Timber Taxes

Logging contracts extended on some federal lands due to COVID-19

'World market conditions' cited as reason for delay of up to 2 years

MADISON, Wis. -- Citing economic disruptions from COVID-19, the U.S. Department of Agriculture will make available extensions of up to two years for many logging contracts for U.S. Forest Service lands.

The notice of possible extensions came in an announcement in the U.S. Federal Register on April 15 by James E. Hubbard, Under Secretary for Natural Resources and Environment of the DOA.

The announcement cited economic disruptions from the COVID-19 pandemic and a number of trade dispute issues that have affected lumber and timber markets.

“Due to the complex factors involved, recovery is expected to be a protracted process,” the announcement said. “A unique combination of world market conditions, the COVID-19 pandemic and a massive bark beetle epidemic in central Europe has created an unprecedented worldwide instability in timber industries and associated markets.”

The announcement suggested that contracts would be extended unless there is an urgent need for a harvest due to forest health concerns or “wildfire threat mitigation”.

“To receive an extension and periodic payment deferral, …..purchasers must make a written request and agree to release the Forest Service from all claims and liability if a contract extended pursuant to this finding is suspended, modified or terminated in the future,” the announcement said.

Without extensions, timber buyers might have to decide whether to harvest during extremely depressed market conditions or risk a default of their contract. An extension can provide flexibility to “navigate the crisis”, the announcement said.


For a full text of the announcement see: https://www.federalregister.gov/documents/2020/04/15/2020-07973/extension-of-certain-timber-sale-contracts-finding-of-substantial-overriding-public-interest

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