Not One Dollar More

CascadeNewLogoBy John A. Charles, Jr.

The State of Oregon will sell 84,000 acres of the Elliott State Forest by March 2017, in order to make money for public schools.

However, the lands will not be auctioned to the highest bidder. In fact, they will not be auctioned at all. The State will set the price based on appraisals, and purchasers will pay that price.

If there is more than one offer, the tie will be broken based on which buyer promises the most “public benefits.” Those benefits are defined as public access to at least 50% of the property; preservation of old growth timber; protection of stream corridors; and the guarantee of at least 40 jobs for 10 years.

Evaluating competing offers promising “more jobs” versus “wider stream corridors” will be entirely subjective—in essence, a beauty contest. At a meeting last month for prospective buyers, the Department of State Lands was asked about the possibility of simply offering a higher bid. They responded that if someone bid even $1 over the appraised value, it would be deemed a “non-responsive” offer and rejected.

Prospective buyers were stunned. The timber is likely to be worth somewhere between $300 million and $450 million, and a high bid could really help schools. But for the State Land Board, price doesn’t matter.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Posted by at 05:00 | Posted in Environment, Natural Resources, Oregon Government, State Budget, State Government | Tagged , , , | 2 Comments |Email This Post Email This Post |Print This Post Print This Post
  • thevillageidiot

    this is how well the state runs a business. million dollar losses annually and they call it the best they can do. The sale is a one time cash infusion with no future. once it is gone it is gone. some real company will make money for the share holders for an indefinite period of time adding up to much more that 450 million over time years. 450 million hardly pays the school funding for one year. Might as well give it to the Federal government who will manage it for even bigger losses. but wasn’t that the primary reason for Malheur?

  • fred291

    This is like having the DEQ set prices on transferable tax credits: at best wasteful, at worst an opportunity for making political payoffs, rewarding friends and punishing enemies. See “Transferable Tax Credits: 3 Taxpayer Lessons From Oregon’s Debacle”

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