The Forest Service was going to save us from wildfires.
But it’s time to come up with a backup plan.
The Forest Service’s Request for Proposal (RFP) negotiations had been on and off life support for the past 18 months.
But now the Forest Service has canceled the RFP for the second phase of the massive Four Forest Restoration Initiative (4FRI).
The Forest Service vowed to start over, after failing to come to terms with two serious bidders who each spent hundreds of thousands of dollars jumping through the bureaucratic hoops of the process.
The negotiations reportedly floundered on a lack of a market for low-value biomass and an investment guarantee in the event the Forest Service couldn’t hold up its end of a 20-year contract.
“Overall, the government’s conclusion is that the requirement for meeting restoration objectives (as currently defined in the RFP) are not reasonably aligned to industry needs. In addition, significant financial and investment risks remain, which ultimately represents a performance risk to the government,” 4FRI CFO Jeremy Kruger said in a press release this week.
“The Forest Service recognizes all the time and effort that went into this RFP from all parties. We are deeply invested and our intention is to work with our partners together on a new proposal as soon as possible. Our next step is to regroup with our partners, stakeholders, industry and elected officials to discuss all we have learned and how we can move forward.”
The collapse of the negotiations drew swift, fearful and outraged reaction.
“The failure jeopardizes the health of our forests and the safety of many Arizona families, businesses, and communities,” said Congressman Tom O’Halleran, whose district includes the White Mountains and southern Gila County. “The Forest Service has had more than enough time to work through the challenges, even issuing 11 amendments. It is disappointing that the Forest Service isn’t doing more to reduce the risk of catastrophic wildfires with the authorities and resources that Congress has provided to improve forest management, help prevent forest fires, and minimize severity of wildfires.”
In the first phase of the 4FRI effort, the Forest Service has spent more than eight years trying to find a contractor who could thin up to 50,000 acres of overgrown forest annually. That contract involved some 500,000 acres, mostly near Flagstaff. The series of contractors selected never thinned more than about 1,500 acres a year.
The second phase contract for 500,000 to 800,000 acres further east were supposed to apply the lessons learned from the first, futile contracts. But after nearly two years of effort, the negotiations collapsed.
In the meantime, wildfires have exploded throughout the West. Arizona’s ponderosa pine forests have increased in density from about 100 trees per acre to more like 1,000 trees per acre, creating a tinderbox forest that threatens the survival of forested communities like Payson, Pine, Show Low and Pinetop as well as the reservoirs and watersheds that sustain the 4.5 million residents of Maricopa County.
This year in Arizona more than 600,000 acres burned. Last year, wildfires claimed nearly a million acres. The 4FRI process represented the best, large-scale hope of dramatically reducing tree densities across nearly 6 million acres.
But the failure of the latest 4FRI negotiations could have a silver lining, said Brad Worsley, head of the Novo Power biomass power plant in Snowflake. The biomass burning power plant has remained the key to thinning efforts in the White Mountains that have treated about 16,000 acres annually, mostly outside of the 4FRI process.
“Perhaps we can go back to some of the strategies we were trying to implement — and that were gaining traction,” said Worsley, who was involved with the RFP negotiations and would have provided a market for some of the biomass for the two final bidders. “There was no alternative solution when the RFP was sucking up all the available resources.”
He said it surprised him the negotiations finally collapsed after 18 months of discussions over the fundamental issue of whether the Forest Service would at least guarantee the contractors’ investment if it couldn’t deliver enough wood.
“I was floored this morning. If they were going to pull the RFP — why not pull it 12 months ago? They essentially said, we can’t live up to our contract — and we’re unable to guarantee the capital money it takes to build these facilities. I’m not even sure why they started the process. If this material was so valuable a bidder would walk in without a guarantee — then somebody would have done it by now.”
On the other hand, the collapse of the 4FRI negotiations at least opens the door to other solutions.
For instance, Novo Power can burn enough wood slash and biomass to support 16,000 acres of thinning projects annually. The existence of the plant, several small-wood sawmills and a network of companies that can undertake forest thinning projects has sustained a logging industry in the White Mountains. It also made possible thinning projects that saved Alpine and Springerville from destruction by the Wallow Fire.
Worsley said the state, environmentalists, local logging firms, the Forest Service, Novo Power and others were talking about how to collaborate to solve the problem until the Forest Service RFP process essentially shut down those conversations, by requiring contractors to sign nondisclosure agreements when it came to discussing the bids.
One of those bids involved construction of a small-log sawmill. The other involved building an Oriented Strand Board (OSB) plant to produce high-tech plywood and composite wood products. Those new operations could have used a portion of the biomass that now only has value in generating electricity. This could have perhaps boosted the acres treated to about 30,000 — still far short of the originally envisioned 50,000.
Now, the focus will have to shift back to local industry, a biomass mandate by the Arizona Corporation Commission and other solutions. Novo Power’s hoping Arizona Public Service (APS) and Salt River Project (SRP) will at least extend their contracts to keep Novo Power in business by extending existing contracts to buy power generated by burning biomass.
“So I think the discussion needs to go backwards — back to the future,” said Worsley. “I’m comfortable with that scenario. If APS and SRP don’t want to renew the contract — that certainly ends Novo Power. But we no longer have the RFP — for good or bad — as a reason to delay. It’s time to make the decision. But we’re certainly looking at doing no better than we’ve done in the past — I’m not sure if that’s a win or a loss.”
Jeremy Kruger, chief executive of the Four Forest Restoration Initiative at the U.S. Forest Service, vowed to keep working to find a way to make 4FRI work. “We look forward to working on the critical, large-scale restoration vision of 4FRI and continuing our work to reduce the threats of destructive wildfire. But until the underlying risks to offerers and the government are better addressed, there is no reason to expect an outcome from the current RFP process that will meet the needs of the Forest Service.”
The cancellation will likely provoke a harsh response from Congress, with millions of acres on fire across the West this year — and no end to the holocaust in sight in states like California.
“The Forest Service’s failure to continue the contracting process slows restoration work in the 800,000 acres that would be addressed under the contract, jeopardizes forested communities and wrongly passes up an opportunity to create new, rural jobs. Restoration work at scale is critical for Arizona,” O’Halleran said.
This is the first in a series of articles about the efforts to reduce the risk of catastrophic wildfires in Rim Country and the White Mountains through forest restoration efforts.