July 17, 2000
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It?s now or never for Debt for Nature. The Treasury Dept. is all but concluded. This summer, the judge will make an advisory ruling to the director of the Treasury?s banking regulatory division. The director will then issue a restitution order. We believe Treasury has proven its case, and a large restitution order is imminent. Maxxam has many reasons to settle, and to offer forestlands instead of cash:
- A huge cash judgment could bankrupt Maxxam.
- Some of Maxxam?s largest investors tell us that they prefer debt for nature to a cash payment.
- Debt for Nature is a win-win. Maxxam could trade forestlands which they can?t cut profitably (but are environmentally priceless) in exchange for settling the federal claims and resolving some of Maxxam?s most pressing and costly environmental disputes.
But FDIC & Treasury?s position is that their mandate is to recover cash, not forest. If they took Headwaters forestlands in lieu of cash, their mandate would be to liquidate the property or demand an equal value exchange from Interior or BLM. An existing law (Coastal Barrier Resources Act) already allows banking regulatory agencies to transfer property they acquire which is adjacent to an existing reserve, to resource management agencies. Rose seeks an amendment which would clarify that the banking agencies could donate such property to resource management agencies?avoiding the unacceptable situation of forcing Interior to liquidate some other holdings in exchange for saving the Headwaters. FDIC (which has acknowledged that it is funding Treasury?s case) would be much more aggressive in pursuing a Debt for Nature settlement if they had Congressional approval to donate recovered Headwaters forestlands to Interior. The amendment would also be good policy in its own right?our research has already uncovered four other examples where such a policy would have facilitated public acquisition of properties that Interior was already trying to conserve.
We need to make significant progress in this Congress to show FDIC/Treasury that Debt For Nature is worth considering. We also need to continue to keep the heat on Hurwitz through his stockholders to force Maxxam to agree to a debt for nature settlement.
It will not be an easy fight. Several Members of Congress, including House Majority Whip Tom Delay (R-TX), and Resources Committee Chair Don Young (D-AL), have demanded access to all of FDIC and OTS? sensitive legal research and background information that is crucial to their case. More chilling from a constitutional and public liberty standpoint, Congressman Young is demanding all records of any communications with activists and organizations who support Debt For Nature?including specifically Rose, Trees Foundation, EPIC, Sierra Club, and many others. We believe Congressman Young?s actions are a clear abuse of Congressional subpoena authority and a heavy-handed attempt to dissuade citizens from exercising their constitutional right to petition the government regarding issues of concern.
People can contact their Congressional and Senate representatives to ask them to support Debt For Nature and do everything in their power to ease a Debt for Nature swap for the agencies. It could help save the Headwaters today, and other valuable and threatened habitat tomorrow.
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TOC for Headwaters Update, Summer 2000