TRANSCRIPT FROM NPR BROADCAST

Air Date: Week of January 13, 2006

One of the most heated and longest running environmental conflicts in the nation has drawn hundreds of tree sitters up into the Northern California redwoods. Now Pacific Lumber Company says it may have to file for bankruptcy, leaving the famous Headwaters agreement in doubt. Jason Margolis of KQED reports.

GELLERMAN: It's Living on Earth. I'm Bruce Gellerman.
The Pacific Lumber Company has been cutting down redwood trees in northern California since the civil war. The massive, 350-foot tall redwoods once dominated the coast thriving in the region's cool air and heavy seasonal rains. Pacific Lumber was a family-run business until 20 years ago when it was purchased by a Texas corporation, and now the giant timber company is on the brink of bankruptcy.
Pacific Lumber says it can't cut enough trees to pay its debt. Environmental activists and local residents say the company has only itself to blame charging Pacific Lumber destroyed the forest and now there are no more trees to cut. It's the latest chapter in the ongoing saga over logging in California's Humboldt County. Jason Margolis has our story.
[OUTSIDE SOUNDS]
MARGOLIS: Pacific Lumber is located in the small town of Scotia, population 1,117. Scotia is a remnant of a bygone era, one of the nation's last true company towns. Pacific Lumber owns the homes, the movie theater, and the school.
[WHISTLE BLOWS]

MARGOLIS: At noon, the town whistle still blows telling the workers it's time for lunch.
[DELI SOUNDS]
MARGOLIS: At the deli, Mel Berti, who runs the meat counter and sits on a nearby city council, says just a few years ago he'd have 100 customers for lunch. Now, he's lucky to get 20.
BERTI: It's just so frustrating being here all my life and seeing so many people lose their job. You know, when they come in the store and say goodbye to you, there's tears in their eyes.
MARGOLIS: Ask Berti who's to blame, and he doesn't hesitate.
BERTI: The environmentalists. They don't care. They just don't care.
MARGOLIS: Berti is referring to environmental organizations who have battled Pacific Lumber over the past two decades, through civil disobedience and the courts. But talk to Bill Bertain, another local, an attorney whose been fighting Pacific Lumber, and you get a different perspective. When asked who's to blame, it's hard for Bertain to control his temper.
BERTAIN: I mean, when you think about guys getting thrown out of work that didn't have to get thrown out of work because one guy in Texas is trying to expand his wealth without considering the consequences to the people who are affected. It's truly sad. I choke up when I think about it. And it didn't have to be!
MARGOLIS: The modern saga of Pacific Lumber begins in 1985, far from the redwood forests of Humboldt County. It plays out in back offices of Los Angeles investment banks, on Wall Street, and in boardrooms in Houston. There, Texas financier Charles Hurwitz saw a gem of a company ripe for a takeover. Pacific Lumber had cautiously managed their forests for decades, and by 1985 it had the largest supply of virgin redwood forests in private hands left in the world. By Hurwitz's equations, those trees represented a lot of profit.
Around the time of the takeover, Mark Harris was a young environmental lawyer who had recently moved to Humboldt County.
[PLANE STARTING UP]
MARGOLIS: He starts the engine for his Cessna propeller plane and takes me on a guided tour over Pacific Lumber's 211,000 acres, shouting over the roar of the engine.
HARRIS: What I was seeing in 1988 and 1989, in this entire drainage, was giant swaths of forests. Just an unbroken chain in large part.
MARGOLIS: He says when Charles Hurwitz and his Maxxam Corporation took over, logging practices here changed. The old company logged selectively; in 1986, Pacific Lumber began clear-cutting swaths of forest.
HARRIS: As we're flying in now, you can see that there's been just a colossal devastation, directly in front of us. There may be some greenery, but upon closer inspection, you can see that's a lot of brush, baby trees, and not much else."
MARGOLIS: Harris says the company cut too aggressively, often violating California timber laws and the Endangered Species Act. In the late 90's, the California Department of Forestry briefly suspended the company's license for repeated violations. Harris says this style of forestry took its toll. Today, sediment regularly clogs the rivers. Many of the great trees that once shaded waterways like Yagger Creek are gone.
HARRIS: Now, Yagger Creek temperatures are through the roof in the summertime. They cannot sustain, in large part, any type of fish, baby fish that are attempting...
MARGOLIS: When Charles Hurwitz purchased these lands for $863 million dollars, he borrowed much of the money through high-yield junk bonds. The transaction was helped by junk bond dealer Michael Milken and Wall Street financier Ivan Boesky; both later served prison time for securities violations. In order to pay off this debt, Hurwitz sold company property, took money from the employee pension fund, and started cutting a lot more trees. He doubled the rate of logging.
Charles Hurwitz declined to be interviewed for this story. Tom Herman managed his forests through much of the 1990's and has worked in the timber industry on California's north coast since the early 70's. Herman says they took a sluggish company and did what any forester would do on commercial lands.
HERMAN: If you own land that was occupied by old growth timber, you should cut that first. Because timber in its old growth state does not grow. It's at a state of equilibrium.
MARGOLIS: By cutting and creating a mix of young, old, and older trees, in decades to come different parcels would mature at different times. Herman says Pacific Lumber did what every other California timber company had already done decades before, and they were being unfairly targeted just because they had ancient trees left to cut. But, he says, this is private land, not a park.
HERMAN: You know, we were a corporation, and the corporation was set up to grow and harvest trees to make money. Okay? So, I'm not ashamed to say, 'yeah, that's our motivation.' Now, our motivation to make profit, nobody ever communicated to me, we want you to beak the law or be uncaring, or damage the land or the environment to accomplish that. Never.
MARGOLIS: But environmentalists and many in the community saw the new policy as a betrayal of the old ways. Lawsuits quickly piled up. And a more radical environmental movement emerged, as well. The group Earth First! arrived on the scene. Activists began sitting in trees and chaining themselves to logging equipment in the late 1980's and through the 90's. Humboldt County became a magnet for environmentalists from across the nation.
[CROWD NOISE]
MARGOLIS: Rallies became larger and more frequent. One of the movement's main leaders was Judi Bari.
BARI: We have done everything in our power. We've worked through the system. We've changed their laws. We've put, quote-unquote, "the best forest" laws on the books. We've done everything we can to enforce them. And they still take every tree in the forest.
MARGOLIS: Bari helped organize what became known as Redwood Summer. In 1990, roughly 2,000 environmental activists, college students, and retirees came to Northern California for a summer of civil disobedience. Bari organized it along with Daryl Cherney.
[MUSIC]
MARGOLIS: With his large, bushy beard and curly hair, Cherney became a familiar face in Humboldt County, playing his guitar and singing at rallies, trying, often in vain, to lure the lumberjacks onto his side.
CHERNEY: [SINGING] Tell me, where are we going to work when the trees are gone? Will the big boss have us wash his car? Or maybe mow his lawn? I'm a man, I'm a man, I'm a lumberjack man, but I fear it ain't for long. Tell me, where are we gonna work when the trees are gone? Now these corporate mergers make no sense to me.
CHERNEY: And we based our campaign on Freedom Summer, which took place in the Deep South, Mississippi and other southern states in the early 1960's, where Jim Crow laws and segregation were just going unchecked until the eyes of the nation were cast upon what was going on down there. And we felt the eyes of the nation needed to be cast upon the redwoods so that people could see what was going on behind the redwood curtain.
CHERNEY: [SINGING] Tell me, where are we going to work when the trees are gone?
MARGOLIS: Then one day in 1990, Judy Bari and Daryl Cherney were on their way to Santa Cruz to promote Redwood Summer when disaster struck.
NEWSCLIP: An explosion tore through a car being driven by two Earth First! activists on an Oakland street today. Both are alive and have been hospitalized. Earth First! activist Judi Bari was seriously hurt with facial injuries and a pelvic fracture. Daryl Cherney suffered lacerated eyes and ears.
MARGOLIS: Both survived the attack. To this day, nobody knows who planted the pipe bomb, packed with nails. The two activists were initially held as suspects, accused of bombing themselves perhaps to raise publicity. But they were never charged. Bari and Cherney sued the FBI and Oakland police for false arrest and illegally searching their homes. They won that suit and a jury eventually awarded them $4.4 million dollars.
The protests and lawsuits hampered Pacific Lumber's operations, but the company continued to log at a brisk pace. Until a funny, 8-inch seabird almost brought the company to its knees. Again, Daryl Cherney.
CHERNEY: The Marbled Murrelet is an amazing animal. It can fly 60 miles per hour. It has webbed feet, and so it needs a big branch to slide into, kind of like it's sliding into home plate. It can't land on a small branch because its feet are webbed. It didn't have talons to grab.
MARGOLIS: In 1992, the federal government listed the Marbled Murrelet as threatened. One of its last remaining habitats was on Pacific Lumber's property. Suddenly, the company couldn't cut many of its trees. Pacific Lumber fought back, suing the federal government for lost property value. That's when government officials stepped in and began negotiating a deal that would later become known across the country as the 1999 Headwaters agreement.
In it, Pacific Lumber would turn over a small grove of ancient redwoods for roughly $480 million. Pacific Lumber's opponents, like attorney Bill Bertain, said the taxpayers got fleeced.
BERTAIN: Maxxam was paid about $480 million dollars for not cutting trees that they couldn't legally cut in the first place because they had put the species in those timberlands in danger, and thereby made it legally impossible to log those areas.
MARGOLIS: Adding to a general distrust of Charles Hurwitz, he was under investigation for a $1.6 billion dollar government bailout of a failed Texas Savings and Loan, in which he had a controlling interest. Hurwitz' supporters say he was mercilessly harassed by the federal government, which was never able to prove financial wrongdoing.
Pacific Lumber officials say the turmoil surrounding Charles Hurwitz is in the past. They say the company was reborn after the Headwaters Deal. Dan Dill is a senior wildlife biologist with Pacific Lumber and a fifth generation employee. He says more than 100 company scientists are out in the forest, ensuring this firm exceeds the standards of any other in California.
DILL: So you'll see these other timber companies that are operating out there, and they're operating every day. They're not being necessarily criticized for their work, and they're just kind of in the background. And here it is, we're getting nailed day in and day out. At the same time, our buffer woods are bigger, our protection measures are bigger. We have really strong commitments to upgrading of roads, reducing sedimentation of the streams, to increasing the stream conditions for fish productivity.
MARGOLIS: These extra requirements are designed to protect threatened and endangered species like the Marbled Murulet, spotted owl, and red-legged frog. In exchange, the company can log in some areas considered critical habitat. Pacific Lumber CEO Robert Manne says this arrangement was supposed to streamline the approval process for logging trees.
MANNE: It's all about the concept of balance. When we put this series of agreements together, it balanced the environmental protection with the social impacts and the economics of our company. We were assured predictability and certainty going forward from that date. And that we did not get.
MARGOLIS: Instead, many of the company's timber harvest plans have been held up or stopped outright. That's because, most recently, neighbors have argued successfully to state water authorities that Pacific Lumber's logging is ruining their land.
WRIGLEY: We've been in the valley since 1885, but on this particular piece of land since 1903, and it has continuously been operated as an apple farm by my family.
[WATER SOUNDS]
MARGOLIS: Christy Wrigley walks through her apple orchards on the North Fork of the Elk River in Eureka. Pacific Lumber owns the property in the watershed above her home. She says Maxxam's increased logging has filled the river with sediment. Now, she says, it regularly overflows, flooding her property. She no longer drinks the muddy river water.
WRIGLEY: We don't have a river anymore. We don't have a source of water. The most importation aspect about being able to live anyplace is clean water. This is not a source of good clean water. They have turned that river into an industrial waste ditch.
MARGOLIS: Pacific Lumber officials and scientists say they're trying to fix this sediment problem and repair past damage. Still, many don't trust Pacific Lumber, and some have again taken to the treetops to voice their protest. Most famously, Julia Butterfly Hill sat in one ancient redwood for two years in the late 90's to keep it from being cut. Her act spawned many followers. As recently as two years ago, an estimated 26 people were living in Pacific Lumber's trees. I visited one, occupied by a woman who calls herself "Remedy."
WOMAN: [ON GROUND] How you doing today?
REMEDY: [IN TREE IN FAINT DISTANCE] Good.
WOMAN: [ON GROUND] I'm good. How's your battery?
MARGOLIS: At the base of this 1,200 year-old-tree, Remedy's supporters brought cell phone batteries, food, and water; they took away trash and bathroom waste.
WOMAN: [ON GROUND] Hey Remedy, I needed you to send your empties
MARGOLIS: High above, "Remedy" completed the complicated transfer, using bags and ropes on a pulley system. The only way to talk to Remedy face-to-face was to climb up.
[SOUNDS OF HEART BEATING AND GRUNTING; BIRDS CHIRPING IN DISTANCE]
MARGOLIS: One hundred thirty feet up, wearing a blue bandana and eyeglasses, Remedy looks like the all-American girl next door, except she's a little dirtier and she lives in a tree. She says she's here to raise public awareness.
REMEDY: Tree-sitting works because a lot of people don't know that timber companies are still cutting down 1,000 and 2,000 year old trees. So, this really gets people's attention.
MARGOLIS: Remedy pointed to a study, well-known in her circle, done by a Maxxam consultant in the late 1980's.
REMEDY: The study actually showed the environmental degradation that would happen, the loss of endangered species habitat. The loss of jobs, sedimentation in the rivers. They predicted everything and they went ahead and did it anyway. So, it's not like they just incidentally, accidentally screwed up the environment and had to layoff a bunch of people because of it.
MARGOLIS: Remedy says they want Pacific Lumber to stop clear-cutting, cutting old growth, spraying herbicides, and logging on unstable slopes.
REMEDY: If they do that then there will not be any more action against them. There will be no more protesting Pacific Lumber Company. They will then be the company that they're trying to prove to everybody that they are.
MARGOLIS: Flash forward to today: There are still people living in trees. Pacific Lumber executives say nothing they do will please their critics, and the protests, lawsuits, and regulations have taken their toll. In its latest filings with the Securities and Exchange Commission, the company warns of more layoffs, shutting down some operations, and bankruptcy. And if Pacific Lumber files for bankruptcy and sells its forests, it's an open question what might replace all those hard fought environmental agreements. For Living on Earth, I'm Jason Margolis.
 


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