Preparing to Launch Forest Investment Zones

A pebble dropped in water creates ripples that are initially small; but they rapidly grow in circumference. That’s how the Endowment envisions the results of our largest programmatic initiative to date: Forest Investment Zones: Co-Creating Innovation and Learning at the Regional Scale. Even though the initiative will focus on a small number of regions, our intent is for the benefits to be shared broadly as models that can be implemented in communities across the nation. The notion of co-creating this program is critical to success as we look to those closest to the ground to help us build and implement the concept.

Implementing a programmatic approach to funding at the nexus of forest health and community resilience is a major framework for the Endowment’s work. This framework was built upon initial conversation within the Endowment’s Board and staff, outreach to professional networks, a national survey of needs and opportunities and a national workshop that allowed depth and breadth of discovery.

The national workshop highlighted the opportunity to work strategically by focusing in specific geographic regions identified as “Forest Investment Zones.” We were intrigued by this notion and began a series of actions to build upon the idea. We have work underway in a number of initial efforts intended to provide a solid foundation for this signature work. Among some of these early works are:

1. A soon be implemented process to add information about conservation easements on forested lands that will help bring into focus a more complete picture when combined with public lands. Not only should this provide a glimpse of the opportunities for long term working forests, but it should also allow better targeting and coordination of limited financial resources;

2. Gathering information with regard to the benefits of “clustering” intended to uncover innovative business models and provide important information about ways to enhance market connections for new business opportunities. And,

3. Work to identify the state of community-based forestry endeavors that provide examples of existing community/regional work at the nexus of healthy working forests and vibrant forest-reliant communities.

The concept of forest investment zones has the potential to demonstrate the breadth of the Endowment’s Mission and Theory of Change. The work within zones stands to showcase actions that promote the health of working forests, create new business models and stimulate value-added production that is structured to create benefits for communities. This occurs because all three components are the focus of the work…market conditions (value streams), strategies to maintain healthy working forests…and, assisting communities to directly enhance their capacity needs to build a brighter future.

Working at the regional level is daunting, but many economic theorists agree that such is the best way for communities to mitigate impacts and seize opportunities resulting from globalization, climate change, and living in a post-cheap-energy world.

The Endowment will over the next few days release a Request for Pre-proposals (RFP) to begin this process. We anticipate selecting three responses nationally. They will be geographically diverse and respond to the variety of opportunity for retaining working forests, capturing value streams and enhancing community capacity. We will be looking for mature regional intermediary organizations or networks to assist with implementation. After all, it is the people working closest to the ground who have the connections, information and ideas necessary to not only influence their own future but also to help us all learn together.

Our hope is that this work will create additional ripples of innovation, inspiration and positive change across the nation.

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Definitions:

Regional intermediary: high-capacity organizations or networks of organizations who commonly work together. They are familiar with influences, drivers and opportunities in their given regions.

Region/forest investment zone: The base criteria for identifying Forest Investment Zone candidate areas include:

1. Multi-county, multi-community, and/or, where possible, a multi-state area that is considered as a region and shares characteristics common to other areas of the nation (living laboratories/incubators);

2. Sufficient amount of working forest (public and/or private) is available for a significant/foreseeable period (e.g. at least 25 years) to support a variety of forest-based business opportunities (Most of the work will be focused in areas that are likely to remain in a heavily forested condition where there are no currently known threats that suggest wholesale conversion to non-forest uses– for instance, the area is not in the immediate path of a major urban/suburban growth pattern.); and

3. Traditional forestry businesses (either pulp/paper, sawmilling and other related businesses) have been a significant part of the area’s development history and continue to be important today, although perhaps a declining segment of the economy.

A Picture is Worth...

Is a picture really worth a thousand words? Or, do they sometimes just raise questions?

We’ve had a musing about what the “bridge” picture on our website is about. Without getting too esoteric it has several different meanings:

1. First, and perhaps most simply, this is “Liberty Bridge” in Falls Park on the Reedy River in Greenville, South Carolina. We used the picture in our 2007 Annual Report to depict a story about “our home.”

2. We are miserly in using the Endowment’s financial resources. When we opted to “enhance” and update our website, we chose to use art and pictures that we already owned rights to.

3. It is a wide angle shot that fits well in a banner layout. A tree would have to be in the prone position to do so.

4. There is a subliminal message as well. The Endowment focuses its work on “bridging” the full range of interests inherent in sustainable forestry – environmental, social and economic.

5. Yet, the underlying reason is that this particular bridge tells a story about perseverance, vision and symbolism in community revitalization.

As Paul Harvey would say, “Now, for the rest of the story…”

Like most communities in forested sections of the nation, Greenville was once built on trees and wood products. Yet, it quickly migrated to a different industrial base – textiles. The original wave of textile mills was always found on rivers. The flowing waters served as a source of needed energy and then as an all-too-convenient place to dump wastes.

Greenville’s small Reedy River and the falls that were once the center of downtown activity also hosted one of the first dams and mill complexes. Over the years, development, pollution and changing interests, saw the once popular recreational site fade from glory. Thus, when a four-lane highway and bridge were proposed directly over the falls some decades later, there was little outcry. Greenville’s roots were “forever” hidden from sight.

Even against the backdrop of a highly polluted river, a few women noted that the river and its falls held intrinsic value that shouldn’t be covered-up. A small number kept up that clamor for nearly fifty years until a very controversial decision was made to “tear down a perfectly good bridge” and replace it with a means for people to “walk across the falls.”

While few shared the vision of what could be – remembering only the polluted nature of the river – the project moved forward. The bridge came down and in its place rose a very expensive ($4.5 million) one-of-a-kind floating arc that provided a panoramic view of Greenville’s birth place – Reedy River Falls.

The action spawned a palpable and very visible rebirth of Greenville’s historic West End -- booming economic development both retail and residential, refurbished parks and lots of outdoor activity. But perhaps the greatest gain can be seen in the pride shared openly by Greenville residents who serve as tour guides to their visiting family and friends as the bridge and falls have become a “must see” for all.

Greenville’s decision to “do something radical” serves as a lesson to many forest-reliant communities seeking to chart a new future. Some of the most impactful decisions to stimulate economic activity and reinvigorate a community are often symbolic in nature. Greenville did something that is uniquely its own. It showcased its roots and built a shining symbol that bridges its past and its future.

For more information about Falls Park and Liberty Bridge visit: http://www.fallspark.com/about.asp

Top Seven Questions Asked about the Endowment

As you might guess we get questions...lots of questions. Many people are interested in a new foundation coming on the scene especially one with such novel beginnings. While much of this information can be found "somewhere" on our website, we thought we would pull together in a single place those questions we get most frequently and take a quick cut at trying to answer each.

Q. Explain again how the Endowment came to be.
A. As best we can tell the Endowment's roots are truly without peer. We were funded with a one-time $200 million infusion of funds that resulted from a settlement of a long-running trade dispute between Canada and the U.S. We were created at the request of the Government of the U.S. with funds actually coming directly from the Government of Canada. The money was part of a $5.4 billion settlement that saw $450 million designated for "meritorious initiatives" in the U.S.

Q. If you have $200 million why haven't you already distributed those funds to needy causes?
A. Of the three organizations that shared in the $450 million that went to not-for-profits, the Endowment is the only one designated as a "true endowment." Thus our $200 million cannot be spent; instead, annual earnings constitute the source of funds to support our programmatic activity.

Q. You no doubt get input and requests from dozens of interests suggesting how the Endowment should go about its program. How do you choose what to fund?
A. Not only have we had lots of input; we've actually solicited it. One of our basic commitments as a public charity is to be open and transparent in all that we do. We've intentionally sought-out input from across the nation. Early on we used two specific means to generate ideas -- an open Internet survey followed with a national workshop to ensure broad based and representative input into the formation of the Endowment's strategic direction. That strategic direction is now set and we are beginning to drill down and fund specific activities that will achieve desired outcomes.

Q. Why won't the Endowment accept unsolicited requests for funds?
A. The Endowment has perhaps the leanest staff model of its peer group – three full-time employees. To adequately address hundreds of unsolicited grant requests would require a much larger staff. But that’s just part of the answer. The Endowment Board has made a commitment to pursue “systemic, transformative and sustainable” change. Such requires a tightly focused approach with a plan to do few things and do them well. The Endowment operates primarily by RFPs (Requests for Proposals) where we state our desired objective or outcome and allow anyone to submit a proposal about how they would go about achieving that end.

Q. The Endowment speaks about sustainable forestry and working forests.
A. First, let’s go to the definition of “sustainable forestry.” Sustainable forestry is founded on the tenets of balancing environmental, social and economic needs and outputs. The Endowment is totally committed to environmental protection in the context of healthy working forests. In developing our programmatic portfolio we are working with a wide range of partners from federal and state natural resources agencies to research institutions to communities and conservation organizations.
For those who like things to be a bit more technical here are two of our key definitions:

Sustainable forestry: the stewardship and use of forests and forest lands in a way, and at a rate, that maintains their biodiversity, productivity, regeneration capacity, vitality and their potential to fulfill, now and in the future, relevant ecological, economic, cultural and social functions, at local, national and global levels, and that does not cause damage to other ecosystems.

Healthy working forests: forests that maintain the function, diversity, and resiliency of all components and can either produce or have the potential to produce a range of wood-based products, while also serving a broad range of societal needs including recreation, water, wildlife and other ecological services.

Q. Tell us about the Endowment’s Board. Isn’t it made up exclusively of leaders from forest industry?
A. Four of 13 members of the Endowment’s Board have recent experience in the forest industry. Only one person, John Weaver, designated as liaison by the Government of Canada, is directly affiliated with the forest products industry. Duane McDougall, former CEO of Willamette Industries (now retired) was recruited for his leadership skills and financial strengths (a CPA by education); Mack Hogans, (retired from Weyerhaeuser Company) is a forester with a broad range of skills and experiences including heading a company foundation. Two of our number are family forest owners (Peggy Clark of AR and Chuck Leavell of GA). We have a former state forester (Bruce Miles, TX); a consultant to forest investors (Jim Rinehart, CA); a former University Dean and Acting Provost (David Thorud, WA); and three of the nation’s leading experts in rural communities (David Dodson, NC; Karl Stauber, VA; and Mil Duncan, NH). Our Chairman, Dick Molpus of Mississippi, owns and runs a Timber Investment Management Organization. Carlton Owen, the Endowment’s President is a forester and wildlife biologist with industry, not-for-profit and private consulting experience.

Q. We've seen press reports about a group that is challenging the Endowment. What's that about?
A. This stems from a single source, the Washington Forest Law Center (WFLC) in Seattle. WFLC is a public interest law firm involved in a number of challenges regarding public and private lands issues primarily in the Northwest. In the current matter, WFLC purports to represent itself along with three environmental organizations – Sierra Club, Center for Biological Diversity and Conservation Northwest. In an hour-long call on July 3, 2007, WFLC stated their concerns that the Administration had not directed the funds to programs and activities that WFLC deemed priority. WFLC repeatedly demanded “multiple board seats” on the Endowment to ensure that funds would be deployed in keeping with their interests. We made clear that the Endowment Board of Directors had been established in accord with the SLA and that WFLC’s interests would be addressed on a par with those of a multitude of other interested parties. Under no circumstances would the Endowment acquiesce to WFLC’s demand for board seats. WFLC representatives made clear that if their demands were not met, they would leverage press and political support. They’ve made good on those threats to generate attention. WFLC has also filed a Freedom of Information Act (FOIA) request seeking government documents regarding selection of organizations designated to receive funds under the “meritorious initiatives” section of the SLA. WFLC has followed that request with a FOIA lawsuit against the Administration to obtain additional information. The Endowment is not a party to that litigation.

Endowment Launches Staff Blog To Enhance Openness and Transparency

As one of the newest not-for-profits in the forestry sector, we at the U.S. Endowment have been running at full speed to build a a new organization with all of its moving parts (offices, staff, board, policies, bank accounts, fund managers, website, etc.) on the one hand, while charting a sound course for programmatic engagement and investment on the other. We've tried to do all of this with the leanest staff model in our peer group -- only three full-time employees.


Among the values we've espoused and tried hard to implement is a commitment to openness and transparency in all that we do. One of our Stewardship Principles is, "We value transparency, welcome public interest and communicate openly." We've tried to set the standard by posting "nearly everything" on our website. You'll find not only copies of our IRS Form 990 but also quarterly "plain language" stewardship reports penned by our Board Treasurer and President. These reports explain how we are doing in meeting our financial obligations -- something few not-for-profits share beyond their annual financial statements.


Additionally our two professional staff members have tried to make themselves readily available by attending conferences, "getting out" to hear directly from the field, or simply by responding to emails or phone calls. In short, we want to hear from all who share an interest in sustainable forestry and the needs of America's forest-reliant communities. For some time we've been thinking about how we might go even further. This "staff blog" is one such attempt.


Through periodic posts we plan to share deeper insight into the Endowment's thinking and decision-making processes as relates to programmatic investments and what's going on at the Endowment. It as a two-way street. We seek your thoughts, ideas and reactions.


One of our greatest challenges is to manage expectations. We get requests to attend dozens of conferences and appeals to support a wide range of projects and initiatives. While the Endowment is instantly the largest foundation in America dedicated solely to sustainable forestry and forest-reliant communities, our resources pale in comparison to the needs and challenges. Yet, we want to do all that we can to make a real and lasting difference.


In coming months we want to engage you in a better understanding of what we think we can do as well as those things that we can't.


We hope you'll join us in the discussion as well as the important work ahead.