The district’s forestry industry is undergoing major reforms with respect to forest management and logging.
A new forest tenure is being created to address issues with the current system, as well as create better opportunities for companies that wish to log here.
The goal of the new forest tenure, which takes effect on April 1, 2020, is to move more wood, make things more cost-effective, provide stronger local representation, and have fewer fights between logging companies over Crown land.
“We will see reduced costs in the management of the forest and a more inclusive process that will better address the business needs of the forest industry,” forest tenure consultant Mike Willick said during a presentation at the Rainy River District Municipal Association’s annual general meeting held Saturday at the Millennium Hall in Stratton.
From a community standpoint, Willick said First Nations have felt left out in the past and they now will have a direct say in forestry operations through the creation of a “partnership company” focused solely on forest management.
This company will include representation from municipalities, area First Nations, consuming mills, logging contractors, and economic development entities with the specific purpose of managing the forests.
“Communities will be aware of and have influence over future economic opportunities,” Willick stressed.
In the past, new opportunities were not taken advantage because of “administrative red tape,” he noted.
Currently, large forest companies that hold a sustainable forest licence (SFL) are responsible for forest management planning, calculating the available cut, determining who will cut, and the costs being passed onto others for management services.
As well, they arrange for local road building for access to the forests before going in to cut.
“In return, what they get is access to all the Crown trees in that forest, except those volumes that are specifically assigned to some other mill,” Willick explained.
“The large company takes on a large responsibility in return for management control of the forest.”
For decades, the current tenure system worked well–mills were profitable, economies flourished, and the communities prospered.
The decisions made by logging companies generally didn’t adversely affect municipalities–up until the economic crisis in 2008.
“Companies went bankrupt, mills closed, jobs disappeared, and sustainable forest licences were returned to the Crown,” noted Willick.
“Economics forced the forest companies to only consider their corporate needs just to survive.”
Forestry companies then decided their core business was producing forest products and that forest management shouldn’t be their focus.
“It ended with a general dissatisfaction with the forest tenure system right across the province,” Willick said.
As a result, trees no longer were being cut, new opportunities were blocked, and some mills ran out of wood because of administrative encumbrance.
The province then realized there might be a better way, and decided to move to a model where the interested parties from across the forest join together to take on management of it.
This is done through the “partnership company” that features representation from a full cross-section of the stakeholders.
The board of directors for this new company will be comprised of 12 individuals, with six forest industry members and six community-based representatives.
The province held extensive consultations, and passed legislation in 2011 called the “Ontario Forest Tenure Modernization Act,” to enable these changes to the former model.
In the new legislation, the province set a few key principles, one of which stated the “partnership company” must be flexible to invest in local services and have representation from local indigenous and non-indigenous communities.
“The business arrangement will respect the existing wood supply and honours [previously-made] commitments,” Willick stressed.
“This is not about taking the rights that have been provided by the ministry and giving them to someone else.”
An independent general manager also will be hired to overlook the “partnership company,” and will be responsible for issuing contracts, allocating cutting areas, and leading the company.
Under the new forest tenure system, Willick said they will look to amalgamate the Crossroute and Sapawe forests to form one large land base.
The reasoning behind the amalgamation is to save money on forest management planning, provide better protections of forest land, and boost efficiency.
Moving forward, forestry companies will decide whether they want to sign onto the new shareholder agreement with respect to the “partnership company” that is responsible for all forest management.
These companies will take the shareholder agreement to their lawyers and discuss whether or not it meets their needs.
After signing on, the new forest tenure reform will go into effect for April, 2020 and companies will begin logging under the new regulations.
“These changes that we make now are going to influence forest management in the district for decades to come,” Willick remarked.
“This is an excellent opportunity for communities to become involved and aware and have influence over the decisions that are made on our forests,” he noted.
“The forest business provides significant economic benefit to the area and communities need to have a voice at the table,” he reasoned.