Ambitious Mat-Su timber deal gets go-ahead despite public protest

A fast-tracked Susitna Valley timber venture some call the salvation of the Mat-Su's foundering port won local government approval Tuesday amid concerns about public process and log truck traffic.

The Matanuska-Susitna Borough Assembly backed the complex proposal in a 5-2 vote near midnight.

The deal hinges on a 24,000-acre borough timber sale known as Chijuk Creek, off Oilwell Road in the Trapper Creek area about 22 miles southwest of Talkeetna and 30 miles northwest of Willow. Logs would be trucked to the government-owned port at Point MacKenzie and shipped to China.

The pace of the project and lack of competitive bids drew sharp criticism, as did a flurry of last-minute changes.

A transportation plan required before 20 to 30 trucks a day can start hauling logs was submitted just hours before Tuesday's meeting.

An amendment approved minutes before the final vote also exempts the sale from a section of borough code that calls for public input, fair-market valuation and competitive bidding.

"I have no confidence in the process that just took place," said Assembly member Jim Sykes, who cast one of two "no" votes and had called for open bids on the sale.

[Mat-Su floats major new timber venture. But is it too good to be true?]

Others, however, cheered the prospect for new timber jobs, the removal of spruce bark beetle-killed forests and the potential for long-sought revenues for the cash-strapped, government-owned port.

"These guys are seriously committed and they're seriously going to dump a bunch of money into this community," said Randy Chivers, owner of Got Wood Alaska trucking company in Wasilla.

The timber is owned by logger Charlie Nash, who sued the borough and won a state Supreme Court decision before settling in 2013. Nash's suit came after the borough terminated the sale for not cutting enough trees and leaving others behind.

Locals say timber is still rotting on the ground, though Nash said people forget he poured millions of dollars into road improvements.

A new company, Denali Timber Management, formed late last year by a third-generation Northwest timber manager, would be in charge of logging and getting the logs to the port. A New Zealand firm, TPT Forest Products Ltd., secured markets in China for logs.

All but one of 10 prior borough timber sales elicited no bids because of high transportation costs and no local markets, officials say.

They estimate the project could drum up nearly $900,000 a year for the port, which is losing $800,000 to $1.5 million each year.

The Assembly voted Tuesday to approve two separate contracts for the timber sale at $31.50 an acre — as established five years ago in the Nash settlement — and a lease at Port MacKenzie that gives Denali exclusive rights to export logs to Pacific Rim countries for three years.

Denali's transportation plan must still get planning department approval before the contracts become effective. A 30-day comment period just opened.

The borough is requiring a $150-per-acre reforestation bond and a $100,000 performance bond, according to a five-page fact sheet distributed Tuesday. The borough also added Denali to the timber sale contract with Nash.

The contractors must maintain Oilwell Road in at least the same condition so costs don't increase to the local taxing district, the fact sheet says.

Denali owner Eric Oien told the Assembly he expects to make various safety upgrades, including adding a large trailer parking lot at Amber Lake 12 miles up Oilwell Road.

The Alaska Division of Forestry still needs to approve the timber sale. The state has 30 days to respond to an operations plan submitted March 12.

Citizens packed Assembly chambers for the meeting, spilling into the hallway outside.

Numerous people testified before the vote about the lack of time for fully vetting the proposal and the public safety threat posed by heavy log truck traffic on narrow, rutted Oilwell Road.

Kathy Ernst, a 45-year Trapper Creek resident and EMT, accused the borough of "contracts changed secretly" and said exempting the sale from an entire section of code established to protect the public set a bad precedent.

"I do not want to respond to an accident between a logging truck and a bus," Ernst said. "I've been on those kinds of calls."

The Trapper Creek Community Council, the advisory body located closest to the sale, hasn't had time to take a position on the sale.

The Point MacKenzie Community Council has concerns about log trucks adding more wear to Point MacKenzie Road, council president Gary Foster told the Assembly.

The first seven miles of road haven't been resurfaced in a decade, Foster said. "You can't continue to put enterprise out there and not do something."

Several Assembly members put the credit or blame for the deal's fate on the borough's manager, John Moosey, who faces his next performance review in May.

Sykes chastised the manager for quietly adding a week to the Chijuk timber sale contract late last Friday while the Assembly sorted through documents thinking it expired April 15.

But Assembly member Matthew Beck said his support for the proposal reflected his faith in Moosey.

"We're putting a lot of trust in the manager if we pass this tonight to make sure the work he's given us, that he holds true to it," Beck said before the vote. "He's proven over the past five years that he can get some things done and be trustworthy."