Tribal Council later this month plans to take up the matter of the Warm Springs Timber Company.
Council discussed the issue at length earlier this week, but took no final action as to possible future operation of the company.
The Branch of Natural Resources is an essential partner to this potential enterprise. Council and Natural Resources met with Calvin Mukumoto in regard to the timber company question.
Mukumoto is a business consultant, working with Clyde Hamstreet & Associates, Natural Resources and Council on the idea of establishing a company focused on the sale of reservation timber in 2017.
The issue is of great significance to the tribes, as the approved 2017 budget anticipates timber revenue.
Tribal Council is set to take up the question again on December 27, the last currently scheduled Council meeting of 2016.
Tribal Council established an initial version of the company earlier this year, a necessary step as Forest Products Industries had ceased operation.
The question now is whether to establish the company, in partnership with the Branch of Natural Resources, at least through 2017.
During 2016, the timber company established good marketing relationships in the regional timber industry, Mukumoto said. There were some challenges, he said, as the company was a start-up enterprise.
With a full year of operation in 2017 the timber company could realize a good profit for the tribes, Mukumoto said.
This would be based on the sale of timber from the approved allowable cut. In this arrangement, the company would be the sole purchaser of timber, and would then market the logs to the highest bidder.
These would be delivered log sales, with one exception. The exception would be a test case whereby a sale would be put to bid, and the purchaser would be responsible for harvest and delivery.
The tribes could then compare which approach brings the most revenue and other benefits, such as tribal member employment. Tribal member preference, through compliance with the Tribal Employment Rights Office (TERO), would be another aspect of the 2017 company, Mukumoto said.
A resolution was presented to Tribal Council, including a detailed memorandum of understanding between the company and Natural Resources. The vote on the resolution then raised a procedural question:
At the start of the Council meeting there were nine voting members present, not including the Council Chairman who votes only in case of a tie.
The vote on the Warm Springs Timber Co. was three in favor, three abstain, and three out of the room, as three members earlier had to leave on other business.
The 3-0-6 vote was determined by legal counsel not to constitute approval. Council then set the matter over to the December 27 meeting.
Time is of the essence in deciding the question: timber purchases generally happen early in the year, as mills are establishing inventories for their yearly operation.
Tribal Council is proceeding carefully on this question: This Council does not want to repeat a scenario such as happened over the years with Forest Products Industries, where the tribes did not realize the full value of the reservation timber harvest, said Councilman Jody Calica.
