Pie in the sky?

Their final destination was a 1,600-acre forest thinning project where work was underway. When they arrived Rosamond and Minkova plunged into an explanation of the train-car sized machine that was de-limbing and cutting dozens of felled trees.

The husband and wife team leads Good Earth Power AZ, the 2-year-old company that holds the biggest contract in the largest forest restoration project in the history of the U.S. Forest Service, the 2.4 million-acre Four Forest Restoration Initiative, or 4FRI.

As part of a tour through northern Arizona, Flake had stopped by the company’s Williams mill and nearby forest thinning operations to see how its work was going. Flake has not been kind to Good Earth, raising serious concerns about the fact that the company has thinned just 4,700 acres of the approximately 70,000 it projected would have been completed by this time.

Flake is not alone in his concern. Scrutiny from stakeholders across the Four Forest Restoration Initiative is on the rise. In the two years since the company took over the 4FRI contract, Good Earth has thinned just 1.5 percent of the Forest Service’s 300,000-acre goal. They have six and a half years to complete the other 98.5 percent, or about 295,000 acres.

The company and others involved in the project have offered a range of explanations for the shortcomings:

— Good Earth’s lack of local experience;

— the need to build up industrial infrastructure before thinning can occur;

— the major challenge of dealing with tree biomass — limbs, bark and needles — that cannot be processed as lumber;

— unrealistic timetables from the beginning.

While they all agree that the Good Earth isn’t moving fast enough, project stakeholders, industry players and elected leaders are now grappling with exactly how to respond as this part of the 4FRI project falls further and further behind.

“On a professional level, and because (Good Earth Power) does hold the contract and occupies the path toward successful implementation more than anyone else, I want them to succeed. But our patience cannot be infinite,” said Ethan Aumack, conservation director with the Grand Canyon Trust and a member of the project’s stakeholder group. “It's time to be honest about where we are now versus where we need to be.”

LEARNING CURVE

The 4FRI contract was transferred to Good Earth in September 2013 after the first operator, Pioneer Associates, failed to find investors to finance its work. Approval of the transfer required the Forest Service to determine that Good Earth was financially and technically sound and had the skill sets to fulfill the contract, according to Roberta Buskirk, the Forest Service’s director of acquisition management.

In the two years since that time, Rosamond, the CEO of Good Earth Power AZ, is well aware of the company's successes and its struggles.

“I wish we could go faster. We’ve learned a lot along the way. The original people who were bidding (on the contract) were saying it was going to take three years to build an industry and it is going to take three years,” he said in an interview after Flake's visit. “We’re going as fast as we can.”

“We’re almost there,” Minkova chimed in.

Up to now, the company has repeatedly maintained that its slow progress on cutting acres was because it first had to focus on building the infrastructure to cut, remove, transport and process both timber and biomass from the forest.

While acreage treated has fallen far short of expectations, Good Earth has tried to focus attention on its progress in other areas, like investment in new machinery and expanded capacity of the Lumberjack Mill in Heber, the construction of a new mill in Williams, its work to build up a fleet of hauling trucks and its new soils and composting operation.

But even the company’s announcements and projections about those operations have been marked by setbacks and delays.

A third shift that was supposed to begin at Lumberjack Mill in July hasn’t started and the plan to compost biomass into soils that was announced in January has yet to find a place to locate. After announcing in December it had leased a 37-acre site near Williams for a $50 million mill, Good Earth has yet to begin substantial work on the site, despite initially projecting that wood processing operations would begin in late March of this year. The company started interim operations at a smaller mill in Williams in June, but the mill was stopped soon after and has been silent since at least mid-July as the company does more work on the machinery.

In an update this spring, the company said it was cutting an average of 625 acres per month, but Forest Service records show this year the company’s average rate of thinning has hovered around 180 acres per month.

“It seems like we’re getting a different story every month, or a repeat of the same story,” said Chris Stephan, CEO of NewPac Fibre that operates next door to Good Earth’s two Williams parcels. “The things I see happening don’t look to me like they're going to generate the production needed to match the scale of the project and/or what has been put out in press releases.”

STARTUP PROBLEMS

In assessing Good Earth’s struggles and progress, Aumack at the Grand Canyon Trust noted that the company is new to the industry.

“GEP doesn't have any prior experience in the field. It's a strange dynamic - you wouldn't expect a contract of this scale would end up with an entity with no experience in the field, but that's where we are,” Aumack said. “(A startup) isn't an unfair way of characterizing who GEP is and why they may be succeeding or not. They just haven't done this before.”

Though Good Earth Power AZ’s parent company, Good Earth Power, does name sustainable forestry in Africa as a focus on its website, there is no mention of any projects involving forest restoration through mechanical thinning.

Meanwhile, Supervisors in Coconino County emphasized that fulfilling the major 4FRI contract would be difficult for anyone to do given the significant initial investment required to jumpstart operations.

“Obviously it feels slower than any of us would like it to be, but on other hand we lost our logging industry a long time ago,” said Mandy Metzger, Coconino County supervisor and the board’s liaison to the 4FRI stakeholder group.

At this point, the alternative of somehow transferring the contract out of Good Earth’s hands would be like going back to square one, said Art Babbott, the board’s chair.

“They’re investing millions in acquisition and capital and equipment. We have to let production catch up to that. It may be painful but there’s not another alternative,” Babbott said. “For me, the option of changing contractors is the most ineffective and inefficient thing we could do at this stage.”

Metzger agreed.

“We have to advocate for success,” she said. “There's no other route that's plausible.”

QUESTIONING EXPECTATIONS

Evaluating Good Earth’s performance also brings up questions about the expectations originally set for the contract. Was 30,000 acres per year and 300,000 acres in 10 years an unreasonable goal?

Several stakeholders have said that, given the scale of the project, it’s no surprise that Good Earth Power hasn’t been able to begin thinning thousands of acres right off the bat.

“An aspirational number” and a “pie in the sky” expectation was how Diane Vosick and Paul Summerfelt, both co-chairs of the 4FRI stakeholders group, described the contract’s goal that 30,000 acres per year would be thinned.

“I don’t think anybody fully appreciated problems we faced with biomass,” Vosick said.

Even Pascal Berlioux, a 4FRI stakeholder co-chair and one of the initial bidders on the contract, said that if his company had been chosen, it would have been a year to a year and a half before it would have started to harvest logs from the forest.

The problem, Berlioux said, is that Good Earth isn’t showing signs of laying the foundation for a 30,000-acre per year operation. He pointed out that the Williams site slated for the new mill has barely been touched, permit applications haven’t been filed with the state and thinning hasn’t accelerated to build a supply of wood for a major mill.

STILL HOPEFUL

Despite Good Earth’s struggles to make progress in the forest, commitment to the 4FRI project and optimism about its potential has remained strong among those involved.

Many are encouraged by an estimated 10,000-plus acres that other contractors have thinned on the east side of the 4FRI project this year. The Forest Service and the stakeholder group are also plunging ahead on a second environmental analysis of about 1 million acres farther to the east within the 4FRI footprint.

“This has been and will continue to be an incredibly challenging effort on so many levels – but we’re still on the right path,” Aumack wrote in a follow-up email. “We’re all working so hard to get landscape-scale restoration get off the ground - and I’m actually supremely confident it will.”