County looks to tighten reserve cap on forestry department
Taylor County is taking steps to make perception match reality when it comes to forestry department revenues and carryover funds.
Unlike many other branches of the county government, the county forest has historically generated more revenue than its operating costs. In good years, when stumpage prices have been high, the revenue can end up being significantly more than operating costs.
While these revenues have always been considered to be county funds and has been tapped into by the county finance committee in shaping the annual budget, the perception among some on county board and elsewhere is that this was money primarily controlled by the forestry department and the members of the oversight committee.
County finance director Larry Brandl wants to change that perception. At the April 2 forestry committee meeting he presented a plan to formally cap the forestry department reserve funds at the amount budgeted for the current year’s operating budget along with some additional designated carryover accounts for road maintenance ($25,000), replacement of the department’s ATV ($2,000), vehicle replacement ($10,000) and outlay of heavy equipment.
In 2018, the county had capped the funds after the department reserves had swelled to over $800,000 with the cap placed at about $350,000, last year the department ended with $332,00 in carryover. The 2021 budget calls for $164,297 in spending for the forestry department. Under the change proposed by Brandl, and supported by committee chairman Chuck Zenner, the carryovers would be capped at about $201,000.
In essence, this would allow the department to operate on its reserves alone for one year if there were no revenues, this is done as a cushion because of the fluctuating nature of the timber markets.
Forest administrator Jake Walcisak suggested that as an additional level of transparency, it would be better to bring the designated carryovers onto the front side of the budget as designated expenses.
Brandl said for the budget to balance, they would need to bring up timber revenues in order to do that, which would have the impact of increasing the department’s budget, at least on paper. “There are pros and cons,” Brandl said.
Taylor County is hoping to get in writing a verbal agreement reached with Ayres Associates over the company’s error in applying for a dam grant through a state program in 2020. The engineering firm had not sent the completed plans in by the set deadline costing the county points on the grant applications for the Camp 8 and Chelsea Lake Dam projects.
After going back and forth on the issue, county representatives and representatives from Ayres met last fall to reach an agreement. Under terms of the agreement reached, the county is requesting Ayres pay for the estimated $30,000 in inflationary increases due to the two-year delay in the reconstruction projects as well as a refunding of the $2,500 application fees for the grant applications.
Committee members remain hopeful the project will qualify for grant funding when they are able to resubmit in 2022, but are leaving open potential future action if the dam projects are not funded by the grants. The letter dated March 24 from assistant corporation counsel Ruthann Koch puts into writing the agreement reached at the September meeting.
At Friday’s meeting, committee members questioned what would happen to the dams if they were not funded by the grant program. Walcisak said that no matter what, Chelsea Dam would be replaced. However, the motion on the Camp 8 dam project was contingent on getting the grant.
“If we don’t get the grant for Chelsea we would move forward with the current design,” Walcisak said, noting there would then need to be a tough conversation about the future of the Camp 8 dam.
Walcisak noted there is little risk of immediate dam failure at Camp 8 and that there was some distance between the dam and the nearest structure. He also reminded the committee that Camp 8 actually scored more points in the grant program and was ranked higher for funding than Chelsea did.
“I guess we will have to cross those dams when we get to them,” Zenner said.
As far as the letter to Ayres Associates, Zenner said he hoped it would not be needed. “If the grant goes through this is a moot issue, if not we have some protections in place,” he said.
In other business, committee members:
_ Closed out timber sales 662, 687 and 690.
Timber sale 662 was a red pine sale by Bell Timber for trees used for utility poles. The sale generated $87,158.33 in stumpage revenue on the 30-acre sale.
Timber sale 687 was a direct sale for eight acres by Czarnezki Forest Products. The sale generated $2,979 in stumpage revenue. This was described as a “clean up” sale with area missed from other sales.
Timber sale 690 was by Gumz Logging and is a sale that was less than a year old and was set up with the help of the DNR. It generated $107,671.76 in stumpage revenue.
Assistant forest administrator Jordan Lutz noted this was the county’s most productive first quarter in the past few years, but cautioned that many other county forests are struggling as loggers have to travel to find markets for their lumber due to mill closures. He said this was greatly helped by the red pine sale.
_ Approved piggybacking on a state bid for the replanting of a white spruce plantation to red pine. Work will involve disk planting rows and spraying to eliminate competing species. Migrant planter crews will be hired to plant the trees in the spring of 2022. The costs are covered under a sustainable forestry grant. Walcisak said it would be difficult for the county to get interest in a bid based solely on its project, noting there are specialized companies that handle this type of work and who start in Florida in early spring and end in Canada in late spring as they following the planting season. He noted that the migrant planters with work visas typically get paid about five cents for every tree planted and are expected to plant about 2,000 seedlings a day.
Approved awarding a gravel bid to Randy Thums for 1.25 inch crushed gravel and 2-inch crushed gravel to Randy Thums Trucking at a bid price of $33,100. There was a question if Thums could maintain the five-truck minimum in the bid specifications with the committee saying if that was an issue they would revisit it at the next month’s meeting. Thums was actually the second lowest bidder on the project with Wisco Materials the low bidder among five firms submitting bids. Wisco had a bid of $27,408. However, Walcisak advised the committee to not award the bid to Wisco based on previous material not meeting specifications and work not being up to contract standards.