-defective areas of the current ap-

TERRACE — A fundamental
‘change in the way the Ministry
-of Forests collects stumpage fees
‘from the businesses who harvest

_ .. timber in the province has gotten
_ 8 gloomy reception from the ma-

_ jor forest companies, and one

Terrace-area contractor said

Tecently the new system will con-
tain more inequities than the

system it replaces.
~ “The old’ system has its prob-

~ lems, but we learned to live with

them,”’ Rod Arnold, owner of
RJA Contracting, said, ‘“*The ef-

fect (of the new system) is going

to be negative.”
Arnold pointed’ out several

praisal system that he said will
not be addressed, and may in
fact be aggravated, by the new
measures, Although the timber
cruising methods are accurate to
about 15 percent, he said the
system is not as indicative of
timber values as it should be and
information is needed to develop
closer evaluation. Arnold

' characterized the revenue-target

system as ‘‘irying to dial in a_
number’’,

_ Arnold expressed particular
concern for small- operators,

noting that. a considerable
amount of their funding, a
minimum of $400,000, is tied up
in inventory. He said - small,

locally-based contractors are

hard hit by market changes that
aren’t. reflected in stumpage,
and he noted ‘the market never
climbs as fast as it drops’’.

“It?s unrealistic for the

Golf —
continued from page 8
' The district team prize based

‘On-net scores went to the Terrace

foursome of Edith Gieselman, -
Bonnie Shaw, Gail Johnson and
Audrey cox.

Smithers’ Louise Evans won a.
plane trip to Vancouver for be-
ng the closest golfer to the pin
on a par-three hole,

The Golden
Razor.

\

It’s time for .

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Starting Sept. fu 1987

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4646 Lakelse Ave., Terrace .

figure,’” he said. “It. should be
based on the mark

In an interview after the in-
troduction of Bill 40, the legisla-
tion to amend the stumpage
system, Forests Minister Dave
Parker explained that the pres-
ent system levies stumpage rates

that are based on the. market.
value of the timber cut. The new

system will establish a target
revenue for the Ministry and col-
lect it by dividing the goal
amount by the annual allowable
cut.

“We would like to see targets
set for each (forest) region to

reflect local conditions,’’ Parker

said. He indicated stumpage will
still be predicated on the cost of
harvesting timber and said
licensees will be required to pro-
vide the Minsitry with confiden-
tial operating ‘cost information.

. “With hard information we can

identify the operating costs in

each zone and project the costs:
to the operator. If the cost is

above average we-can put the -

stumpage up, and if it’s below

average we can adjust it down,”

he said.
Parker also “noted that

a ‘stand as a whole’ basis

rather than as a separate rate for

each species. .
Forest companies who ship to

. the United States and pay. the 15.
percent export tax will receive a -

proportional rebate or credit

against their stumpage royalties,

Parker said, ‘and Section 88 of

‘the Forest Act which provides.
‘credits for silviculture and road-

building costs will remain intact.
The new amendments also give

the Forests Minister statutory
-authority’ to change stumpage

rates without legislation, ‘““‘We’ll
have more flexibility, and we'll
be able ‘to change the rates
anytime, overnight if necessary,

_ Terrace Review — Wednesday, August 26, 1987 15.

to reflect conditions,” he said.
Parker concluded: by, saying,
“The purpose of these changes
is to fund forest management,
not to destroy the industry."”

__ REVENUE TARGETS VAGUE
assessments will be expressed on

The stated objective of ihe
new system is to make forest

.Management in B.C. a self-

liquidating proposition, but the
cost of “forest management’,
and consequently the revenue
expected from the new rates, ap-
pears open to interpretation.
Sources within the Ministry in-

“dicated that the “‘cost of forest
“management” could mean the
entire Ministry budget with the

exception of Lands operations,
or about 90 pecent of what, this
year, will’ be a $425 million
operation.

According to Ken. Baker,
manager of stumpage ad-
ministration in the. Ministry’s
Valuation Branch, the govern-

ge system creates apprehension _

government to set a_ target

ment, collected $166 million in
-stumpage fees on an -actual
harvest of 65.6 million cubic
meters. during the 1985-86 fiscal
year, Baker said he expects the
1986-87 figures to be closer to
$200 million. *

He noted that the stumpage
figures: don’t include revenue
.from other ‘sources such as
royalties, scaling, export fees

‘and timber stand rentals, but the:

‘Stumpage revenue is also a gross
figure that doesn’t take into ac-
count credits of $71 million for
Section 88 projects, .

The Ministry has allocated
$105 million for Section 88 this
year, and if the export tax pro-
ceeds of about $350 million go

into general revenue rather than °

forests, as they have up to this
point, the rebates or credits
against stumpage to offset the.
tax for operators will represent a

net loss to the Forests Ministry, , ..

continued on page 24

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regular order of delicious Hotcakes for only 35¢.
Offer valid only at McDonald’s In Terrace. -

during Breakfast hours, Monday — Friday

~ Wie Co LUMRILT ERENT ss
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