U.S. Senators ask Legislature to keep Montanans working in the woods

Baucus, Tester shepherd Jobs Bill money to boost wood products industry

(WASHINGTON, D.C.) – After Montana Governor Brian Schweitzer honored their request to use money from the recently passed Jobs Bill to boost Montana’s wood products industry, Montana’s U.S. Senators today urged state lawmakers to follow suit.

Senators Max Baucus and Jon Tester played key roles in writing and passing the Jobs Bill, formally known as the American Recovery and Reinvestment Act.  The measure, signed into law on February 17, is cutting taxes and creating thousands of Montana jobs by pumping at least $626 million into state infrastructure projects, education and health care.

In a letter sent earlier this month, Baucus and Tester asked Schweitzer to use several million dollars of Montana’s discretionary Jobs Bill money to create a revolving loan fund to keep afloat Montana’s timber industry.  Montana’s wood products industry has been decimated by the nationwide housing crisis, threatening thousands of jobs and dozens of mills.

“The public has a compelling interest in preserving the forest products industry,” Baucus and Tester wrote.  “Timber related businesses create good-paying jobs, and those businesses are necessary to manage the timberlands in Montana.”

After receiving the letter from Baucus and Tester, Schweitzer proposed setting aside up to $10 million to create a revolving loan fund for Montana’s wood products industry.  State officials are also considering adding more from other federal sources.

Now Montana lawmakers must pass legislation to finalize how and where Montana’s share of Jobs Bill money will be invested.

“Creating a revolving loan fund to keep Montanans working in the woods is a major step forward,” said Sherm Anderson, owner of Sun Mountain Lumber in Deer Lodge.  “It takes sitting down with folks in Montana and working together to make it happen.  And we appreciate Max and Jon standing up for Montana’s wood products industry.”

The Senators’ letter to Schweitzer appears below.

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The Honorable Brian Schweitzer
Governor
State of Montana

Dear Governor Schweitzer:
 
As you know, Congress granted the States broad authority to use 18.2 percent of the State Stabilization Fund established in the recently enacted Jobs bill – formally known as the American Recovery and Reinvestment Act (P.L. 111-5) – to meet particular challenges facing them during this economic recession.  The statute reads in pertinent part, “The Governor shall use 18.2 percent of the State’s allocation under section 14001 for public safety and other government services….”   In our view, Congress provided minimal direction in order to ensure that States have as much flexibility as possible to respond to the needs of their residents.

We believe that establishing a state administered revolving loan fund to preserve and create jobs in Montana’s wood products industry is an appropriate use of this money.  We have directed our staffs to work with Commerce Director Preite and others to develop a plan for establishing and implementing this revolving fund so that, if approved by the legislature, such a fund can immediately work to preserve and create jobs in this important sector of Montana’s economy.

As you are aware, a recent study funded by the Montana Department of Commerce and conducted by the University of Montana has concluded that a multi-faceted and coordinated stabilization program, including a revolving loan fund, could retain at least 771 direct jobs and create an additional 397 direct jobs over the next two years.  We are at a critical juncture for the Montana wood products industry.  Several Montana mills have closed in recent months, and the remaining mills are running curtailed schedules.  Lumber prices remain at or near historic lows just as demand plummets for paper products.  We believe that it is critical at this time to make a strong commitment to preserving the industry through dedication of public resources.

As you consider where the more than $600 million that Congress has provided to Montana will be invested, we continue to work with the Montana Department of Commerce to identify other resources to help us retain this indispensible industry.  The U.S. Economic Development Administration, USDA Rural Development, State of Montana programs, local development resources, private investment, and bank lending are all necessary components of this effort.  Yesterday our offices met with the regional director for the Economic Development Administration, and we will support a request from the Montana Department of Commerce for a $2.7 million Economic Adjustment grant dedicated to saving wood products jobs.
 
The public has a compelling interest in preserving the forest products industry.  Timber related businesses create good-paying jobs, and those businesses are necessary to manage the timberlands in Montana.  We appreciate your commitment to working with us on this urgent issue, and we thank you for your leadership during these difficult economic times.

Sincerely,
(s)
Max Baucus
Jon Tester