Professional Documents
Culture Documents
Oregon Timber Towns
Oregon Timber Towns
tide has turned. The spotted owl’s designation as an endangered species enabled a flood of ing sizable profits. Then the bubble burst.
lawsuits from environmental groups that eventually brought an end to the high-volume Lumber prices have collapsed as housing
logging of national forests and created rural/urban divisions that fester to this day. Bob starts have plummeted. The industry faces a
Ragon, executive director of Douglas Timber Operators, estimates that Oregon and Wash- massive over-capacity problem that federal
ington have lost 35,000 jobs over the past two decades. Ragon’s clients have been among the logging would only worsen.
hardest hit, because 63% of Douglas County is publicly owned forestland. Ragon estimates that the industry is oper-
There is no disputing the role federal forest policy has played in the demise of Oregon’s ating at about 60% of capacity while await-
timber towns. But the real problem the timber industry faces in the contemporary economy ing prices healthy enough to justify revving
has to do with demand, not supply. For a few years, as the housing boom reached its peak up production. “Everybody has run into the
and developers cranked out speculative subdivisions in California, Arizona and Nevada, same wall together,” says Ragon. “There was
timber titans such as Weyerhaeuser, Hampton Affiliates and Roseburg Forest Products ap- no way to escape it.”
peared to be bouncing back, employing fewer people due to automation but still achiev- Roseburg, the largest city in Douglas
County, has never been a one-company
town. At its competitive peak, this tree-filled
county was home to 278 lumber mills. Most
of those have faded into history, but several
dozen remain, and with the diversification
of the economies of Eugene and metro Port-
land, Roseburg has emerged as the manu-
facturing center of the state’s timber indus-
try. “Timber is the dominant employer here
and most likely always will be,” says Debbie Allyn Ford, CEO of Roseburg Forest Products,
Fromdahl, executive director of the Rose- remains optimistic about the long-term forecast
for Oregon’s timber industry: “We’ve got the
burg Area Chamber of Commerce.
wood, we’ve got the technology, and we’ve got
But the industry has never been weaker. access to the biggest market in the world.”
As a result, Douglas County is struggling
with the highest unemployment rate in Or-
egon west of the Cascades.
Allyn Ford, CEO of Roseburg Forest
U
Products, Douglas County’s largest employ- nlike Oakridge, Roseburg has made significant strides to diversify its industrial
er and one of Oregon’s biggest private com- base. It is a much larger city, centrally located on I-5, with quality industrial land
panies, doesn’t expect improvement for at and an active community college offering workforce training. Ironically, Roseburg’s
least a year. “We are an industry that is built attempts at diversification have not held up any better than has the timber industry. For a
for 2 million housing starts and here we while the town hosted a robust boat-manufacturing cluster featuring a Bayliner plant and a
are at 500,000 or 600,000,” he says. “There homegrown company called North River that claimed to be the fastest-growing aluminum
is so much capacity that any time you get boat builder in the nation. But the Bayliner plant has shut down and North River has suf-
a little jump in the market, everybody just fered from a series of scandals that culminated with the September arrest of owner Brian
piles on. We’re all desperately trying to cre- Brush for allegedly killing his ex-girlfriend.
ate cash. And the people who are left in the Roseburg and Douglas County also went to great lengths to lure a Dell call center to town,
game are pretty tough people. So it’s tough he says. “You need really smart people, and only to have the computer giant close up shop in favor of cheap labor overseas in a man-
out there.” that’s what we’ve got. My guys are mechani- ner that inspires resentment to this day. On the morning of a morale-raising “wear your
Smaller companies such as 55-employee cal, they’re computer guys, they know how pajamas to work” day, employees showed up ready for a work party to find the front doors
Nordic Veneer, the sole operating mill on to design things, how to fix things. Most of locked and the operation apparently shut down. Terry Swaggerty, who served as Umpqua
Debbie Fromdahl,
the North Umpqua Highway east of Rose- them can do two or three jobs. That’s how Community College’s Dell recruiter, remembers that morning vividly. “We did back som-
executive director
of the Roseburg
roseburg
burg, are also struggling. Owner and gener- we’ve been able to survive.” ersaults for Dell,” he says. “For them to turn and bolt on us the way they did, it just left a bad
Area Chamber of al manager Art Adams retooled the mill 15 Others have not been so fortunate. The taste in a lot of people’s mouths.”
Commerce, is years ago to adapt to the loss of old-growth collapse of the market has devastated not Most of the economic success stories of Douglas County have been locally generated, such
working with timber from public lands, and he figures he’s only mills and mill towns but also ancil- as Umpqua Dairy, the sewage system developer Orenco and the growing empire of the Cow
other local surviving the downturn on grit and the qual- lary businesses that rely on wood products. Creek Tribe, which runs a casino and a dozen other businesses and employs about 1,500,
officials to ity of his team. “There’s an element of sweat “The whole infrastructure is impacted,” says more people than it has members. The VA hospital is a steady employer that won’t be going
diversify Douglas in this work, but you also have to be smart,” Ford. “You look at the people doing the log- away, as is Mercy Hospital. The local wine industry has also held up well and is poised to
County’s ging and the trucking and the service indus- expand significantly as a result of a string of major vineyard purchases and the Southern
economy. Still, she try that supports all of that and it’s all down. Oregon Wine Institute north of Roseburg.
believes timber
We normally do quite a bit of construction The combination of wine production and upscale tourism has worked wonders in the
will always be the
dominant
around here. We’re always renovating and Willamette Valley, but the Umpqua Valley is far from competing for those visitors. Local
local employer. tearing down things and building things. wineries do not offer overnight lodging, and gourmet food is the exception rather than
That’s all come to a stop.” the rule. One of the reasons people have been buying up land for wine cultivation is real
30 • Oregon
OregOn Business • NOVEMBER
NOVEMBER 2009
2009 NOVEMBER 2009 • Oregon Business • 31
rural economies
trouble in timber town
estate is cheap. The countryside is gorgeous oregon wood product manufacturing employment Ochoco Lumber mill.
but there is no destination resort other than 50,000
It marked the end of an era and the loss
a tribal casino and a safari game park. And of an annual payroll of $5 million when
the area is littered with large vacant prop- Ochoco closed its Prineville mill in 2001. By
40,000
erties that serve as lumbering reminders of then the company already had shifted jobs
the downfall of the industry that fueled the 47,600 to Lithuania, where it bought a mill in 1994,
30,000
town through better times. and transitioned from local production to
Helga Conrad, director of the Partner- global marketing. Now Ochoco is making
ship for Economic Development in Douglas 20,000 another transition — one that has noth-
County for 10 years, says it has been a chal- 21,300 ing to do with timber. The company has
lenge to find replacements for the highly 10,000 removed more than 4,000 tons of contami-
paid union jobs people enjoyed while the nated soil from its former mill and restored
mills were thriving. Among the missing at- 0 the Ochoco Creek to lay the foundation for
tributes she wishes she had to market are a 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 a multi-use commercial district modeled on
four-year university, a commercial airport, Sources: Oregon Employment Department, Qualityinfo.org the Old Mill District in Bend.
and a rail connection to the Port of Coos It’s a compelling model. After Bend’s mills
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Bay. ome 220 miles to the northeast, in Prineville, the landscape is different but the per- closed in the early 1990s, many observers
Given the mixed results in areas outside centage of publicly owned forestland is similar. Unlike Oakridge and Roseburg, Prin- predicted economic collapse. Instead, Bend
of wood products, timber executives argue eville was not built on Douglas fir. It was built on ponderosa pine. The city’s founding doubled its population and built a vibrant
that Douglas County, and the state of Or- fathers developed a short line connecting the town with the main railroad line through modern economy in which land values
egon for that matter, should embrace the Central Oregon, and before long rail cars crammed full of pine lumber were pouring out of soared. The mill’s old powerhouse was con-
industry upon which they were built. Crook County. The deal was so lucrative that the railroad paid for all city services and built verted into a Recreational Equipment Inc.
“Our industry is very dynamic and very the county its first courthouse. store in 2005.
solid,” says Ford. “There has been some drop A generation ago five large mills cranked out lumber in Prineville and logging was a com- Bend’s mills employed 1,800 at their
in employment and some drop in supply, but mon, high-paying job. Today logging has all but ended and the two mills that remain in peak. Today the Old Mill District employs
the demand for wood products is still there. Prineville are secondary job shops that have had to change radically to survive. 2,750. Not all of those jobs are full time,
Oregon is still No. 1 in lumber, plywood and Bob Horton, vice president of manufacturing for Contact Industries, which is headquar- much less union jobs, but they aren’t all low-
all wood products in the United States. And tered in Clackamas County but does its manufacturing in Prineville, says his company paid service jobs either. Bend has nurtured
from a technology standpoint we are world would not exist at all if it hadn’t moved from making commodity wood products to filling an impressive collection of local startups in
class. You walk into our mills, you’re walk- custom orders. “What we did was we leveraged our understanding of both wood technol-
ing into lasers, computers. We’ve got robots ogy and adhesive technology to redefine our product line,” he says. “At one time we were The railroad tracks that once brought
in our plywood plants now. I know the im- 90% commodities and 10% specialties. Now we have reversed that. We’re probably 95% prosperity to Prineville come to an abrupt halt
age is that it’s an old, dying industry. It’s not. specialties now.” next to the former Ochoco lumber mill.
Yeah, it’s been around for a while. But it’s not Much of Contact’s business involves slicing high-quality wood very thinly and wrapping
dying.” it around cheaper wood and also aluminum, to solve specific problems for architects on a
It frustrates Ford and other industry lead- job-by-job basis. “We’re the only people on the face of this earth that measure aluminum
ers that state leaders put so much emphasis products in board feet,” says Horton. “You can fight the commodities or find a niche. You
on solar and wind energy, when Oregon can listen to the green movement or you can ignore it. We listened.”
would seem to have a strong advantage in Nordic Veneer That strategy has enabled Contact to survive. But the local economy of logging, truck-
producing renewable energy from woody owner Art Adams ing, milling and distribution is gone. The railroad tracks that once symbolized Prineville’s
biomass. Another source of continual angst says he’s surviving connection to the outside world end abruptly in the middle of town, just short of the former
for the industry involves federal timber pol- the industry’s
icy, which appeared poised for change under slump on the
ingenuity of his 55
the Bush Administration only to stall out
employees. Bob Horton of Contact Industries
under President Obama. Timber support-
with one of the specialty
ers make the case that a combination of fire wood and aluminum products
prevention, increased harvest and biomass manufactured in Prineville.
development (in addition to carbon credits stay there. If our national forests were managed properly, the job losses would end and new
for planting trees) could restore Oregon’s mills would get built. But people need certainty to invest.”
forests as well as its economy. It remains to be seen whether federal forest policy will change, and if so, how. Another
“You look around this county and you’ll question involves how well a return to intensive logging on public lands would mesh with
see a lot of 50- to 60-year-old Douglas fir, simultaneous efforts to develop an upscale wine tourism industry. Not every business ben-
which happens to be one of the best build- efits from clear cuts and roads rumbling with logging trucks. Worth pointing out is that of
ing materials in the world,” says Ragon. “We the many vocational courses at Umpqua Community College, one of the least popular in-
PHOTOS BY BEN JACKLET
have been on the top of the competitive heap volved preparing students for jobs in the timber industry. It was offered for several semesters
of that market for 20 years and we want to but was eventually canceled due to lack of interest.
H
Source: Map courtesy of Oregon Dept. of Forestry U.S. Forest Service, Bureau of Land Management
Bend’s lead into real estate is hardly fool- arney County, which rivals Crook County for the highest unemployment rate in peutics. Business has been brisk, commu-
proof, as Prineville-based Community First Oregon, is set in a mesmerizing high desert landscape of endless sagebrush, with nity support strong, and other small break-
Bank found out the hard way. Community less than one person per square mile. It seems an unlikely setting for a timberland siana Pacific shutting down in the fall of 2007. Now that the RV industry has imploded and throughs are on the way just down the street.
First prided itself on investing 100% of its empire, given the lack of trees. But it was the biggest timber deal in the history of the U.S. taken the local Monaco Coach plant with it, Harney County is left with 10 manufacturing “A lot of people thought it was the end of the
local deposits back into Central Oregon. Forest Service that brought Illinois timber baron Edward Hines here in the 1920s. jobs officially, although the true number is probably closer to zero. It also has the highest world when the mill shut down,” she says. “I
Unfortunately, many of those investments Having secured a monopoly on 890 million board feet of publicly owned ponderosa pine percentage of public sector jobs of any county in Oregon. didn’t. They were really pissed off they were
unraveled when the housing bubble burst. forest north of town, the Hines Lumber Co. established the company town of Hines adja- In an effort to create new jobs, Grasty and the county are purchasing the former Louisi- losing their jobs, and I don’t blame them.
Prineville’s community bank failed in Au- cent to Burns and built one of the largest lumber mills in the world. With an unlimited sup- ana Pacific mill and looking for a buyer. Their plan is to hire a salvage company to clean out But for me, this is an opportunity. This is
gust, a casualty of a crisis that has cost thou- ply of trees to cut, no competition and a booming market, Hines could afford to pay good the old mill and recruit an established firm to restart the local wood industry through some something I can afford to be a part of.”
sands of realtors, mortgage brokers, con- union wages in the town he named after himself. combination of harvest, salvage, fire risk reduction, biomass and wood pellets. They also After years of watching her town struggle
struction workers and subcontractors their The market stalled during the Great Depression, but it returned with vigor following plan to use part of the property as an incubator space for promising local startup ideas from to replace Big Timber, Robson has conclud-
jobs in Oregon. World War II, and well into the ’60s, ’70s and early ’80s. When Harney County Judge Steve former mill workers and employees from the RV manufacturing plant that recently closed. ed that turning timber towns into some-
Brooks Resources, which led the charge Grasty came to town in 1971 to work at an auto parts store, he was amazed at how much “We will chase everything,” he says. thing else takes time, work and a whole lot
from timber to real estate speculation in money was floating around town. He thought he was living well on $350 per month, but Catching something won’t be easy. Bringing new jobs to a land as remote as Harney of small steps. It’s a lesson that applies to
Central Oregon, is also learning that which almost everyone he met was making 10 times that, logging in the woods north of town or County will always be a challenge. much of Oregon, which continues to wrestle
inflates can also burst. After big successes working at the mill. Fortunately for Harney County, ranching has fared better than timber. The ranching with an unemployment rate well above the
with the Old Mill District and the Black Butte “I’d seen people with money before,” says Grasty. “But I’d never been in a town where community has its own issues with public lands grazing restrictions and unpredictable national average, particularly in rural areas
Ranch destination resort, the timber spin-off everybody had money.” prices, but it has remained strong enough to keep downtown Burns in business, humming and especially in timber country.
has been hard-pressed to sell homes at its Iron In 1973, Harney County was the wealthiest county in Oregon as measured by per capita along with a vibe that is nothing at all like a ghost town — more like a friendly little place The economic forecast calls for a long, slug-
Horse project on the butte above Prineville. income. But more than 1,000 jobs vanished when Hines sold the mill in the early 1980s. where everyone knows everyone else. gish return to a downsized version of prosper-
The original plan called for 2,900 homes but Subsequent attempts to revive smaller iterations of the mill have been short lived, with Loui- “It’s the kind of town where you can walk anywhere you without worrying about being ity, with jobs in Oregon returning to pre-re-
sales have been sluggish. All three builders safe and let the kids ride their bikes free,” says Jan Oswald, owner of Gourmet and Gadgets, a cession levels somewhere in 2013. The forecast
who invested are offering discounts. kitchen supply store downtown. “No matter how things are, everybody helps everybody out.” for the wood products industry is even bleaker.
From 2000 to 2007, Crook County was Fran Davis, owner of the Broadway Deli down the street, adds: “If I can buy it in Burns, I Timber towns with sprawling industrial va-
the state’s second-fastest growing county, Harney County do. Every dollar that gets spent in this town comes back around.” cancies will be hard-pressed to attract major
Judge Steve Grasty
behind only Deschutes. No more. Median Certainly fewer dollars make the local rounds than in the mill’s heyday. But a steady employers to their former mill sites.
vows to “chase
home prices have dropped by about 40% everything”
trickle of tourists and truckers keep the wheels of commerce turning, and the annual bird Reinventing themselves as bedroom com-
over the past year in Crook County, and to revive local migration festival grows larger each year. Locally owned shops such as Grandma’s Cedar munities and tourist destinations will be chal-
with a local unemployment rate hovering industry. The Chest, Ribbons and Roses, Country Lane Quilts and the Tumbleweed Floral and Paper lenging. These towns will need all of the pub-
around 20% (the highest in Oregon), few recent closure Company have managed to keep their doors open. The community emphasis on buying lic resources they can get and all of the locally
are expecting a recovery in the local market of an RV factory locally to help each other out has helped pull new shops such as Harney County Clothing grown ingenuity they can muster, whether
anytime soon. leaves Harney and the Children’s Barn through the worst of the recession. it’s public servants such as Steve Grasty chas-
So what’s next? County with no ing everything to create a few jobs in Harney
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Ask Jason Carr that question, and he reels manufacturing. imilar green shoots can be found in Oakridge at the Trailside Café, at the Willamette County or wily timber veterans such as Bob
off a long list of possibilities ranging from Mercantile Bike Shop, at a building being remodeled into a hostel for cyclists, and at the Horton and Allyn Ford developing new strat-
data server farms and wind power to plas- concerts in the park organized by Vivian Erickson, co-owner of the Oakridge Motel. egies to diversify the industry itself.
tics manufacturing and higher education. Mountain Bike Oregon sold out in August, bringing in 300 people from as far off as Perhaps most vital to the future of Or-