There is good news coming out of Coos County's fiscal arena.

And, believe it or not, it's connected to timber.

Last week, the Coos County Board of Commissioners was informed by Coos County Forester Bob Laport that at its annual spring timber auction, the county would be paid $3.8 million for the sale of 220 acres, or 9 million board feet, of timber.

The amount was $600,000 more than its appraised value, of $3.2 million.

“We were pleased,” said Laport. “The commissioners were pleased.”

Every year, a portion of the 15,000 acre Coos County Forest's sustainable timber yield is advertised for sale, auctioned off in early spring by a sealed bid process and later harvested by timber companies.

The money collected from the timber sales is put into the county's general fund. Since its creation in the 1940s, the Coos County Forest has accounted for anywhere from 1 percent to 24 percent of the county's general fund budget revenues. But with the expiration of the federal timber payment subsidy - which sent $7 million to Coos County last year - the county timber receipts stock has risen dramatically.

“It used to be about a quarter of (our general fund). Now that the federal timber money is gone - it's actually half of our remaining discretionary general fund,” said Coos County Board Chairman John Griffith. “It's a good thing that the county has a county forest.”

Both Griffith and Commissioner Nikki Whitty said they expect the total sale price to exceed the appraised value. However, Griffith said there is always some concern that goes along with whether or not companies will bid on the timber, and also if the bid prices will be adequate.

The county has the option of rejecting all bids if the prices are too low.

There were five timber sales this year: one in the county's smaller Daniels Creek forest block, and the other four scattered across the Beaver Hill area, just south of Coos Bay. The companies that purchased the timber are CLR Timber Holding Inc., of Brookings; Georgia-Pacific in Coos Bay; Swanson Group, of Glendale; and the Seneca Saw Mill Corp., of Eugene.

“We had a lot of good interest - several bidders on all the sales,” Laport said, noting he thinks low inventories bolstered interest, despite a slumping housing market nationwide.

About 60 percent of the upcoming harvest will consist of Douglas fir, with most of the remaining harvest being spruce. None of the trees is older than 80 years. The timber companies have 18 months to hire contractors and remove the timber, Laport said.

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The money from last week's auction doesn't mean there will be one lump payment of $3.8 million into the county's discretionary general fund any time soon, Laport said. Timber companies can make payments on the timber over time. Furthermore, to prevent wide-ranging fluctuations in timber revenues from year to year, in 2000, the Coos County Forest Fund consisting of a five-year rolling average of timber sales was established.

The fund came about after timber sales peaked in the mid-1990s, amassing record bid prices of $1,000 per 1,000 board feet of timber. Timber companies were in tight competition with one another at the time after the Northwest Forest Plan drastically curtailed logging in the Pacific Northwest.

“We just had this unbelievable spike,” Laport said.

But a few years later, with many of those timber companies no longer around, prices started to plummet creating a crisis in the budget making process.

“It was like ‘My God, what are we going to do?'” Whitty recalled of the year barely any bids came in. “It scared the bejeesus out of us.”

Timber bid prices change depending on variable world market forces. Prices have continued to drop. Last week's top county bid came in at $529 per 1,000 board feet of timber. Without the forest fund, Whitty said, the county had an impossible time figuring its budget. At the behest of Laport, they established the Forest Fund to create stability and now with the five-year rolling average, the commissioners have a manageable figure to plug in year after year.

Griffith said while the county does not have the money now to buy additional timberlands, it could, one day, if the county's deal with Methane Energy Corp. proves a success. The county has leased about 30,000 acres of mineral rights to the Coquille-based company, which is in the exploratory stages of extracting natural gas south of Coos Bay. Griffith said he county stands to gain one-eighth royalties from the gas extracted from its leased mineral rights.

To see graphic of timber sale locations click here.