While Plum Creek is up front about the importance of land sales to its profits, real estate generates the third largest amount of revenues to the company, behind timber harvesting and manufacturing. For the first quarter of 2002, timber income was $157 million; manufacturing, $93 million and real estate, $23 million.

The Pierce Pond mess-up

Jym St. Pierre, Maine director of RESTORE, has been a regular critic of Plum Creek, whether on the company’s development or harvesting practices. The company’s forestry program is approved under the industry-created Sustainable Forestry Initiative (SFI), but as St. Pierre echoed Cathy Johnson, not the more reputable and rigorous FSC program.

In 1999, Plum Creek’s forest practices were examined by PricewaterhouseCoopers LLP of Seattle. The audit team found that the harvest practices, largely inherited from the previous owners, "were consistent with sustainable timber production goals." The investigators, however, found room for improvement to "avoid the possibility of future significant non-conformance."

Woodlands manager Jim Lehner said Plum Creek is "going through re-evaluation under a revised, stronger SFI program. He maintains the company is following "guidelines of sustainability." The harvesting strategy on the land has changed in the last three years to "more emphasis on growing sawlogs," he said. "We’re looking at value per acre instead of cords per acre."

St. Pierre said the reports he gets on Plum Creek’s cutting practices "are mixed." People who are neighbors of the big landowner complain about an unsightly harvest here or there away from public roads, but they also give Plum Creek credit for some state-of-the-art operations in visible areas. Being careful about what the public sees from more traveled roads has been a Plum Creek strategy out West.

One source who works with Plum Creek on various Maine projects and didn’t want to be quoted gave the company credit for trying to be more progressive and open in its timberland management than previous owners. But he said there are philosophical struggles between the holdover staff from the S. D. Warren Co. days and the newer people on the job.

"I don’t recall much press on our cutting practices," said Lehner. But the media and the public has virtually no access to meaningful data collected by the Maine Forest Service on harvesting volumes and types of cuts, such as clearcutting. The agency regards the information they gather as mostly confidential, and what is released doesn’t identify individual owners.

The Pierce Pond situation shows that Plum Creek is scouring its lands for value, cutting in more remote areas of the pond than had been done in many years. Plum Creek owns 6,800 acres on the pond (64 percent of the watershed) and knew that their operations there would be scrutinized because of the conservation easement and the prized trout fishery.

More than $1.4 million of Forest Legacy money was spent to protect the watershed, with BPL taking on the role of easement monitor. The Maine Wilderness Watershed Trust and the Valentine family each own about 1,700 acres each, and those lands are under the Legacy easement protection.

"We went into Pierce Pond knowing it was sensitive politically," said Lehner. "We worked to treat it with kid gloves . . . [but] a lot of people with an interest there look at harvesting in that watershed as bad. I think those are the folks who are upset" with Plum Creek’s operations," Lehner said.

"We were wringing our hands," he said. "Should we clearcut or not. If not, it would all blowdown and be a mess. We spent the summer before [the harvest] holding tours for the [trust]" members who wanted a look in the field," Lehner said. "A lot didn’t care for it and didn’t go out [to have a look-see]. Anyone who understands what we were doing was supportive," Lehner asserted. Others familiar with the situation said Plum Creek simply tripped up and didn’t have adequate oversight of the cutting by an outside contractor.

There were two harvest sites of concern. One was a small clearcut in the Upper Pond area that was visible, and the watershed trust made it an issue with Plum Creek and BPL. "It didn’t blend in, and they agreed," said. David Peppard, immediate past president of the trust. It was an aesthetic issue and didn’t violate any laws.

The violations occurred in the 330-foot easement zone that was established in a deal with S. D. Warren in August, 1996. BPL’s Knoll called the Forest Practices Act violations "technical – with a capital T" -- having to do with standards on how much wood must be left standing in a harvested area.

There’s not much written communication among the parties involved, but what there is indicates the strong feelings the situation has evoked. On June 18, 2001, Jim Lehner wrote to Peppard and Jerry Bley of Creative Conservation stating Plum Creek’s interest in fostering "a cooperative relationship with" the trust. "We have kept our door open and have always been available to discuss your concerns and have responded appropriately," he contended. Lehner mentioned that the company changed their harvests to address the trust’s concerns over visual impacts and wildlife; adjusted road locations and standards to address concern over increased public access; agreed to gate the roads, changed the harvest timing to cut in winter when pond users were away; created the backcountry recreational area and held tours to explain the harvests and listen to concerns.

"I am extremely concerned about the trust’s appearance of an adversarial relationship with Plum Creek," he said in the letter. "My impression is that the trust is no longer interested in continuing our cooperative approach to resolving issues." Lehner asked for a meeting "to reappraise" the relationship, and that was held in the fall of last year.

Peppard wrote Knoll a letter on April 2, 2002, expressing concern that "the alleged easement and state law violations on Plum Creek lands have not been adequately addressed. As you know I received considerable personal abuse from Plum Creek officials at that [fall] meeting," he said. "To date, no official finding of your department has been released, which leaves me hanging as to being the bad guy."

"I brought forth what I felt were legitimate violations of state law and of the Forest Legacy Easement," said Peppard. "Until the final report of the investigation of those alleged violations and your proposed MOU are made available for review, I feel this issue will continue to remain as unresolved," he said.

Recently, Peppard commended Plum Creek for improving their harvesting practices around Pierce Pond. "Since this [easement issue] came up, I’ve seen a fairly dramatic improvement in Plum Creek’s approach. At this point [the harvests] are very well laid out and carefully done," he said.

The trust wants to buy out Plum Creek’s ownership on Pierce Pond. Lehner acknowledged there have been some negotiations in the past but said, "We weren’t able to come to terms. We’re in no big rush to make changes there," he said.

Plum Creek plans to cut in the watershed every year "but less intensively after this year," Lehner said. "There was quite a big . . . good quality hardwood in there. The area hadn’t been logged for 30 years," he said. "It left us with several age classes. We’ve got a pretty darn good crop growing" for future cutting."

If there had been an egg or chick in the nest, the tree felling would have constituted "a taking"

While the Pierce Pond situation has remained mostly out of the public eye, the eagle nest case not only garnered considerable media attention but also legislative interest. Rep. Joe Brooks (D-Winterport) introduced a resolve to better protect eagles’ nests. His bill would have required that landowners check with IFW to ensure there are no eagle nests around woods to be cut. It also would have asked IFW and other resource agencies to review the effect of harvesting on endangered species.

Information came out through the nest destruction that such acts are not always protected through existing state regulations as assumed. IFW’s Mark McCollough, head of the endangered species program, said that the essential habitat law requires that any project needing a permit by a state or municipal entity must be reviewed and approved by IFW. But timber harvesting activities on private lands don’t need such approval, he pointed out, and consequently the habitat law didn’t apply. Also, the tree cutting happened in the fall after the nesting season and exposed a loophole in the state’s endangered species protection law. If there had been an egg or chick in the nest, the tree felling would have constituted "a taking" under that statute, he said.

"I never fell a tree without looking up. I can’t imagine a logger missing anything as large as an eagle nest,"

Maine Audubon Society, the Penobscot Nation, Bob Croce and independent loggers sided with the bill, but IFW, industrial landowners and the Maine Farm Bureau opposed it. Plum Creek didn’t offer testimony and its representative at the hearing wasn’t asked questions. The fish and wildlife committee killed the measure, concluding that there was no need for regulation in light of only one reported incident. However, lawmakers did pass a resolve directing IFW and the Department of Conservation to evaluate communications between the two departments and with landowners and foresters on the location of endangered species on private property.

The eagle nest incident still rankles Mike Amaral, senior endangered species biologist from the U. S. Fish and Wildlife Service (FWS) in Concord, N. H. He was not aware of the nest destruction until after the only Maine field enforcement officer for the agency had already investigated the case and decided that prosecution wasn’t warranted under federal statutes. Amaral said that FWS’s conclusion was there was no "willful or malicious intent," and that IFW shared the blame.

FWS is not going to pursue Plum Creek, he said, and I think it will be recorded as an "unfortunate accident. All involved feel bad about it." But Amaral said that he cuts several cords of firewood for winter, and "I never fell a tree without looking up. I can’t imagine a logger missing anything as large as an eagle nest," he said. "But maybe it wasn’t visible from the ground."

Amaral pointed out that there are 260 occupied eagle territories in Maine and "there are multiple nest trees in some. So the number of trees out there are 400 to 500 nets with eagles," he said. "That’s a huge task for one [FWS] person to monitor."

A shorter version of this story appeared in the June issue of Northern Sky News.