Land Swap to Preserve Old Redwood Forest Takes Root

The Headwaters forest on this fog-shrouded coast may not be the grandest or its terrain the most breathtaking. But in the California logging wars, it has achieved almost mythic status as the last unprotected stand of ancient redwoods on Earth.

Now the Clinton administration is backing an election-year land swap deal that would save most of the oldest and biggest trees from chain saws and, officials hope, end one of the nation’s longest and ugliest environmental conflicts.

With the likes of junk bond impresario Michael Milken on one side and the radical environmental group Earth First! on the other, Headwaters has become a symbol of Wall Street excess or of lawless activism, depending on your point of view.

Blocking logging roads and chaining themselves to trees, tie-dyed environmentalists waged “Redwood Summer” over the forest. Their chief adversary, Texas financier Charles Hurwitz, took control of Headwaters in 1986 and has made plain his intention to cut down the biggest redwoods over the next decade.

The lengthy battle over Headwaters came to a head this year when Hurwitz--who acquired the family-run Pacific Lumber Co., which had left many of the big trees untouched--filed a lawsuit seeking hundreds of millions of dollars from the state and federal government for allegedly interfering with his right to harvest the rare redwoods, which can be worth as much as $200,000 each as lumber.

The Clinton deal, developed with California Gov. Pete Wilson, would avoid a risky courtroom showdown. Besides ringing the death knell for Headwaters, a ruling in Hurwitz’s favor could sharply curtail government’s ability to stop environmentally harmful activity on private land anywhere.

As of now, the proposed swap for Headwaters would allow up to 7,000 acres to pass into the public domain, where it would be off limits to logging. In return, Pacific Lumber and Hurwitz would receive valuable forest land in Northern California and surplus military land with commercial real estate potential in Texas and elsewhere.

The exchange, which is still being negotiated, would assure the survival of the last privately owned piece of a majestic redwood forest that once extended from the Oregon border to Big Sur. California’s coastal redwoods are the tallest trees in the world, but the true giants are found on only 4% of their original range.

Many wildlife biologists believe that Headwaters is vital to the survival of creatures such as the endangered northern spotted owl, the marbled murrelet, a small sea bird that nests in old-growth forests, and coho salmon, which spawn in forest streams.

“The president would very much like to protect old-growth forests like this one,” said John Garamendi, the Department of the Interior deputy secretary who is in charge of the Headwaters negotiations for the administration. “While I do not underestimate the potential snags to an agreement on Headwaters, I feel optimistic about reaching an accord within the next few months.”

The Headwaters became a cause celebre in the mid-1980s when a hostile takeover of Pacific Lumber Co., the firm that had owned most of the forest for more than a century, led to a rapid increase in logging.

The highly leveraged purchase of Pacific Lumber was done with junk bonds in a deal involving Milken. To pay off the indebtedness, Pacific Lumber’s new owner, Hurwitz’s Houston-based Maxxam Inc., announced that all of the old-growth redwood would be cut by 2007. That announcement triggered a blitzkrieg of opposition.

The takeover was skillfully portrayed as an example of rapacious capitalism that would victimize not only trees and forest creatures but jobs as well--once all the giant redwoods were cut and milled. With a barrage of lawsuits on behalf of the marbled murrelet, environmentalists succeeded in placing much of the old-growth redwood temporarily off limits to logging.

Some of the oldest trees have been around for 1,000 years, since before the first foundations were being laid in many of Europe’s great cathedrals. And while the Headwaters is probably too inaccessible and its terrain too rough to qualify for park status, many people have come to regard it as a holy place.

“If it didn’t have a spiritual significance to people, we would never have seen such a crusade to save it over the years,” said Terry Gorton, who heads the state Department of Forestry. “Scientifically speaking, it represents the only forest habitat type of its kind still in private hands and California shouldn’t lose it.”

Ironically, not many outsiders have seen the trees they want to save. The forest didn’t even have a name until the 1980s when environmentalists decided that rescuing it from anonymity was the first step in saving it. They named the forest for its location near the origin of two small streams.

Over the years, about the only people to visit Headwaters, besides Pacific Lumber employees and their guests, have been government officials and trespassing activists.

The easiest way in--and the only legal access--is through a padlocked Pacific Lumber Co. gate and down a bone-jarring dirt track. The road plunges past acres of pampas grass and through stands of alder, Douglas fir and madrone trees into the still, damp recesses of the oldest growth. Known as the Headwaters Grove, this glen is the main focus of the administration’s acquisition plan.

Here along the steep sides of a fern-choked creek are dozens of the Headwaters’ biggest, oldest trees. Growing at a slightly higher altitude, they are not quite as tall as the giants that sprung from alluvial soil nearer sea level. Still, they have grown close to 300 feet tall and 10 feet thick.

Through the centuries they have been scorched by fire and clawed by bears. But the blemishes they wouldn’t be able to survive are the slashes of blue paint on their trunks that mark them for future harvest, in the event that the government does not acquire them.

By creating a sanctuary in the heart of one of the nation’s most celebrated forests, the Clinton administration also hopes to defuse some of the rage it kindled last year when it approved a salvage logging law that exempted substantial timber cutting operations on national forests from environmental challenges.

“The administration obviously blew it with the salvage law,” said Chuck Powell, an activist who lives nearby. “Headwaters is one way to make amends.”

But government negotiators don’t have a lot of time to complete a deal for Headwaters. A loophole in the logging restrictions would allow salvage logging by mid-September in the Headwaters Grove and other old-growth enclaves.

The main purpose of salvage logging is to remove the most flammable wood from forests where there is a high fire danger. However, live trees are often cut and wildlife habitat disturbed during salvage operations. Under the law passed last year, environmentalists are blocked from going to court to try to stop salvage logging that they think goes too far.

So far, environmental groups have expressed only tepid enthusiasm for the Clinton-Wilson Headwaters plan to protect 7,000 of the forest’s 76,000 acres. The Sierra Club and a coalition of groups contend that the government should acquire 60,000 acres to ensure the survival of the marbled murrelet.

The solution that environmental groups prefer would force Hurwitz to relinquish a large chunk of Headwaters to help square a debt to the federal government for a $1.6-billion bailout of a Texas savings and loan that collapsed in 1988. Federal banking regulators are suing Hurwitz for his alleged role in the failed thrift.

The Sierra Club and other groups also want the Headwaters acquisition expanded to include more land along streams where coho salmon habitat has been damaged by erosion caused by logging.

Government officials have argued that there is no connection between the savings and loan and Headwaters. Moreover, in a recent interview, Garamendi warned that the federal government does not have “unlimited wherewithal” to strike a deal with Pacific Lumber. “We’re not going to be able to fulfill everyone’s wish list.”

The comparatively small amount of land that the government hopes to acquire has been appraised at close to $500 million, and Pacific Lumber maintains that that appraisal is out of date.

To make the deal work, government officials must satisfy Pacific Lumber’s demand for replacement timber lands as valuable as the company’s core Headwaters’ holdings. While Garamendi has refused to say how much the federal government thinks the Headwaters property is worth, there are signs that negotiations are moving forward.

In a gesture of good faith, Pacific Lumber last week temporarily set aside its lawsuits that demand state and federal officials drop logging restrictions in the Headwaters or pay the company the value of the timber that cannot be harvested.

“I think a deal for Headwaters is doable,” said John Campbell, president of Pacific Lumber, “providing somebody doesn’t overreach.” He said that Pacific Lumber is not willing to give up more than 7,000 acres.

Some of the forest land being considered for the swap contains old-growth trees, though not redwoods, and is home to rare and endangered species. Federal negotiators say they won’t trade away sensitive land.

“We will not enter into a trade that swaps one environmental problem for another,” Garamendi said.