Receivership for WSFPI

Tribal legal counsel this week is expecting to file a petition in tribal court asking for the establishment of a receivership for Warm Springs Forest Products Industries.

This is being done as directed by Tribal Council resolution, as the mill as currently operated is no longer viable.

The receivership process will involve appointment of the receiver, who will assume the legal control of the WSFPI assets, and begin evaluating the claims of the various creditors.

Counsel has recommended the appointment of Edward Hostman for the position, as he is experienced in this kind of procedure.

There will be tribal court over-sight, possibly by a pro tem judge retained for this particular case.

Tribal management and legal counsel have met with the proposed receiver, and have given him a general overview of the situation.

Specific plans for how best to deal with the WSFPI assets and debts will develop once the court has made the receivership appointment.

The tribes are also working with Clyde Hamstreet, of Hamstreet and Associates, who works with companies that require financial turnaround. The WSFPI enterprise is not viable, but the Confederated Tribes have the valuable asset of timber as well as the mill complex.

The goal will be to develop a plan going forward, giving the greatest return on the use of the asset, whatever that may be.

The forest resource could be managed to allow timber harvest, and then sale of the logs for the financial benefit of the tribes. The Tribal Council is asking Hamstreet and Associates to develop all viable options.

The carbon sequestration program has also shown that there is value in the timber that is left standing.

The timber resource is a tribal trust asset. Revenue generated from the resource has been used for the senior pension, for instance, as this income is not subject to taxation.

Other sources of tribal revenue, those not based on the use of a trust asset, are subject to taxation.

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