The Timber Trust

The problem

The national forests are the largest timber estate in the country and one of the most badly accounted for. The Forest Service manages about 193 million acres and sold an average of about 2.98 billion board feet of timber a year between fiscal 2014 and 2023, selling, by the Government Accountability Office's count, about 90 percent of its own annual targets. Where the money goes is a maze: a share to the counties under a 1908 law, a share retained by the agency for replanting under a 1930 law, a share to a salvage fund, and a residual to the Treasury. What the forest earns, net, is not a number the public has ever been shown.

Two things are known. The first is that the agency has, for decades, sold timber below the cost of preparing the sale, a practice its own accounting once tracked and Congress eventually stopped asking about. The second is that nobody publishes the balance that matters for any forest: how much wood grew this year, and how much was cut. A private timber company reports that number every quarter, because a forest that is cut faster than it grows is a company eating its capital. The public's forest is run without the number.

The states show what the alternative looks like. Washington's Department of Natural Resources manages about 2 million acres of trust forest for schools and counties, sells the growth at auction, publishes the harvest against the inventory, and returns on the order of $200 million a year to its beneficiaries. Its estate is one percent the size of the national forests.

This catalog's rule for a public asset is that it is principal, and principal is never spent. A forest is the oldest form of principal there is: it pays interest in wood. The rent is the growth.

The proposal

The Timber Trust: the national forests are managed as principal. Harvest may not exceed net growth on the commercial timber base, published annually forest by forest. No sale below the cost of preparing it. Every sale by sealed-bid auction with a reserve at cost. The counties keep their quarter. Thinning for fire is funded as a cost and never disguised as a sale. Net receipts are deposited in the American Permanent Fund.

How it would work

1. Growth against cut, in public. Each year, for every national forest, the agency publishes the inventory, the net growth, and the harvest, on the commercial timber base only; wilderness, roadless areas and old growth are outside the base and outside this proposal. The rule is that the harvest on the base may not exceed the growth, averaged over five years so that a salvage year after a fire does not break it. The Multiple-Use Sustained-Yield Act has required sustained yield since 1960. The Trust requires that the arithmetic be shown.

1. Never below cost. Every sale carries a reserve price equal to the cost of preparing and administering it. A sale that does not clear the reserve is not made. The agency may decide that a stand should be cut for another reason, fire, disease, habitat, and it may pay to have it cut. That is a management cost, funded and reported as one. It is not a timber sale, and it will no longer be counted as one.

1. Sealed bids. Sales are by sealed-bid auction, open to any qualified bidder, with results published. Most already are; the Trust makes it the rule.

1. The counties' quarter. Since 1908 a quarter of gross receipts has gone to the counties where the forest stands, for roads and schools. It continues, first, before anything else. № 036 argued rural counties should own a share of what they host; this is the oldest example, and the Trust does not touch it.

1. Replanting from the sale. The 1930 law that lets the agency keep part of each sale for reforestation of the cut area stays, as a cost of the sale. What changes is that the amount is published against the sale, so that a sale whose replanting costs more than its price is visible for what it is.

1. The residual, to the fund. After the counties' quarter, replanting, and the cost of the sale, the net is deposited in the fund as principal. In a good year it is a few hundred million dollars. In a bad year it is nothing, and the rule says so.

1. Fire is a cost, not a harvest. The forests need more thinning than they get, and the agency has for years dressed thinning as timber sales to get it done, which is how below-cost sales happen. The Trust funds thinning from the fire budget, where Congress can see it, and reports the wood removed separately from the wood sold.

The numbers

What is cut. About 3 billion board feet a year on the ten-year average. A national forest growth figure is not published, which is the point; on the commercial base, growth is generally thought to exceed harvest by a wide margin, which means the Trust's growth rule is not a constraint on today's cut so much as a ceiling on tomorrow's.

What it earns. Gross timber receipts run in the low hundreds of millions of dollars a year, a fraction of the more than a billion earned in the early 1990s when the cut was four times today's. After the counties' quarter and the cost of sales, the net today is small and in some years negative. The Trust's first effect is to make the negative years impossible; its second is to make the net a published number.

What Washington shows. Two million acres of trust forest returning about $200 million a year is about $100 an acre. The national forests will never approach that, because most of their acreage is not commercial timberland and should not be. But the commercial base is tens of millions of acres, and the gap between what a trust forest earns and what the national forests earn is the measure of what this proposal is for.

What it costs. The inventory and growth accounting already exist in the agency's Forest Inventory and Analysis programme; publishing it forest by forest is a reporting task. The reserve price costs the agency the sales it should never have made.

The honest objections

"This is a plan to cut more of the national forests." It is a plan to cut no more than grows, on the commercial base only, with wilderness and old growth excluded, and to publish the numbers that would show if that rule were broken. The cut today is a quarter of what it was in 1990. Whether it should be higher or lower is an argument the Trust makes possible by publishing growth against cut, and it takes no side in it.

"Below-cost sales pay for thinning that prevents catastrophic fire." They pay for it by hiding it, which is why Congress under-funds it: the fire budget never sees the true cost of the work because part of it is buried in a sale that lost money. Item 7 funds thinning as thinning. The forest gets more of it, not less, when the cost is honest.

"Timber-dependent counties need every dollar of receipts." They keep their quarter, first, as they have since 1908. The Trust's rule against below-cost sales will, in some forests, mean fewer sales and a smaller quarter; № 036's floor for rural counties is where that shortfall is made up, in the open, rather than by cutting a stand at a loss to generate a county payment.

"Growth is hard to measure and the number will be argued." It will be, as every inventory is, and the five-year averaging is built for that. A private company with a forest on its balance sheet publishes the number every quarter with an auditor's signature. The public's forest can publish it once a year.

"The proceeds are trivial next to the fund's other sources." They are, and the Trust is in the catalog anyway, because an estate that sells its wood at a loss cannot credibly charge rent for anything else, and because the growth-against-cut rule is the model for every renewable asset the public owns: the fishery of № 075, the aquifer of № 131, the range of № 073. Sell the growth. Keep the tree.

Sources

• U.S. Government Accountability Office, Forest Service: Timber Sales in Fiscal Years 2014–2023 (GAO-25-107496), December 2024, and Forest Service: Opportunities Exist to Improve Timber Sale Management (GAO-26-107993)
• Congressional Research Service, Timber Harvesting on Federal Lands (R45688), on receipts, the 25 percent fund, and the Knutson-Vandenberg Act
• Multiple-Use Sustained-Yield Act of 1960, 16 U.S.C. § 528 et seq.
• U.S. Forest Service, Forest Inventory and Analysis programme, growth and removals data, fia.fs.usda.gov
• Washington State Department of Natural Resources, annual trust land revenue reports, dnr.wa.gov
• Proposals № 036 (The Rural Compact); № 050 (The Shareholder's Report); № 071 (The Acreage Audit); № 073 (The Grazing Rent); № 075 (The Fishery Share, forthcoming)