Your Tax Dollars Not At Work

Article by Rich Donnell, Editor-in-Chief, Timber Processing March 2023

You may be aware of our affiliate magazine, Panel World, which covers the structural and non-structural wood panel industries in a similar way that Timber Processing covers the lumber industry.

Recently in Panel World we ran a news article on Huber Engineered Woods pulling out of a long-planned project to build a $440 million oriented strandboard (OSB) plant in Cohasset, Minn., which would have been Huber’s sixth OSB plant following ongoing operations in Maine, Georgia, Virginia, Tennessee and Oklahoma.

But this time Huber ran into the Leech Lake Band of Ojibwe, which collaborated with the Minnesota Center for Environmental Advocacy (MCEA) to cause Huber to back off the project. MCEA, in looking at its web site and personnel roster, is all about finding “environmental justice” through the courts in representation of various clients, such as Leech Lake Band of Ojibwe, whose land base is the Leech Lake Reservation in north-central Minnesota. The tribe operates three nearby gaming casinos and owns two gas express and food stations.

Though it’s a panel mill project, paying close attention to its developments and roadblocks may prove enlightening to sawmillers looking to build a plant down the road.

Huber, which first announced it wanted to build the plant in June 2021, bowed out in response to a Minnesota Court of Appeals decision in early February that would have caused further delay in the construction of the operation, which would have created 150 direct jobs and positively impacted hundreds of others in logging, trucking, supplies and numerous retail sectors.

But in the ruling on an appeal from the Leech Lake Band of Ojibwe (whose reservation is due west) and the Minnesota Center for Environmental Advocacy, the court of appeals said the Cohasset city planners’ earlier decision to only require an Environmental Assessment Worksheet (EAW) of the project, and not require a more detailed Environmental Impact Statement (EIS), needed to be readdressed by the city because of issues involving 10 acres of two “public waters wetlands” that the court said state law would require an EIS for. (The state of Minnesota requires a “responsible governmental unit,” such as a city planning body, to determine if a project requires an EAW or EIS, or both.)

Huber had initially submitted an EAW and then, at the city’s request—including providing more information about the health of Minnesota’s forests and their ability to sustainably supply the facility, and providing more detail on the project’s carbon footprint and the carbon sequestration effects of the finished wood products—re-submitted the EAW, which the city accepted while deciding an EIS wasn’t necessary.

Leech Lake Band appealed, and the appeals court agreed that the facility “falls into categories” for which an EIS is mandatory under Minnesota law, specifically as to the “elimination” of public waters wetland.

The court noted that the state’s definition of public waters wetlands is 10 or more acres in size in unincorporated areas and at least two and a half or more acres in incorporated areas. Huber’s EAW explained that its project would involve filling portions of two public waters wetlands, both in incorporated areas: 8.73 of 14.27 acres in one and 1.65 of 5.67 in another, and that while there would be a reduction in the size of each, it wouldn’t “eliminate” the public waters in question. The city agreed and noted that the partially filled public water wetlands would not fall below the 2.5 acre threshold after the partial filling.

The appeals court, however, said the state law did not explain what it means to “eliminate” a public waters wetland, and took the liberty to base its ruling that “eliminate” can also mean to “modify” public waters wetlands, and ruled that because the project would alter the characteristics of the public wetlands the city should apply this legal standard and re-assess whether an EIS is necessary.

The Leech Lake Band also said the project needed an EIS because the wetlands Huber planned to fill are a filter for water quality that nearby wild-rice beds depend upon. The court agreed, noting the city did not investigate or explain how wetlands replacement (as the project would entail) or stormwater controls would protect the wild-rice bed and other resources downstream.

The court said the city should reconsider given these rulings and then issue a revised decision on the need for an EIS. Huber’s withdrawal means such an exercise won’t be necessary.

The project would have replaced lost jobs and tax base as the adjacent Boswell coal-fired energy plant shuts down its coal burning units and possibly reconfigures to renewable energy sources.

An important note: The appeal from Leech Lake Band also asked the court to weigh the environmental effects potentially caused by air emissions from the new OSB plant. And asked the court to consider the volume of timber harvesting the new plant would require, saying it would be far more timber than the region can sustain with significant negative effects on wildlife and fisheries.

The city had determined there would be no significant environmental effects from either, given the air emissions permitting requirements and the forest sustainability data offered up by the city and Huber, including the point that even after the plant were to go into operation, regional forests would still continue to experience substantial net growth compared to harvest. The appeals court ruled in favor of the city as to “no significant environmental effects” and against the Band and the Minnesota environmental group.

In reading through the appeals court decision, you get the impression that somebody was throwing darts to see what sticks. In this case, air emissions and timber harvesting didn’t stick, but several acres of public waters wetlands did. This approach is nothing new to our industry (hello Northern Spotted Owl), but when it happens it’s always impossible to believe—good communities that need the economics take the hit.