February 5, 2004, Los Angeles Times, False Data Led to Logging Deal, Ex-Official Says, by Kenneth R. Weiss,

February 5, 2004, Los Angeles Times, False Data Led to Logging Deal, Ex-Official Says, by Kenneth R. Weiss, Times Staff Writer, 

Former forestry chief says Pacific Lumber Co. won his approval of the Headwaters accord by understating the danger of landslides.

The former director of the California Department of Forestry, bolstering a civil fraud case against Pacific Lumber Co., says he would have withheld approval for the $480-million Headwaters forest deal in 1999 had he known then that the firm had submitted false data on the danger of landslides from its logging operations.

In the Headwaters transaction, the state and federal government protected several thousand acres of ancient redwoods in a complex transaction that involved paying Pacific Lumber as well as approving the company's plan to log extensively elsewhere on its north coast property.

The Headwaters deal capped a decade-long battle to save the state's remaining stands of giant redwoods not protected in parks or preserves.

In a court declaration filed Wednesday, former forestry Director Richard Wilson lent support to an embattled district attorney's charge that Pacific Lumber submitted false information about the impacts of logging operations on fragile terrain in its efforts to secure the Headwaters deal.

If he had known that the company had underestimated the tendency of its logging operations to promote landslides, Wilson said, he would not have signed off on a deal that permitted more logging in areas prone to landslides.

Wilson's declaration comes at a critical time for Humboldt County Dist. Atty. Paul Gallegos, who became the target of a recall attempt as a result of the charges he brought against Pacific Lumber. The company, a major employer and political force in the region, has been bankrolling the March 2 recall campaign.

Gallegos' office issued a news release Wednesday detailing Wilson's declaration, prompting a sharp rejoinder by Pacific Lumber, which calls itself Palco.

"This stunt, in the midst of litigation and the recall ... smacks of a political vendetta driven by headline seeking instead of truth finding," the company said in a statement.

The fraud case centers on information that Palco submitted to state officials contending that its proposed timber cutting would have little effect on landslides or on mud flows that can harm streams used by spawning salmon and foul the water supplies of downstream neighbors.

According to the lawsuit, the company sent data in 1999 showing that only 15% of landslides in one watershed, called Jordan Creek, had resulted from timber harvesting within the past 15 years. The district attorney contends that the company used this incorrect information to alleviate concerns about future landslides and to persuade Wilson to allow more logging on unstable slopes.

Later, Palco corrected the information in a report given to the forestry department's tiny Fortuna, Calif., field office. The new information showed that 60% of landslides in Jordan Creek had come from recently harvested areas.

Wilson said Wednesday he had never been made aware of Palco's corrections, which did not appear in a final environmental impact report on the likely effects of Palco's logging plans.

He said the new information was significant enough that he would not have approved the company's plans on how much timber it could harvest over the next decade. In the years leading up to the deal, Wilson's department twice suspended Palco's license to cut timber because of numerous violations of the state's Forestry Practices Act.

Assistant Dist. Atty. Tim Stoen said Wilson's testimony would be important in proving the fraud case, which alleges that Palco had "unjustly enriched" itself by harvesting $40 million more worth of trees every year.

Douglas Wheeler, who was California resources secretary at the time and Wilson's boss, disagreed. "There were no dramatic revelations," he said in reference to Palco's corrected data.

"Even if the information had been made available, it wouldn't have changed the outcome," said Wheeler. "I believe then and I believe now, that the Headwaters was an important deal."