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Yuroks seek $20 million state loan for land

John Driscoll The Times-Standard April 15, 2009

The Yurok Tribe has applied for a $20 million no-interest loan from the state that could secure the first part of a two-stage land deal to significantly broaden its current holdings.

The tribe last fall entered into an agreement with Green Diamond Resource Co. that gave it an option to purchase up to 47,000 acres in two phases. In its application to the State Water Resources Control Board, the Yurok Tribe offers to contribute $5 million from tax credits made available to it through an organization that helps acquire forest land in rural Northern California.

The State Revolving Fund loan would help pay for the first part of the anticipated deal, including land in the Cappell and Pecwan watersheds, totaling 22,500 acres. The land would be maintained for sustainable forestry operations, according to the tribe's application.

”We're hoping we can get the green light and move forward with this project,” said Yurok Tribe policy analyst Troy Fletcher. “We've set a working timeline of June 30.”

The tribe and Green Diamond have been talking about a land deal for more than 15 years. The one currently on the table in the agreement would expand the tribe's land base by 74 square miles in its ancestral territory once the second phase -- 26,500 acres in the Blue Creek area -- is complete. Little, if any, logging would occur in the Blue Creek area, the tribe says, as its importance is highly ceremonial.

Helping with the transaction is Western Rivers Conservancy, which will buy the land from Green Diamond and sell it to the tribe under the four-year agreement. An appraisal of the project is still under way, Fletcher said. Fletcher said that the zero-interest loan is a reasonable and prudent option at a time when there are not abundant funds available to seek for such projects.

The tribe says in its application that the purchase of the 22,500 acres would prevent sediment from logging and road construction and maintenance from getting into streams and the Klamath River. The tribe would use a lighter touch forestry style, using selective instead of clear cutting and selling carbon credits to service debt.

The loan the Yurok Tribe is seeking has a 30-year term. The $5 million match from the tribe comes through tax credits obtained by Portland, Ore.-based Ecotrust and passed on to the tribe. Those New Markets Tax Credits were created by the Community Renewal Tax Relief Act of 2000, according to the tribe's application, and are meant to encourage investments in low-income communities.

The Yurok Tribe's reservation is currently a narrow strip a mile wide on either side of the Klamath River from its mouth to Weitchpec. The new lands, when acquired, could eventually expand the reservation, a process that would have to go through the U.S. Bureau of Indian Affairs.

Green Diamond Timberland Investments Manager Dan Opalach said that a land deal of some sort has been in the works for years, and has nothing to do with the current economic downturn. He added that it's impressive that the tribe may be able to secure substantial funding in the present economy.

”We are very hopeful that it will come together, some portion of the transaction, in June,” Opalach said.

State Water Resources Control Board spokesman Dave Clegern said that the agency is working closely with the tribe, and will be meeting with tribal representatives this week on the matter.

”We realize they have a unique opportunity here with this property,” Clegern said, “and we're moving ahead with this application as quickly as we can.”

Bill Dann with Natural Resources Management in Eureka said that it's possible the value of the timber on the land is down due to the weakness of the market, but that the land value itself is likely to have remained largely unchanged. The company performs timberland appraisals but is not involved with the one ongoing on Green Diamond land.

In fact, land bought for timber management or conservation purposes is often still appreciating, Dann said. Trusts and timber investment groups continue to buy for the long term, he said, even if they have lowered expectations on returns.

The tribe is scheduled to give a presentation to the North Coast Regional Water Quality Control Board at its meeting in Fortuna on April 23 at the River Lodge. The meeting starts at 9 a.m.

John Driscoll can be reached at 441-0504 or jdriscoll@times-standard.com

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