July 11, 2012
By Molly Messick
In Idaho, the timber and ag industries are heavy hitters. They play big roles in the state’s history and identity. But the recession has dealt them different hands, dividing rural Idaho into winners and losers. StateImpact Idaho takes a look at two industries, two counties, and two economic fates.
Rancher Chris Black and his son, Justin, manage a thousand head of cattle on 135,000 acres in the foothills of southwest Idaho’s Owyhee Mountains. They spend most of their time miles apart – miles from anyone, in fact – working cattle. But this day is a little different. They’re walking to the corral not far from the small solar and propane-fueled house where Chris Black lives on and off from April through November.
“Are you going to catch a horse?” Chris Black asks his son. “I’ll ride Happy,” he says. They’re saddling up so they can move a group of cattle, grazing a few miles away.
Chris Black was up before daylight, and now the sun is blazing overhead. Ranching is hard work and not for everyone. He admits that. But lately, business has been good. “We’ve fared well in the last two to three years,” he says. “We’ve fared quite well.”
Cattle prices are up. That means he can breathe easy for now, and put money back into his operation. “For instance, I bought a new tractor,” Black continues. “My tractors were really old and in poor shape and – the older one was a ‘70s model. And I traded it off for a brand new.”
Farming and ranching are known for their hard luck and slim profit margins, but for the last few years high commodity prices have buoyed the farm economy. For the most part, the Idaho counties associated with agriculture have seen their unemployment rates remain low throughout the recession. Take Owyhee County, where Chris Black’s family has ranched for generations. Here, unemployment has seldom crept above six percent since the downturn began.
Four hours north, in Adams County, the story is different. The appliance store in Council broadcasts a steady stream of old country hits onto the main street. A 1960s Buck Owens classic blares as trucks pass by. But the town’s reality is less cheerful than its soundtrack. In this county, unemployment has soared from pre-recession lows of three and four percent to more than 19 percent last fall. That’s one reason I reached out to Mark Mahon, a fourth generation logger, born and raised in Council.
“So do you know what loggers call our work pick-ups?” Mahon asks, as we jump in his truck.
“Crummies,” he replies, deadpan. “Because they’re crummy.”
He drives out to a nearby logging site. Owyhee County is known for its vast acres of grazing land, but here in Adams County, timber is the legacy industry.
Along with his parents and brother, Mahon runs a logging company with fourteen full-time employees. They have one of the largest private payrolls in the area. Still, this is an anxious moment for their business. “Our company is stable,” Mahon says. “We’ve got good equipment and good employees, and they’ve been with us a long time. But I’m constantly stressed and worried about work. Right now, we don’t have enough work to finish this logging season.”
It’s the end of a long day. Mahon sits on the ground, surrounded by tall Douglas Fir and Ponderosa Pine. The air is sharp with the smell of freshly cut timber.
Mahon’s company was hired to manage and thin this forest. It’s a small job – 1,000 acres of private timber land – and it’s one of four contracts they have right now. They need to line up more. “The biggest concern I have is the men that work for us,” he explains. “Am I going to be able to provide the jobs for them so that they can support their families? And if I can’t provide for them, that’s almost like I’ve failed.”
Mahon says he’ll feel he’s failed not only those workers, but also his hometown. In rural places like this, every job counts.
The meltdown in the housing market is the most immediate problem for loggers like Mahon. Fewer homes being built means less demand for lumber. But the housing downturn caps a long period of contraction for Idaho’s timber industry. Jay O’Laughlin directs the policy analysis group at the University of Idaho’s College of Natural Resources.
“During the 1980s, the forest products industry in Idaho was twice as big as it is now,” he says.
It’s not easy to pinpoint the defining differences between agriculture and the timber industry that contribute to the differing economic fates of Idaho’s rural areas. But O’Laughlin says land ownership is a big factor. Idaho’s agricultural production happens mainly on private land. The timber industry faces a separate set of circumstances.
“Seventy-five percent of the timber resources in the State of Idaho are on federal lands,” he explains. “And that’s an entirely different situation than agriculture, with the one exception of grazing.” And ranchers have so far not faced the same regulatory pressures as the timber industry.
O’Laughlin says national forests used to provide at least half of Idaho’s timber harvest. Today, they provide less than 10 percent. Underlying that shift is the decades-old push by conservation-minded groups to demand greater environmental analysis ahead of timber sales. In short: the timber wars.
Mahon says this hard economic moment is spurring consolidation. Loggers with better equipment and access to timber will pull through. It’s similar to the process that’s ongoing in farming and ranching: fewer people work ever larger swaths of land.
Chris Black and Mark Mahon both want to be survivors.
“This is the ideal,” Black says. He’s standing next to his horse, miles from cell phone service, or the nearest home. “For me, anyway. Is being out here and doing the things that I have grown up and love to do.”
Mark Mahon feels that same love of work, and tradition. “Some of the greatest things about logging is every day you get a picnic lunch,” he says. “You get a moonlit ride and a picnic lunch. I wouldn’t trade that for anything.”
He wouldn’t trade it, and he hopes he never has to.
May 21, 2012
By Molly Messick
You might not guess it, if you happened to pass through, but tiny Rockland, Idaho, population 318, is a place of distinction. The town has no grocery store. Its gas station is just a couple of unmanned pumps where you pay by credit card. But what this town does have is a school, and local people stand behind it.
Jon May was the first person to cast a ballot at Rockland City Hall last week. It was primary day, and the local school levy was up for a vote. I asked May if he supported it.
“Yes, I did,” he said. He always does.
When public schools are short on money, they have a last resort. They can go to voters, like May, and ask them to pay extra. As state funding for Idaho schools has dropped, many districts have done just that. But there’s a hitch. Levies can lead to unequal tax burdens and disparate funding levels for students.
In Rockland, May is in good company. While some districts have trouble getting voters to support school levies, in this town, the levy is a shoe-in. It never fails, even though people in this district pay the highest rate in the state.
There’s little Rockland School Superintendent Jim Woodworth likes more than showing off the school — the classrooms, the new gym, the playground. He gestures, proudly. “The grass and everything out here we put in ourselves,” he says.
The school isn’t fancy, but local people have had a hand in all of it. The grass on the playground, put in by volunteers, is the smallest example. Woodworth gives another: the school building. Local farmers and ranchers excavated the site themselves. “They brought their trucks and tractors, and we spent one whole summer moving dirt and hauling gravel,” he says. “We saved close to $250,000 just by doing the excavation for the building ourselves.”
That was years ago. Recently, Rockland residents got together to paint the new gym. Woodworth has lined up volunteers to repair a tennis court this summer. All told, he estimates the school has saved half a million dollars. They need every penny. This district has seen a 20 percent decline in state funding in the last three years, according to figures from the state Department of Education.
It’s a reality Woodworth absorbs with the calmness you’d expect of a small-town superintendent who wears Wranglers to work and ranches on the side. “You know, sometimes you get a little upset, because you think, ‘Well, you know, you guys could be doing more for us. You could be helping us out a little more.’ And yet, when it’s handed down to us, we just take it and go with it,” he says. “I mean, that’s all we can do.”
And when what’s handed down is less money, the school has to ask taxpayers for more.
Sharee Petersen is in the middle of a busy day, loading cows and calves into a truck on a ranch outside of town. She points to the line of them, plodding past. “The calves were born January, February, March. We start calving the end of January,” she says. Then she moves off quickly, whistling and calling, herding them toward the open gates.
If there’s anyone who understands the school’s tight budget and the pressure it puts on local people, it’s Petersen. She grew up in Rockland and ranches with her dad and brother. She also heads the local school foundation. Her kids are three of the 167 who attend Rockland School, K-12.
Later, Petersen tells me the tough thing about the school levy is that it falls to farm and ranch families like hers to pay the largest share. “We don’t have a lot of booming businesses out here. We have a lot of grazing land. We don’t have Simplot or Lamb Weston out here to help – help with our tax base,” she says. “So we have to rely on the farmers, and that’s a bad deal!”
According to the county assessor’s office, the largest farms and ranches in this district pay about $5,000 toward the school levy each year.
Here’s the hard situation for Rockland: it has some of the lowest property values in the state. In order to raise the extra $210,000 their school needs to get by, taxpayers here agree to a levy rate that is 17 times the rate paid in one of the state’s wealthiest school districts. Mike Ferguson of the Idaho Center for Fiscal Policy says that might go against the state constitution. “Property taxes are supposed to be levied uniformly,” he says. “And by having the districts with levies all across the board, some at zero, some at relatively high rates, that’s not uniform property taxation.”
Ferguson says unequal taxation is only part of the problem. The other issue is that education funding can vary dramatically, depending on a district’s property values. That’s potentially bad for students. “Depending on which district a student lives in, they may get zip from a supplemental levy, or they may get a lot,” Ferguson observes. “That has a direct bearing on the quality of the education that they will receive.”
All of this plays out in Rockland.
At the end of the school day, music teacher William Lower leads the high school band in one of its last practices before the end-of-year concert. They’re taking an exuberant but slightly shaky run through “Wade in the Water.”
“Stop!” Lower calls out. “Measure 47, did any of my flutes play an E flat?” he asks. From the front row, a flautist acknowledges that they all might have messed up. “Yeah, it sounded like all of you!” Lower says cheerfully, picking the piece up where they left off.
People in Rockland are proud of their school, and rightfully so. It’s the heart of their community. They’ve volunteered and paid extra to support it. But Lower says that strategy has its limits. “If you keep volunteering to do things, people will begin to expect you to simply volunteer all the time,” he says.
He sees that happening already. “What’s happening with the state is – we had people who agreed to volunteer, and now the state is saying, ‘Well, now you have to volunteer. And if you don’t volunteer, then your kids are going to suffer.’”
In spite of this community’s dedication, Rockland School has cut back. It has gone to a four-day school week. Textbooks aren’t updated as often as they used to be. Teachers haven’t had raises in years. Local people say they’ll weather all this. If the school goes under, the town goes under, they say. And they’re determined to keep both afloat.
September 21, 2012
By Molly Messick
If you look at a map of where wind development has taken off in Idaho, you’ll notice an area near American Falls. There, in the rolling agricultural land of southeast Idaho, Edith Kopp stands on a high hillside. She gazes out with satisfaction at more than a dozen turbines, turning steadily.
“This is a pretty constant wind,” she says. “They’re all going!”
Kopp and her husband, Richard, have spent their lives right here, farming grain. For decades, they’ve planted in spring and harvested in summer. They’ve tallied profits and losses as winter sets in. The years have been marked by anxiety, and hope.
“Hopefully at the end of the year when you sell your crop, there will be something left for you,” Kopp explains. “In 33 years of marriage there’s been several of those years when there wasn’t anything left for us.”
She pauses, and then says, “This is the first time we’ve ever had a steady income.”
That income is thanks to wind turbines like the one that towers above us. A wind developer owns it, but the Kopps own this land. To them, the turbines mean royalty payments for the rest of their lives.
Wind development has taken off in Idaho. In four years, 30 wind projects were approved in the state. Before then, Idaho had just one wind farm. Now, legislators and the state’s utilities are pumping the brakes.
The Kopp’s story is the kind wind developers love to tout: here in Idaho, clean and renewable wind energy is sustaining rural communities. But you don’t have to go far to get a very different take on wind development.
On the roadside, on the way out of American Falls, there’s a billboard that reads, “swindle.” The letters w-i-n-d, spelling “wind,” are in red. Then the sign reads, “Not cheap. Not clean. Not for Idaho.”
It’s one of several nearby. They’re sponsored by a local anti-wind group called the Energy Integrity Project, and they aren’t the only opposition the industry has faced here. There have been objections about spoiled landscapes and preferential tax policy. A proposed moratorium on wind development has won support from prominent legislators. Then there’s Idaho Power’s campaign. Through TV ads and leaflets, the state’s largest utility has worked to spread a simple message: wind power drives up electricity prices.
So what’s going on here? Why did Idaho welcome wind and then turn a cold shoulder? The answer is the story behind the story of Edith and Richard Kopp’s wind turbines. And it has to do with a federal law you’ve probably never heard of: the Public Utility Regulatory Policies Act of 1978, also known as PURPA.
“Congress, when it passed PURPA, their goal was essentially national security,” explains Peter Richardson, who practices energy and utility law in Boise.
Here’s the context: it’s the late 70s, and there’s an energy crisis. Government wants to encourage independent power production, but there’s a problem. The utilities control electricity generation. They’re monopolies. They don’t want to distribute power they don’t produce. So, here’s what PURPA does: it makes utilities accept power from small, independent projects. They don’t have a choice.
Now, fast-forward 30 years. There’s anxiety about climate change and job creation. Congress passes a tax credit for renewable energy production. Idaho passes a property tax exemption for wind producers. At the same time, wind turbines become a lot cheaper. Plus, PURPA is still there, telling utilities they have to accept power from small, independent producers. Wind developers rush into Idaho, catching the state off-guard. And that brings us to today.
“The utilities are using this accident,” Richardson says, “this perfect storm, that allowed for a very large amount of wind to be developed to put the kibosh on all PURPA projects.”
Richardson represents many wind developers, and this is his view: that the utilities are trying to dismantle the mechanism that forces them to accept energy from small, independent projects. He says the utilities want to protect their market power, and their profits. No surprise, the utilities don’t see it that way. Mark Stokes is the manager of power supply planning for Idaho Power.
“I would not characterize it as us trying to dismantle PURPA,” says Mark Stokes, the manager of power supply planning for Idaho Power. “We are just trying to get the rates that we pay for this energy through these contracts to be a fair rate, so that our customers aren’t harmed.”
Idaho Power has a couple of arguments. First, wind doesn’t always blow, and turbines don’t always turn. For utilities, that varying supply can be hard to accommodate. Sometimes, Stokes says, Idaho Power winds up with way more energy than it needs.
“We end up having to turn around and sell that energy back into the market, because it’s surplus,” Stokes says. “We end up taking a big loss on that, which ultimately ends up impacting the rates of our customers.”
Stokes and Richardson don’t agree about much, but they both say one key thing. There’s a rate – set by the Idaho Public Utilities Commission – that dictates how much utilities pay for the independent power they have to accept. Stokes and Richardson say that rate may, for a time, have been set too high. In other words, when wind developers looked around to see where they should build projects, they saw a special deal in Idaho.
The utilities want a lot of changes to the way PURPA works in the state. Those include shorter contracts with independent energy producers, and a different way to calculate rates.
Richardson says the utilities’ proposals would shut wind developers out of the state. “Instead of turning the spigot on and off to allow new development when it’s needed, they’re basically blowing up the well!” he says.
These arguments are currently before the Public Utilities Commission, which is expected to rule next month. The Federal Energy Regulatory Commission has already weighed in on one aspect of the case, coming down in favor of the wind industry.
What can we take away from all of this? Let’s hear from one more person: Ben Otto, of the Idaho Conservation League. He’s a fan of clean energy, but he says Idaho hasn’t approached it in the right way.
“Business is just reacting naturally to what is placed before them,” he says. He imitates an old-fashioned ad man. “’Here’s a very lucrative thing, and it’s a limited-time offer! Get it now, before we’re out!’” And that’s because Idaho doesn’t have much of an energy plan, Otto says.
The state does have a document called the Idaho Energy Plan, but Otto and other expertssay it has little weight. Otto believes that leaves the state in a binge-and-purge cycle. “When the incentives are hot, everybody comes in,” he explains. “When the incentives go down, everybody leaves.”
A federal tax credit for wind power is set to expire in December, making this particular cycle even more dramatic.
Now let’s think back to the start of the story and to Edith Kopp, standing under a turbine on a hillside near American Falls. Why did Idaho welcome wind farms, and then change its tune? The answer is complicated. It’s about state and federal policy, and businesses looking for profit. And it’s a case study in unintended consequences.