PROSPERITY OR CRISIS? EXAMINING THE EFFICACY OF BRITISH
COLUMBIA’S FOREST POLICY CHOICES TO SUPPORT THE FOREST
INDUSTRY
by
Tammy L. Baerg
B.Sc. Hons, University of Northern British Columbia, 2005

THESIS SUBMITTED IN PARTIAL FULLFILMENT OF
THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF ARTS
IN
NATURAL RESOURCES AND ENVIRONMENTAL STUDIES

UNIVERSITY OF NORTHERN BRITISH COLUMBIA
September 2016
© Tammy L. Baerg, 2016

Abstract
The Forest (Revitalization) Amendment Act 2003 significantly altered the conditions
for holding major forest tenure agreements in British Columbia. The goal of this forest policy
was to allow the forest industry to become globally competitive. This thesis asks whether or
not this goal was successful and what trade-offs were incurred as a result. Using the Prince
George Timber Supply Area as a case study, mixed methods of inquiry were employed. This
study examines changes throughout the forest industry over a fifteen-year period. In this case,
the forest industry became globally competitive. But, significant consolidation within the
forest industry occurred. Moreover, while the timber harvest increased and processing
became centralized, the forest industry’s overall contribution to the provincial economy
declined significantly. This thesis demonstrates that the government remains committed to
supporting the current forest industry. However, the aforementioned revitalization legislation
may have lasting negative repercussions for the provincial forest economy.

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Table of Contents
Abstract .................................................................................................................................i
Table of Contents ................................................................................................................ ii
List of Tables ....................................................................................................................... v
List of Figures .....................................................................................................................vi
Dedication and Acknowledgements ................................................................................. vii
Chapter 1: Introduction ....................................................................................................... 1
1.1. Introduction ............................................................................................................... 1
1.2. Purpose of the Research ............................................................................................ 2
1.3. Research Questions ................................................................................................... 4
Chapter 2: Background and Context................................................................................... 8
2.1. Introduction ............................................................................................................... 8
2.2. Background ............................................................................................................... 8
2.3. Context .................................................................................................................... 17
Chapter 3: Literature Review............................................................................................. 24
3.1. Introduction ............................................................................................................. 24
3.2. Forest Policy Change in British Columbia ............................................................. 25
3.3. Responses by the Forest Industry to Policy Change in British Columbia .............. 29
3.4. British Columbia Forest Policy Legacies ................................................................ 36
Chapter 4: Methodology and Methods .............................................................................. 43

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4.1. Introduction ............................................................................................................. 43
4.2. Ethical Considerations ............................................................................................ 45
4.3. Research Design ...................................................................................................... 47
4.3.1. The Case Study ................................................................................................. 48
4.4. Data Collection and Analyses ................................................................................. 51
4.4.1. Mill Closures .................................................................................................... 51
4.4.2. Employment ..................................................................................................... 53
4.4.3. Timber Harvest and Valuation ......................................................................... 53
4.4.4. Semi-Structured Interviews .............................................................................. 58
Chapter 5: Results and Analyses ....................................................................................... 67
5.1. Introduction ............................................................................................................. 67
5.2. Mill Closures ........................................................................................................... 67
5.3. Employment ............................................................................................................ 70
5.4. Timber Harvest and Valuation ................................................................................ 74
5.5. Semi-Structured Interviews..................................................................................... 89
5.6. Conclusion ............................................................................................................ 113
Chapter 6: Discussion ...................................................................................................... 114
6.1. Introduction ........................................................................................................... 114
6.2. Rationalization of the Forest Industry ................................................................... 114
6.3. Timber Harvest and Valuation .............................................................................. 118

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6.4. The Impact of Mountain Pine Beetle .................................................................... 121
6.5. Research Questions Revisited ............................................................................... 125
Chapter 7: Conclusion ..................................................................................................... 132
7.1. Introduction ........................................................................................................... 132
7.2. A Way Forward ..................................................................................................... 132
7.3. Limitations and Future Research .......................................................................... 133
References........................................................................................................................ 136
Appendix I – UNBC Research Ethics Board Approval................................................... 153
Appendix II – Event Time Line 1997 to 2011 ................................................................. 154
Appendix III – Interview Guide ...................................................................................... 155
Appendix IV – Information and Consent Form ............................................................... 159
Appendix V – Template Analysis Themes/Questions ..................................................... 161
Appendix VI – Content Analysis and Theme Development ........................................... 162

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List of Tables
Table 1: British Columbia Employment by Detailed Industry, Annual Averages…………. 70
Table 2: 2006 Direct Employments in Logging and Other Wood Manufacturing Sectors… 72
Table 3: 2006 Economic Dependency Indicators by Forest District…..………………...…. 73
Table 4: Approximate Direct Employment Loss Due to Mill Closures in the PGTSA…...... 73
Table 5: Interview Participant Statistics……………………………………………………. 90
Table 6: Theme 8 Subthemes and the Relative Frequency of Subtheme Indicators by Group
…………………………………………………………………………………………...… 106
Table 7: Theme 9 Subthemes and the Relative Frequency of Subtheme Indicators by Group
……………………………………………………………………………………………... 107
Table 8: Theme 10 Subthemes and the Relative Frequency of Subtheme Indicators by Group
………………………………….…………………………..…………...……………….… 109
Table 9: Theme 11 Subthemes and the Relative Frequency of Subtheme Indicators by Group
…………………………………..…………………………………..…………………..…. 111

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List of Figures
Figure 1. Map of the Prince George Timber Supply Area……………………………….…. 50
Figure 2. Forest licence volume harvested and scaled in the Fort St. James District…....…. 75
Figure 3. Forest licence volume harvested and scaled in the Vanderhoof District…............. 76
Figure 4. Forest licence volume harvested and scaled in the Prince George District….....… 77
Figure 5. Volume harvested by forest licences and scaled in the Prince George TSA….….. 77
Figure 6. Forest licence harvest in the Prince George TSA versus revenue collected…....... 80
Figure 7. Lodgepole pine harvested by forest licences relative to all species…………........ 81
Figure 8. Lodgepole pine harvested by forest licences in the Fort St. James District...…..... 82
Figure 9. Lodgepole pine harvested by forest licences in the Vanderhoof District……..….. 82
Figure 10. Lodgepole pine harvested by forest licences in the Prince George District…..… 83
Figure 11. Log grade distribution of lodgepole pine harvested by forest licences……..……84
Figure 12. Annual average stumpage paid for lodgepole pine versus all other species......... 87
Figure 13. Log grade distribution of all other species harvested by forest licences ……...... 88
Figure 14. Distribution of the scale of coniferous non-pine harvested in 2010 and 2011….. 88

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Dedication and Acknowledgements
I dedicate this thesis to my mentor, Rainer Muenter, and my father, William Robert
Baerg. Both men have profoundly influenced my life and have helped shape the person I am
today. Thank you.
I began my study of forestry at Selkirk College in 1993. It was there that I was exposed
to the concept that forest management is both a science and an art as it involves the
interaction between forest ecosystems and human systems. Both the internal and
interconnected dynamics of forest ecosystems and human systems are extremely complex,
and navigating these systems requires knowledge that is both deep and broad. This has been
my journey, and after 20 years of practicing various aspects of forest management and
broadening my educational foundation I have come to realize that if we are to understand the
complex interactions among natural and human constructed systems, then we need to
cooperate in the production and dissemination of knowledge, beyond the constructs of
academic disciplines.
I have so many people to thank for not only making this journey possible, but so
rewarding. First, to all of the interview participants, thank you for your contribution to this
research, it was invaluable and meant a lot to me. I would also like to express my deepest
gratitude to my committee; to my supervisor, Dr. Tracy Summerville, for giving me the
freedom to discover my research topic and the guidance I needed at every stage to complete
it and to Dr. Greg Halseth and Dr. Gary Wilson for their guidance, instruction, and timely
advice. I would also like to thank my external examiner, Dr. Kenneth Coates, for offering
your perspective and insight.
I want to acknowledge other members of the UNBC community who have had an impact
on my journey. To Dr. Catherine Nolin, thank you for opening my eyes to the kind of
influence that social research can have in the world. To my fellow graduate students and
NRES cohort, nobody understands graduate students like other graduate students. Your
encouragement and friendship have made the difference between quitting and finishing, so
thank you. Special thanks to Jessica Blewett for your unwavering support, perspective, and
insight, and to Jeannine Randall and Aija White, for their endless encouragement, great
company, and sound advice.
Finally, I want to thank the British Columbia Public Service for their financial support
through the Pacific Leaders Scholarship, and recognize all my supervisors and managers over
the past five years at the Prince George Natural Resource District, thank you for giving me
the flexibility to manage my work load to accommodate doing my Master’s degree.
In closing I want to acknowledge and thank my friends, family and colleagues for all of
your support, patience and encouragement, there are not enough words to express my love
and gratitude. The best is yet to come!

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Chapter 1: Introduction
1.1. Introduction
I have been interested in British Columbia forest policy since 1994, when the
province was on the cusp of introducing legislation that promised to revolutionize forest
practices in British Columbia. This legislation was the Forest Practices Code Act 1995. It
was an exciting time. Other experts, like biologists, hydrologists, ecologists, and geotechnical
engineers, were making significant contributions to the development of best management
practices for the complex forest ecosystems that make up British Columbia. Less than ten
years later, this revolutionary, but costly forest practices code was scrapped for a resultsbased regime brought to life by the Forest and Range Practices Act 2004. Prior to the Forest
and Range Practices Act, the government repealed numerous policies in the Forest Act 1996
through the Forest (Revitalization) Amendment Act 200, to support and revitalize a struggling
forest industry. With these most recent legislative shifts in forest policy, beginning in 2003, it
has been my observation that there is a pervasive silence surrounding the direction that forest
policy has taken and continues to take, which I find fascinating.
Although the current economic forecast for the British Columbia forest sector is for
stability (Bennett, 2016), there is a timber supply crisis unfolding in areas that were hardest
hit by the mountain pine beetle. This crisis, in turn, is prompting a new round of legislative
changes (FLNRO, 2012a). As well, spruce bark beetle populations are on the rise in the
Prince George Timber Supply Area and other parts of the province (Westfall & Ebata, 2014).
It has been estimated that 108,472 hectares of spruce have already been attacked by the
spruce bark beetle in the northern half of the Prince George District and lower third of the

1

Fort. St. James District. Given the location of the outbreak, it is likely that it falls within the
timber harvesting land base1 (THLB) (Westfall & Ebata, 2014). This latest bark beetle
outbreak comes in the wake of the mountain pine beetle epidemic. Spruce and species other
than lodgepole pine are expected to be the major contributors to the mid-term timber supply
(Snetsinger, 2011). Yet, the Ministry of Forests, Lands and Natural Resource Operations, in
its most recent service plan, declared its support for the forest industry and revealed its
strategy to provide jobs and economic growth, where the stated goal of government is to:
“[…] maximize the short and mid-term timber supply to support forest sector employment
and industry sustainability […]” (FLNRO, 2016a, p. 5).
1.2. Purpose of the Research
In 2003, the Liberal government made legislative changes in order to accommodate
the provincial government’s economic strategy for revitalizing the forest sector, and building
prosperity for British Columbia (MOF, 2003a). Although these policies were intended to
provide the forest industry with greater flexibility, which in turn was to benefit the citizens of
British Columbia (MOF, 2003a), these benefits have yet to be realized. The changes to forest
policies made in 2003 could not guard against the externally driven perturbations that
influence the boom and bust cycles of the lumber markets (Hoberg, 2010; Zhang, 2007).
Furthermore, these policies protected and benefited large corporations, which account for the
bulk of the forest industry, more than they did forest-dependent communities.
The aforementioned legislative changes were made to the Forest Act 1996 via the
Forest (Revitalization) Amendment Act 2003. Among other things, Bill 29 repealed Section
14 (f) of the Forest Act 1996, which required holders of forest licences to maintain a timber
1

“The timber harvesting land base (THLB) is the area of productive forest land available for timber
harvesting” (Snetsinger, 2011, p. 10).
2

processing facility in the region where timber was harvested (Bill 29, 2003). Presently, there
is concern about a rapidly declining timber supply in areas that have been hard hit by the
mountain pine beetle and what that will mean to both the forest sector and the economies that
depend upon it (ABCFP, 2011). The removal of the appurtenancy clause has generated fear
in forest-dependent communities that forest corporations, via their job-producing processing
facilities, will no longer be tied to the regions from which they extract timber (Hoberg, 2010).
The removal of appurtenancy was only one in a suite of legislative changes designed
to revitalize a struggling forest industry (Hoberg, 2010). Other changes permitted forest
corporations to consolidate and subdivide forest licences, and gave them the ability to
transfer agreements (Bill 29, 2003). These changes further strengthened the property rights of
forest corporations on British Columbia’s public lands and makes compensation for breach of
these rights less likely on the part of the provincial government (Luckert, Haley & Hoberg,
2011). However, they did not trigger the mass dumping of assets, in the form of sawmills, as
some observers worried. Rather, the new rules facilitated further restructuring within the
sawmilling sector, allowing it to remain viable.
Though change is a constant factor in the resource sector, the pace and scale with
which it is occurring in north-central British Columbia is increasing. The alarming reality is
that resource extraction and export is happening at an unprecedented pace (Burda & Gale,
1998) in the midst of externally driven, market related perturbations that are also increasing
in both frequency and severity (Halseth, Markey, Reimer & Manson, 2010). In the Northern
Interior forest region of British Columbia, the timber resource is becoming depleted (FLNRO,
2012a). It also appears that there has been a lack of diversification within forest dependent
communities (Horne, 2009). Innis (1933) argued that Canada was locked into a staples

3

economy and that its pathway was determined by its absolute dependence upon its natural
resources, which is still true for British Columbia (Bowles, Lytle & Paterson, 2002; Hayter,
2000; Markey, Halseth & Manson, 2008). Freudenburg (1992) explains that commodity
driven economies are extremely vulnerable in a globalized economy. Nonetheless, the
government of British Columbia continues to look to other resources to exploit and replace
timber as the province’s primary commodity and revenue generator (EMNG, 2013).
1.3. Research Questions
The Northern Interior forest region of British Columbia is facing a timber supply
crisis. Though this crisis was inevitable, its arrival was accelerated by the devastation caused
by the mountain pine beetle epidemic (Snetsinger, 2011). Proper mitigation of this timber
supply crisis is vital given that the area hardest hit exists in some of the most forest
dependent regions in British Columbia’s interior. This crisis provides an opportunity and
context to demonstrate how forest corporations have adapted their business, in terms of
where they process the timber they cut, as a result of the relaxed regulations brought in by the
Forest (Revitalization) Amendment Act 2003 and to critically evaluate long standing
harvesting, revenue generation, and timber allocation decisions that continue to dominate
British Columbia forest policy.
This thesis will argue that while the government’s relaxation of restrictive
legislation and promotion of a good business environment has assisted forest corporations
and facilitated the temporary survival of the forest industry, the adoption of neoliberal
economic theory into the context of the British Columbia forest industry has not strengthened
British Columbia and brought prosperity. Rather, the application of this theory has weakened
the forest economy as a whole by perpetuating the status quo of the timber supply being

4

controlled by forest corporations. Further, though the assistance to strengthen the forest
industry has resulted in a more stable forest economy, this forest economy contributes a
much smaller share than it once did in the provincial economy. At the same time, the people
of British Columbia have not received fair compensation for the publically owned timber that
drives this forest economy. Finally, this thesis will argue that the long term viability of a
forest industry in British Columbia will likely require a more radical shift in forest policy,
which could include a different arrangement of forest tenures.
My research examines the policy changes of the Forest (Revitalization) Amendment
Act 2003, invoked by the Liberal government, that were aimed at revitalizing the forest
industry. Although little has changed over time with regards to British Columbia’s core forest
policies (Haley & Nelson, 2007; Pearse, 2001; Rayner, Howlett, Wilson, Cashore & Hoberg,
2001), I suspect that the context and driving forces which shape forest policies have changed.
It is the complexity of forest policy that warranted a holistic approach to this research. Such
an approach not only examines the internal and external forces that drive government policy,
but uncovers the interconnection between policy choices made and the impacts of those
policies on both the intended and unintended targets. For these policy changes in question,
the intended target is the forest industry and the unintended targets are the environment and
human communities. My data collection was guided by my research questions, which are as
follows:
1) What was the context that motivated government to make the 2003 forest policy
changes?
 Were these forest policies already in place in other jurisdictions, or were they
unique to British Columbia?
 What was occurring globally at the time that may have influenced this specific
direction?

5

 Were potential negative outcomes for the environment and/or human
communities considered? If so, what were the mitigation strategies?
 Were these changes related to the recent change in government, from the NDP
(political left) to the Liberals (political right)?
2) How have forest corporations responded to the 2003 policy changes over time?
 Has the number and distributions of sawmills and fibre flow changed over time?
 Did these changes in forest policy help industry? If so, in what ways?
 Did the forest industry participate in the formulation of the policies?
To answer these questions regarding the forest industry, I collected and analysed
data regarding timber harvesting, sawmill distribution, lumber markets, as well as
employment and economic trends. The data that I collected was restricted in both time and
space. The time frame in which data was collected was limited to the period between 1997
and 2011. The focal point on the British Columbia landscape was the Prince George Timber
Supply Area. Next, I conducted semi-structured interviews with key informants who were
involved in the forest industry within the Prince George Timber Supply Area between 1997
and 2011, and who had specific knowledge regarding the various stages of the forestry policy
formation that came into being under the Forest (Revitalization) Amendment Act 2003. The
purpose of the interviews was to solicit their explanations as to the findings of my secondary
research of official records and documents.
The remaining structure of this thesis begins with Chapter 2, where I lay a
foundation of historical background of forest policy and provide context by discussing how
forest dependent communities in northern British Columbia and neoliberal ideology are
related to forest policy. This discussion will be followed by a review of the literature in
Chapter 3 where I situate my research by discussing the changing dynamics of forest policy
and the forest industry in British Columbia. Next, in Chapter 4, I present the methodology

6

and methods I used to answer my research questions and discuss the ethical considerations I
had in undertaking this research, my choice of using a case study as my research design, my
use of a mixed methods approach to collect data, and my methods of data analysis.
In Chapter 5, I present the results of my research which provide evidence as to how
the rationalization of the forest industry unfolded and its impact on employment, where
timber was harvested and processed, how much revenue the Crown received for the timber,
and what people connected to the forest industry had to say about these topics and the events
surrounding the legislative changes to forest policy in 2003. In Chapter 6, I discuss the
findings of my research and how they answer the research questions. Finally, I conclude the
thesis in Chapter 7 by suggesting possible forest policy pathways for British Columbia,
discussing the limitations of my research, and making recommendations for future research.

7

Chapter 2: Background and Context
2.1. Introduction
To understand the present state of the forest industry in the Northern Interior forest
region of British Columbia it is important to discuss aspects of British Columbia forest policy,
forest dependence in relationship to the communities situated there (Bowles et al., 2002;
Markey et al., 2008; Power, 2006; Waggener, 1977), and the relatively recent shift to a
neoliberal political ideology in British Columbia (Summerville, 2010; Young, 2008). All of
these topics underpin both the historical and lived realities of communities located within the
Northern Interior forest region and are useful for understanding the significance of the shifts
that have occurred within this forest industry. Moreover, to understand the changes made to
legislation in 2003 by the Forest (Revitalization ) Amendment Act 2003 (Bill 29) it is helpful
to provide the context in which the forest industry was working in British Columbia prior to
2003 and the conditions which may have led the government to make these policy choices. It
is also useful to discuss the events that followed the changes brought in by Bill 29 because
they provide the context for this research.
2.2. Background
British Columbia has been described as a unique forest jurisdiction in that 95% of its
land base is public land (Luckert et al., 2011). Thus, because the majority of the land base is
public land, when the expansion of the forest industry and the conservation of the resource
are juxtaposed, the governments of British Columbia have historically, with a few exceptions,
ensured that ownership of land remained with the Crown (Clark 1985; Marchak, 1983).
Given that the majority of timber harvested in the province is from public land, and that
rights to Crown timber are allocated through a variety of timber tenures, discussion of forest

8

policy regarding how timber has been allocated historically is warranted. While it is evident
that the evolutions of several key forest policies surrounding Crown timber, its disposition,
its regulation, and its price, have strongly influenced the development of British Columbia’s
forest economy (Hayter, 2000; Marchak, 1983), changes made to forest policy have emerged
from the midst of conflict as private firms benefit from utilizing a public resource (Hayter,
2000; Hoberg, 2001; Howlett, 2001; Marchak, 1983). For better or worse, changes made to
forest policy have served the purpose of the time (Clark, 1985).
The formation of a timber tenure system in British Columbia was undertaken as a
means of timber allocation, but the underlying goal was to create favourable economic
conditions that would promote and support a forest industry (Howlett, 2001). The forest
industry was supported by making the timber supply available to investors (Howlett, 2001).
Though the number and types of timber tenures have expanded over time, the initial goal
remains unchanged (Howlett, 2001). British Columbia was successful in attracting many
multinational forestry corporations, with large amounts of external capital (Drushka, 1999);
these players obtained the largest forms of timber tenures available (Drushka, 1999; Hoberg,
2000), the forest licence and the tree farm licence (Howlett, 2001). In 1996, 82% of the
provincial allowable annual cut (AAC) came from tree farm licences and forest licences
(Hoberg, 2000). The control over the provincial timber supply is not a recent development;
rather, its roots go back to the beginning, when the alliance between government and private
sector firms in the forest industry was forged (Howlett, 2001; Marchak, 1983).
From a forest management standpoint, the history in British Columbia can be
divided broadly into the unregulated (1858-1945) and regulated (1945 to present) periods.
That is not to say that there were no regulations pertaining to forest management in during

9

the unregulated period, rather, that regulations were sparse and, more importantly, that timber
rights were less secure. Between 1858 and 1865, the only way to access timber in British
Columbia was to purchase the land on which it grew (Clark, 1985). In 1865, the government
made changes in policy which enabled it to lease the rights to Crown timber (Clark, 1985).
Leasing rights allowed the government to retain ownership of the land while simultaneously
encouraging a timber manufacturing sector (Clark, 1985). Interestingly, in order to obtain
these rights the lessee had, “to own and operate a sawmill” (Clark, 1985, p. 5).
By 1905, under the leadership of Premier Richard McBride, British Columbia was
desperate for revenue and began to sell off timber rights for a pittance (Clark, 1985).
Coincidently, the broad relaxation/removal of regulation occurred at the same time that the
conservation movement was gaining significant momentum in the United States (Howlett,
2001). An unprecedented wave of timber speculation followed and subsequent concentration
of amassed holdings (Howlett, 2001) because these special licences were renewable and
transferable (Clark, 1985). The era of timber speculation ended in December of 1907 and
sparked the first Royal Commission, led by F.J. Fulton (Clark, 1985). Though this policy had
generated substantial revenue for the province, Clark (1985) contends that it also set the tone
for the management of the forest resource.
Forest policy in British Columbia further developed through the recommendations
and findings of several Royal Commissions, which were used by government as a means of
both engaging and educating the public (Clark, 1985). The first Royal Commission was
headed up by F.J. Fulton in 1910 and can be credited for the formation of the Forest Act of
1912 (Howlett, 2001). The templates for volume and area based timber tenures stem from the
Royal Commission on Forestry led by Chief Justice Sloan in 1945 (Howlett, 2001). One of

10

the outcomes of the Sloan Royal Commission of 1945 was the creation of the Private and
Public Working Circles (Hayter, 2000). The Private and Public Working Circles, essentially
management units, were the foundational structures for timber administration that were
intended to bring both public and privately held timber rights under sustained yield forest
management (Pearse, 1976).
In order to bring privately owned rights to timber into the sustained yield model,
compensation had to be given by the provincial government to the holders of these rights.
Membership into the Private Working Circle was offered to those who held Crown land
grants and timber leases (Pearse, 1976). In exchange for agreeing to regulate the harvest over
the privately held area, the government offered additional Crown land which would be
amalgamated with the existing private holdings into one area based licence (Clark, 1985). So,
the Private Working Circle consisted of these area based licences, which are now known as
tree farm licences (TFL) (Clark, 1985). The Public Working Circle consisted of the
remaining Crown timber land base and was administered by government (Pearse, 1976).
From the Public Working Circle management unit, timber was allocated through volume
based licences (Clark, 1985), the largest of which is known today a forest licence (FL). The
Public Working Circle was later divided up into Public Sustained Yield Units (PSYU), which
then became the Timber Supply Areas (TSA) (Clark, 1985).
The Private Working Circle licenses afforded their holders tremendous property
rights, which they could leverage as assets (Howlett, 2001). The government then gave
preferential treatment in awarding the volume based licences in the Public Working Circles
to those who had mills or secondary manufacturing, which enabled many of the players in the
Private Working Circles to gain a foothold in the Public Working Circles (Clark, 1985). Thus,

11

those who controlled the Private Working Circles quickly gained control of the Public
Working Circles (Clark, 1985).
The management regime of sustained yield, introduced by the Sloan Royal
Commission, was seen as a means of managing the timber supply (Marchak, 1983; Prudham,
2007). Sustained yield was also instituted to provide government with revenue, industry with
timber, and communities with jobs (Prudham, 2007; Rayner, 2001). The normal forest is the
underlying concept of sustained yield, which is the systematic conversion of primary forests,
which are uneven-aged old growth, to even-aged ones (Zhang & Pearse, 2011). The strategy
is to divide up the known timber supply, either by volume or area, over a projected time span
of growth (at least 80 years in British Columbia) and harvest at a rate that liquidates the
virgin forests over the allotted time (Zhang & Pearse, 2011). In the case of British Columbia,
the timber supply is given out by volume and tracked on an annual basis, and the annual
allotment of it is known as the allowable annual cut (AAC) (Rayner, 2001).
One of the downsides of the strategy of sustained yield is that the total volume
available in the harvest of virgin forests is far greater than what will be available in the
subsequent harvests from regenerated forests (Zhang & Pearse, 2011). The volume difference
between the initial and subsequent harvest is so large, it has been given the term ‘fall down’
(Zhang & Pearse, 2011). Another problem is that by employing a sustained rate of harvest
there will also be a gap in available timber supply between the period when the old growth
supply is exhausted, and the subsequent growth becomes available (Zhang & Pearse, 2011).
The mid-term timber supply refers to the time period that follows once the old growth
(natural and original timber) has been liquidated, but before plantations (second growth) are
mature. Subsequently, the amount of timber available during this period is scarce. In British

12

Columbia, we have been approaching the fall down since the mid-1990s (Rayner, 2001).
Although the recent mountain pine beetle epidemic has pushed the central interior of the
province to this point (MOF, 2003b), the magnitude of the drop is much larger than anyone
anticipated and there is not much chance of mitigating the impacts to the timber supply given
almost all of the mature lodgepole pine, a significant contributor to the timber supply, is now
dead (Westfall & Ebata, 2010).
The development and expansion of British Columbia in the post war period was in
large part due to the social-economic beliefs of the government led by W. A. C. Bennett
(Bowels, Lytle & Paterson, 2002; Markey et al., 2008; Summerville, 2010; Wedley, 1990).
The focus then was on creating an inviting investment environment for industries, which in
turn would both establish and bring stability to communities (Bowles et al., 2002). W. A. C.
Bennett was able to draw investment to the province by creating infrastructure, generating
hydro-power, and establishing appurtenancy as part of the Forest Act (Markey et al., 2008;
Summerville, 2010). The appurtenancy clause was a formal agreement between the
Provincial government and forest companies where, in exchange for timber rights, forest
companies holding major volume based forest tenures were to maintain timber processing
facilities near to the origin of timber harvesting ; further, it is considered by many as a social
contract, designed to bring stability and growth to forest resource dependent communities in
British Columbia (Haley & Nelson, 2007; Luckert et al., 2011; Jackson & Curry, 2002).
In northern British Columbia the majority of communities are small, and many of
them are largely dependent upon, what Harold Innis (1933) described as staples economies.
Sustained yield and the appurtenancy clause were established during the era of province
building (Wedley, 1990) and understood then as a critical factor in promoting community

13

stability, and subsequently increased dependence on the forest resource (Power, 2006;
Waggener, 1977). That these economies are becoming increasingly threatened in the context
of the global economy makes the stability issue extremely important for people who live and
work in northern British Columbia (Markey et al., 2008). The economic dependence of
northern British Columbia communities upon natural resources is a well described and
established phenomenon and is seen as a barrier to economic diversification (Bowles et al.,
2002). Additional barriers include lack of finances, lack of infrastructure, conflict within the
community, capacity within the community, lack of human capital, social cohesion and
inclusion (Ryser & Halseth, 2010).
A function of the sustained yield timber supply regime was that it was supposed to
insulate forest dependent communities from the instability of the forest product market
business cycle over the long run (Zhang & Pearse, 2011). However, attempting to control a
market that is driven by demand by controlling supply does not work (Zhang & Pearse, 2011).
For example, between 1997 and 2008, a number of events occurred that had a negative
impact on British Columbia’s lumber market. They were: the Asian economic crisis (Hoberg,
2010); the rise in value of the Canadian dollar (Hoberg, 2010); the expiry of the Softwood
Lumber Agreement with the United States (Zhang, 2007); the downturn, and subsequent
crisis in the United States housing market (Hoberg, 2010); and, the general instability of
national economies globally (Luckert et al., 2011). Further, volatile fluctuations in lumber
markets have been shown to have negative impacts on forest sector employment, sometimes
within as little time as two months (Byron, 1978). Add to these market issues the increasing
global nature of the markets and the influencing sway of neoliberal ideology, and you have a
seedbed for change in forest policy.

14

In British Columbia, the pressure of globalization and the dominant tenets of
neoliberal ideology have been influencing the direction of government policies since the
1980s (Summerville, 2010). In its most basic definition, neoliberalism is an ideology that is
based in free market economics (Summerville, 2010), which is a stark departure from the
Keynesian economic model that dominated the post-war era in British Columbia (Hayter,
2000). One of the primary tenets of neoliberalism is that market freedom and greater
prosperity are constrained needlessly by government subsidies, regulations, social policies,
and general bureaucratic interference (Harvey, 2005; Summerville, 2010). The rise of
neoliberal ideology is a phenomenon that can be seen globally (Harvey, 2005; Humphreys,
2009). Notable leaders who helped usher in neoliberal ideology are Margaret Thatcher in the
United Kingdom in 1979, Ronald Reagan in the United States in 1980 (Harvey, 2005; Savoie,
1994), David Lange in New Zealand in 1984 (Roche, 1990), and Brian Mulroney in Canada
in 1984 (Graefe, 2002; Savoie, 1994). While neoliberal ideology guided the dominant politics
in the aforementioned jurisdictions, exactly how neoliberal agendas played out and to what
extent varied dramatically in each country (Harvey, 2005) and even within Provincial
jurisdictions of Canada (Graefe, 2002).
The advancement of neoliberalism in Canada can be described as gradual, through
the neoliberal agenda of fiscalization (Graefe, 2002). The term fiscalization: “refers to
periods when financial concerns, especially considerations of expenditure restraint and deficit
reduction, dominate deliberations on setting public policy priorities and contemplating social
reforms” (Rice & Prince in Graefe 2002, p. 20). The neoliberal agenda was advanced amidst
the pressure of globalisation and an economic recession via the empowerment of the
Department of Finance in Canada’s provinces (Graefe, 2002). He also notes that there is a

15

lack of distinction between political parties, as fiscalization was applied in different
provinces under the leadership of differing political parties. For example, these fiscalization
policies were applied in Saskatchewan by Grant Devine (Conservative 1982-1991), in
Ontario by Bob Rae (NDP 1990-1995), in Quebec by Robert Bourassa (Liberal 1985-1994),
and in New Brunswick by Frank McKenna (Liberal 1987-1997) (Graefe 2002). In his study
of provincial jurisdictions in Canada, Graefe (2002) notes that neoliberalism has been applied
unevenly because the form and the extent to which different governments have adopted the
ideology has varied.
Harvey’s (2005) work on neoliberalism is based on the premise that
neoliberalization is a “political project to re-establish the conditions for capital accumulation
and to restore the power of economic elites” (p. 19). With respect to class, Harvey (2005)
explains that, “[w]hile neoliberalization may have been about the restoration of class power,
it has not necessarily meant the restoration of economic power to the same people” (p. 31).
Harvey (2005) uncovers its origin to be with the Mont Pelerin Society, whose ideology had
its roots within liberal ideals, such as personal freedom, but with “adherence to those free
market principals of neoclassical economics” (p. 20). Members of the Mont Pelerin Society
included some of the most renowned economists of the 20th century including, Ludwig von
Mises, Friedrich Hayek, and Milton Friedman (Harvey, 2005). However, as Harvey (2005)
points out, contradictions within the neoliberal position are many. In fact, neoclassical
economics and liberal ideals are frequently diametrically opposed (Harvey, 2005). Therefore,
he warns to take heed of, “the tension between the theory of neoliberalism and the actual
pragmatics of neoliberalization” (Harvey, 2005, p. 21). Harvey (2005) says that while

16

neoliberalization has not been very effective in increasing global capital accumulation, it has
been widely effective in either restoring or creating economic elite power.
2.3. Context
In 1997 the forest industry was struggling under the complex and expensive
environmental regulatory regime of the Forest Practices Code of British Columbia Act 1995,
a quota system that regulated the flow of softwood lumber exports into the United States, and
the unprecedented high level of stumpage charged for timber, known as super-stumpage that
was rendered to the Crown (Grafton, Lynch & Nelson, 1998; Hayter, 2000). Earlier, in 1987,
a new means for calculating stumpage was adopted by the province to appease the authors of
a memorandum of understanding with the United States. This new method was known as
comparative value pricing (CVP), which was essentially an ad valorem tax2 which was
calculated using the market selling price of lumber and did not account for logging expenses
(Grafton et al., 1998).
Later in 1994, under an NDP government, the system was revised to increase the ad
valorem at a higher rate as the market selling price of lumber increased, which was known as
super-stumpage (Grafton et al., 1998). Meanwhile, the policies and regulatory regime created
by the Forest Practices Code of British Columbia Act 1995 significantly increased the cost to
harvest timber and over time eroded the ability of companies to respond effectively to
changes in market conditions (Hayter, 2000; Pearse, 2001). However, by 1997 the Asian
economic crisis had negatively impacted companies like MacMillan Bloedel that primarily
exported lumber to Japan. These companies suddenly found themselves without a market and
insufficient quota to ship their product into the United States (Pearse, 2001; Zhang, 2007).
2

An ad valorem tax is a tax that is based on value. For example, municipal property taxes are based on real
estate values (Klemperer, 1996, p.279).
17

There was recognition by the provincial government that the forest industry was in trouble
and it began to institute changes to help streamline the costly regime created by the Forest
Practices Code of British Columbia Act 1995 (MOF, 1998). However, these changes were
deemed insufficient by the Council of Forest Industries (COFI), which published its own
ideas for improving the forest industry. The central theme of this document was that the
forest industry needed to be globally competitive (COFI, 1999).
The NDP, who were in government at the time, took note of the suggestions made
by the forest industry and in 1999/2000 began the shift towards a more results-based model
of forest practices than the prescriptive regime of the Forest Practices Code of British
Columbia Act 1995. The new model was to be tested using five pilot projects (MOF, 2000).
Further, the government was also beginning to explore a market-based pricing system that
would generate stumpage values, knowing that stumpage values would be a critical factor for
negotiating a new softwood lumber agreement with the United States (MOF, 2000). Despite
the government’s efforts to relieve forest companies of the excessive and costly regulatory
requirements, it would not alter its course in the way it collected stumpage (Pearse, 2001).
Hence, companies struggled to balance the high cost of production with their softwood
lumber quotas amid declining lumber prices in the United States (Pearse, 2001). All the while,
the British Columbia forest industry faced an overall increase in competition from other
timber producing regions (MOF, 2000).
Market conditions for the forest sector continued to worsen through 2000 and into
2001, and to make matters worse, the Softwood Lumber Agreement expired on March 31,
2001 (MOF, 2001b). By April, the Coalition for Fair Lumber Imports in the United States
had filed a petition with the Department of Commerce to investigate countervailing duties

18

and anti-dumping claiming that British Columbia lumber manufacturers received subsidies
through stumpage collection and the prevention of log exports, and that lumber was dumped
onto the market in the United States below cost (MOF, 2001b). The situation with the United
States had become critical for the British Columbia forest industry, and while the provincial
government tried to assist the federal government with negotiations, several forest
corporations engaged in litigation with the United States (Zhang, 2007).
In May of 2001 the BC Liberal Party was elected with a resounding majority. British
Columbia was poised to embark into a “New Era,” in which the road to prosperity was
guided by three pillars: fiscal responsibility; free enterprise; and, equality of opportunity and
responsibility (BC Liberal Party, 2001). Meanwhile, in the lodgepole pine forests of British
Columbia the largest mountain pine beetle (Dendroctonus ponderosae) epidemic in history
(Westfall, 2001) began to seriously threaten the timber supply and the economies dependent
upon it (MOF, 2003b). As the beetle infestation began to expand across much of the Northern
Interior Plateau, government, the forest industry, and communities worked together to form
strategies for managing the spread and damage caused by the epidemic (FLNRO, 2012b). As
the epidemic progressed, these strategies shifted from mitigation of damage and spread to
capturing losses (FLNRO, 2012b).
The new government set to work on its mandate to assist the forest industry by
giving it the flexibility to transform itself and become more competitive (MOF, 2002b). The
government focused on changing the regulatory environment, such as moving to a marketbased pricing system for calculating stumpage and changing forest practices to a resultsbased, rather than a prescriptive-based regime (MOF, 2002b). However, these changes took
time so the forest industry and the government had to endure the market restrictions and

19

retaliations imposed by the United States (Hamilton, 2001). Still, the focus of the government
remained steadfast: to reduce government influence over the business decisions made by the
forest industry. Reducing government influence over the business decisions of the forest
industry was the driving ideological force behind the impetus for legislative change (Hayter
& Barnes, 2012; Hoberg, 2010).
Amidst the first strategies for managing the epidemic were concerns about the
regulatory and operational constraints that would prevent effective containment of the beetle
spread (MOF, 2001a). Government paid considerable attention to policies that would enable
the forest industry to maximize the harvest of beetle infested lodgepole pine by temporarily
increasing the allowable annual cuts (AACs), repealing constrictive regulations, and
subsequently directing the harvest to timber supply blocks considered to be the most heavily
infested (MOF, 2003b). Increasing the availability of timber for harvest was one challenge,
having the incentive to harvest was quite another. There were perceived limitations for
processing, which included the milling capacity of industry (FLNRO, 2012b), adverse market
conditions, and the constraints of the Softwood Lumber Agreement with the United States
(FLNRO, 2012b; Zhang, 2007). One response by government was to change forest policy so
that the industry could be more flexible in its response to market signals (MOF, 2003a).
The most recent wave of changes to forest policy began in 2003 with the enactment
of the Forest (Revitalization) Amendment Act, where major changes to the Forest Act 1996
were made in order to accommodate the provincial government’s economic strategy for
revitalization of the forest sector (MOF, 2003a). These changes were part of the Liberal
government’s quest for prosperity; for example, Bill 29 – 2003, the Forest (Revitalization)
Amendment Act 2003 repealed Section 14 (f) of the Forest Act 1982, which required holders

20

of forest licences to maintain a timber processing facility in the region where timber was
harvested. Legislative changes continued in 2004 with the Forests and Range Practices Act
(FRPA). Considered by industry as overly regulated and unduly prescriptive, the Forest
Practices Code of British Columbia Act 1995 was slowly phased out in favour of the new
results-based forest and range practices regime (MOF, 2002a).
Despite the changes made to forest policy, by 2008 a severe downturn in the forest
economy was experienced throughout British Columbia (BC). During the fervor of an
accelerated harvest of beetle killed pine in the northern and central interior, the BC lumber
manufacturing industry suffered severe blows to its lumber markets via the ongoing
Softwood Lumber dispute with the United States, from 2001 to 2004 (Zhang, 2007), a drastic
drop in housing starts in the United States in 2005, the rise in value of the Canadian dollar in
2007, and the housing market crisis in the United States in 2008 (Hoberg, 2010). By 2008,
sawmills throughout British Columbia began to close, some temporarily and some
permanently (Hamilton, 2008), which threatened the very existence of many communities
(Martin, 2013). The temporary loss of BC’s largest lumber importer prompted the provincial
government to pursue Chinese lumber markets more aggressively (MFR, 2008a). These
inroads made by government into China assisted the forest industry by providing markets so
that mills remained viable (Bowles & MacPhail, 2016; FLNRO, 2012b).
In February of 2012 a report was released by the Auditor General of British
Columbia criticizing the lack of timber stewardship by the Ministry of Forests, Lands and
Natural Resource Operations (AGBC, 2012). In May, a Special Committee on Timber
Supply was formed and they toured the communities in the Northern Interior forest region of
the province seeking input from citizens and stakeholders alike. This committee released its

21

report in August, in which it made numerous recommendations in relation to the mid-term
timber supply crisis (SCTS, 2012). This report was followed in October by a response from
the Ministry of Forests, Lands and Natural Resource Operations (FLNRO) that addressed a
number of the Special Committee’s recommendations to the Legislative Assembly. The
FLNRO responded by saying:
 that they will conduct a review of sensitive areas in terms of potentially
expanding the timber harvesting land base;
 that they will investigate the use of intensive silviculture practices as a means of
growing more fibre;
 and, that they will create legislation that would enable the conversion of volume
based forest licences into area based tree farm licences (FLNRO, 2012a).
Provincially, it is estimated that approximately 800,000 hectares of timber was
damaged by the mountain pine beetle in 2001; the current cumulative estimate, observed in
2011, is a staggering 18.1 million hectares of timber damaged by the mountain pine beetle,
which is still expanding north (FLNRO, 2012b). In the wake of the devastation caused by the
mountain pine beetle, and the large scale salvage harvesting that has followed, is a landscape
that has changed. The patchwork of clearcut areas, plantations, and mature timber has been
replaced by extensive clearcut areas and remnant stands of rapidly decaying lodgepole pine
(FLNRO, 2012a). Throughout this landscape are numerous communities, that are a part of
this geography and which have been, and will continue to be, impacted by these agents of
change (FLNRO, 2012a; Parkins & MacKendrick, 2007; Patriquin, Wellstead & White,
2007). Unlike older communities located in the southern reaches of British Columbia, these
communities were established during the province building era and, as such, were
purposefully linked to the forest economy (Bowles et al., 2002; Markey et al., 2008).
Consequently, the majority of communities in the northern interior of British Columbia

22

remain highly dependent upon the forest economy (Halseth et al., 2010; Horne, 2009). The
forested landscape has changed and all of the things that depend on it, from people and
communities to flora and fauna, have been forced to adapt.

23

Chapter 3: Literature Review
3.1. Introduction
The forest industry has long been an economically important sector for British
Columbia (Hayter, 2000; Marchak, 1993). Not only is the industrialized forest sector
important, but so are the forest policies that govern it, as they have the capacity to impact
aspects of the province’s natural environment and its human communities (Burda & Gale,
1998; Markey et al., 2008). It is understandable then why major forest policy developments
of recent decades, such as the Forest Practices Code of British Columbia Act 1995, the
Forest and Range Practices Act 2004, and to some degree the Forest (Revitalization)
Amendment Act 2003, have drawn research interest from a diverse group of scholars, from
disciplines ranging from biology to sociology.
While the Forest Practices Code of British Columbia Act 1995, and the Forest and
Range Practices Act 2004 were/are about the regulation of forest operational and
management practices, the Forest (Revitalization) Amendment Act 2003 brought about
changes to the conditions by which private firms must abide in order to acquire and/or
maintain long term rights to harvest public timber. The focus of my research concerns how
the forest industry responded to the specific forest policy changes brought about by the
Forest (Revitalization) Amendment Act 2003. I approached my research from the
understanding that forest management involves complex interactions between natural
ecosystems and human systems and as such requires insight from the disciplines of both the
natural and social sciences.

24

In my broad survey of the literature regarding forest policy and the forest industry in
British Columbia, I focused specifically on the literature that spoke to change dynamics in
forest policy and the forest industry. This literature draws primarily from four disciplines:
political science; economics; sociology; and geography. Scholars from these disciplines have
sought to understand the dynamics of forest policy change as well as change dynamics within
the forest industry using a variety of theories, which are rooted in their specific disciplinary
ontologies. Despite the disciplinary focus, at least two separate but related paradoxical
observations continued to surface in this literature, in one form or another. The first
ambiguity described in the literature is that despite various changes in forest policy, business
carries on as usual. The second is that certain forest policies persist though they have been
shown not to be achieving their intended goals. It is the pursuit to understand these
contradictions surrounding British Columbia forest policy that makes this literature important
to my research.
The literature of change dynamics in forest policy and the forest industry lends itself
to understanding the unique nature of the British Columbia forest sector as well as
identifying potential factors that have influenced the dynamics of change within it over the
past several decades. I will begin by discussing what scholars have looked at in terms of
forest policy change. This discussion will be followed by a review of the various responses of
the forest industry to changes in forest policies in. Finally, I will discuss what scholars have
identified as enduring forest policy legacies.
3.2. Forest Policy Change in British Columbia
Forest policy in British Columbia has traditionally been studied by scholars within
the social science disciplines of political science and economics (Lindquist & Wellstead,

25

2001). Policy as it is used in this research is defined as, “the regulation of how, when, and
where” (Hessing, Howlett & Summerville, 2014, p. 3). Broadly speaking, policies can be
developed by any organization or group, however, for this inquiry the regulations are
developed by the provincial government (Hessing et al., 2014). Lindquist and Wellstead
(2001) contend that prior to the late 1980s, scholars studying forest policy change in the
province assumed a rather simplistic state of policy making between the provincial
government and the forest industry, and as such, little attention was paid to the actual
development of forest policy in British Columbia. Rather, the efforts of political scientists
were focused on how a policy was implemented and economists evaluated the effectiveness
of the outcomes (Lindquist & Wellstead, 2001). This section will show how the approach to
analyzing forest policy has changed over the past few decades.
Until the 1990s, the drivers of forest policy change in British Columbia remained
relatively consistent due to the strong relationship between the forest industry, government,
and labour (Hagerman, Dowlatabadi & Satterfield, 2010; Prudham, 2007). The era of implied
simplicity came to a close in the latter part of the 1980s in British Columbia when the policy
arena became more contested (Lindquist &Wellstead, 2001), triggered by the coordinated
effort of environmental non-governmental organizations and First Nations towards a
common interest in the environment (Lertzman, Rayner & Wilson, 1996). As the complexity
in forest policy dynamics increased in British Columbia, traditional approaches to policy
analysis became problematic so political scientists began to apply more robust theoretical
frameworks such as policy networks/communities and agenda setting theories to better
understand the forest policy dynamics occurring in British Columbia (Lindquist & Wellstead,
2001).

26

Early investigations of theoretical frameworks to explain forest policy change in
British Columbia began to emerge in the mid-1990s. What began as a controversy between
the roles of ideas versus interests in policy dynamics (Howlett & Rayner, 1995; Lertzman et
al., 1996; Hoberg, 1996) was later understood as an integration of ideas and interests
(Howlett & Ramesh, 1998). Similarly, Hoberg and Morawski (1997) discovered that using
policy network/sector theories to explain the dynamics occurring between the government
and First Nations regarding forest policy in Clayoquot Sound were inadequate. Moreover, in
his investigation of various agenda setting theories used to explain particular forest policies
in British Columbia, Kamieniecki (2000) found that these theories could not account for the
complexity of forest policy dynamics occurring in British Columbia.
To overcome these deficiencies in understanding the complexity of forest policy
dynamics, political scientists began to broaden their lens of inquiry, reaching beyond the
specificity of their own discipline. This research informed the broader context in which
British Columbia forest policy was taking place. In their comparative study of forest
jurisdictions, Cashore and Vertinsky (2000) found that a firm’s response to an external
pressure depends on the type of regulatory structure it is under as well as the type of
relationship it has with the government, demonstrating the important role of institutions.
Similarly, Bernstein and Cashore (2000) show how the globalization of economies and
communication and the internationalization of trade have provided international actors and
institutions with direct influence over domestic forest policies, citing the ability of the United
States to directly influence forest policy through the Softwood Lumber Agreement.
In the field of economics, forest economists draw from rationale choice theory and
the policy instrument framework to guide their analyses of specific forest policies to

27

determine their economic efficiency (Lindquist & Wellstead, 2001). For example, in their
assessment of British Columbia’s policy shift that resulted in British Columbia Timber Sales
(BCTS) replacing the Small Business Forest Enterprise Program (SBFEP), Niquidet, Nelson
and Vertinsky (2007) modeled characteristics of the sales that were thought to impact bid
prices. They found that the new program of timber tenure delivery through BCTS to be more
efficient than its predecessor, the SBFEP, though they suspected that resource rents may have
been transferred from rural communities to the provincial government (Niquidet et al., 2007).
Rational choice theory assumes that: “people’s preferences are static, society is a
mathematical aggregation of homogeneous rational agents, public inputs are through market
signals, and there is no role for any institution other than the market” (Kant, 2003, p. 40). As
such, reasoning that is based on rational choice theory can be problematic as it involves
minimal input parameters that results in an explanation that is over simplified (Kant, 2003).
Oversimplification in the analysis of forest policy instruments is starting to be recognized and
evidence demonstrating its limits can be found. For example, a long standing assumption by
forest economists was that by strengthening timber tenure rights in British Columbia firms
would make longer term investments in growing trees (Luckert, 2007; Zhang & Pearse,
1997). However, work by Arnot, Luckert and Boxall (2011) found that because there is no
firm definition of tenure security, tenure security cannot be linked to economic behaviour.
Further, Bogle and van Kooten (2013) have shown that government and firms have
conflicting agendas when it comes to growing trees because firms view the task as a liability
and constraint as opposed to an investment.
While the above noted scholars have all made valuable contributions to the
discourse regarding British Columbia forest policy, perhaps the most significant contribution,

28

in terms of understanding the dynamics of forest policy change in British Columbia, was
made by Rayner et al. (2001). They argue that while the forest sector is made up of many
sub-sectors, not all of them can be given equal scrutiny as some sub-sectors can be
determined to be critical in the sense that they exhibit substantial influence over the dynamics
occurring within the entire sector (Rayner et al., 2001). In their analyses of British Columbia
forest policy changes in the 1990s, they identified three factors that affect policy change in
the forest sector. First, that subsectors are organized around a small number of issues which
attract specific policy networks, as policy networks are interest based. Second, that
subsectors can be strongly linked together to support a policy goal, such as the policy of
sustained yield. Third, those critical subsectors occupy a position of privilege, in that they
“constrain policy development” (Rayner, et al., 2001, p. 329). They identified the tenure and
timber supply subsectors as critical because of their direct link to the wellbeing of the forest
industry (Rayner et al., 2001). In their research, Thielmann and Tollefson (2009) also found
that numerous attempts to change land use policy were thwarted by the commitment of
successive governments to uphold the forest industry and forestry jobs.
3.3. Responses by the Forest Industry to Policy Change in British Columbia
The historical relationship between the government of British Columbia and the
forest industry has been well documented (Marchak, 1983), which had become firmly
established following the Royal Commission on Forest Policy led by Sloan in 1945 (Prudham,
2007). But, this relationship began to be tested by the late 1980s when the environmental
movement and First Nations began to effectively challenge the historic relationship between
government and the forest industry (Cashore & Vertinsky, 2000). The following section will
show how the forest industry in British Columbia has adapted to forest policy change in order

29

to survive. This section will also describe the internal and external contexts of these
adaptations as the forest industry was not only responding to British Columbia forest policy,
but to the forest industry’s place within the global economy.
In their model to predict how firms will respond to external pressures, Cashore and
Vertinsky (2000) employ both policy network and regulatory typologies; they classify British
Columbia’s regulatory style as non-legal/discretionary and its forest policy network structure
as a clientele-pluralist network. In this model, the regulatory style refers to the role of the
courts, where the clientele-pluralist network is described as a network in which:
business interests are policy participants within the sub-government; state agencies
rely on business interests for advice; business interests essentially have a veto over
policy change; and, other organized interests are relegated to roles as policy
advocates (Cashore & Vertinsky, 2000, p. 5).
To demonstrate the progressive responses of firms to environmental pressure they use the
example of Canfor, a British Columbia forest company. At the beginning, in the mid-1980s,
Canfor used tactics of defiance, avoidance, and manipulation to thwart the pressure from
environmental groups who were targeting old growth logging and pulp mill pollution
(Cashore & Vertinsky, 2000). Here, Canfor outright dismissed the claims of the
environmental groups while leveraging their connections to government agencies to avoid
compliance with regulations (Cashore & Vertinsky, 2000).
It was not until environmental groups became more organized, threatening to bring
their fight to the market place, that Canfor responded in an accommodating and proactive
manner, voluntarily pledging to abate the pollution levels by building a modern pulping
facility (Cashore & Vertinsky, 2000). In this case, Cashore and Vertinsky (2000) argue that
by taking a proactive stance Canfor was able: “to maintain the clientele-pluralist network and
30

discretionary legal setting under which they operated” (p. 15). Citing Canfor’s proactive
approach in advocating for better forest practices and in obtaining sustainable forestry
certification, Cashore and Vertinsky (2000) speculate that Canfor may not have prevailed
within the market place or under a new government, formed by the NDP, had it not learned to
adapt its responses. Thus, they contend that Canfor was able to effectively portray an
environmentally friendly company to their customers while demonstrating to government
that companies can self-regulate (Cashore & Vertinsky, 2000).
Prior to the recession of the early 1980s, Edenhoffer and Hayter (2013a) describe
Canfor as a dominant integrated forest company operating primarily in the coastal region of
British Columbia. However, in response to the recession, Canfor moved the majority of its
operations from the coast to the interior of the province, and in 1983 became a publically
traded company (Edenhoffer & Hayter, 2013a). Using the investment dollars it received,
Canfor embarked on its corporate restructuring plan, which involved consolidation through
the acquisition of other firms, and rationalization through a number of cost saving measures
(Edenhoffer & Hayter, 2013a). Canfor survived the 1980s recession, and as such, Edenhoffer
and Hayter (2013a) postulate that at least parts of Canfor’s survival strategy were prevalent
throughout the industry.
A key aspect to this strategy of survival was the choice to pursue the mass
production of low cost commodities rather than value-added commodities (Edenhoffer &
Hayter, 2013a). They argue that not only did the pursuit of mass production lock in the
industry’s evolutionary trajectory, but it reinforced the business cycle of booms and busts,
which became increasingly more extreme and created greater instability (Edenhoffer &
Hayter, 2013a). Further, they contend that the uncertainty surrounding timber supply,

31

markets, and land use in British Columbia have in some ways forced forest corporations
towards making these kinds of choices (Edenhoffer & Hayter, 2013a). They note that another
key to Canfor’s survival was moving to the interior when it did. At the time, the timber
supply in the interior was more robust and there was less contention with First Nations than
there was on the coast (Edenhoffer & Hayter, 2013a). Between 1980 and 2010 Canfor tripled
in size in British Columbia while reducing its employment by half, and although Canfor
made substantial capital investments in the interior of British Columbia in response to the
mountain pine beetle, it has since made investments in the southern United States, using the
money refunded from the illegal duties collected between 2001 and 2005 as part of the
Softwood Lumber Agreement with the United States in 2006 (Edenhoffer & Hayter, 2013a).
In the broader context, Edenhoffer and Hayter (2013b) explain the evolutionary
trajectory of the British Columbia forest industry by combining the industry life cycle model
with the resource cycles model, as both models have similar phases, into what they call the
resource industry life cycle. This life cycle consists of four phases. The first phase of the
industry life cycle/resource cycle is that of pioneering/discovery, where the industry is
dominated by competitive entrepreneurs and resource exploitation is focused on that which is
in closest proximity and commands the highest value in the market. The second phase is the
growth/rapid expansion, where entrepreneurs are replaced by larger vertically and
horizontally integrated companies and extraction costs increase as the distance to the
resource increases. The third phase is maturity/plateau, where the innovation and technology
drive firms to gain competitive advantage and exploitation mentality depletes and degrades
the resource. The final phase is decline revival/decline and abandonment, where the decline
can be gradual until, in the case of industrialized forestry, the supply of timber collapses, but

32

until such time efficiencies continue to be sought and investments continue to be made
(Edenhoffer & Hayter, 2013b).
Using the tenets of the resource industry life cycle model, Edenhoffer and Hayter
(2013b) sketch out the development and evolution of the forest industry in British Columbia,
noting that its prolonged boom period not only produced large integrated firms, but also
helped to create what Freudenburg (1992) calls addictive resource economies. Although the
plateau stage cannot be precisely pin pointed in time, Edenhoffer and Hayter (2013b) claim
that the forest industry in British Columbia arrived on the plateau just as the recession of the
1980s began. They describe the plateau stage in British Columbia as one in which the
industry is dominated by large vertically and horizontally integrated firms, stating that as
resource exploitation expands and moves farther away from distribution hubs companies
must leverage economies of scale in order to keep costs down, which is accomplished
through mass production (Edenhoffer & Hayter, 2013b). The pursuit of mass production is
still predominant in forest industry as Nelson, Cohen, and Nikolakis (2009) found that mills
in British Columbia favour maximizing production over maximizing value.
Just like the plateau phase, the decline phase is not a precise point in time, rather, it
can be tumultuous and drawn out, filled with short lived revivals (Edenhoffer & Hayter,
2013b). Edenhoffer and Hayter (2013b) suggest that since the 1980s, restructuring in the
British Columbia forest industry has been a matter of survival, stating that: “resource
exploitation contains an internal dynamic of self-destruction and, as growth levels out in the
plateau stage, decline and closure become possibilities” (p. 141). Despite the mountain pine
beetle epidemic, Edenhoffer and Hayter (2013b) say that production in the forest industry
peaked around 1987, which is indicative of the industry leveling out. They argue that the

33

recession of the 1980s was the catalyst of change for the British Columbia forest industry, as
it was the crisis that triggered the softwood lumber trade dispute with the United States, the
rise of societal protest against industrial forestry, and the subsequent re-regulation of the
industry (Edenhoffer & Hayter, 2013b).
In terms of the re-regulation of the industry, Binkley and Zhang (1998) measured
the response of stock holders when the NDP government in British Columbia raised
stumpage rates in 1994 in an effort to appease the Americans over the claim that the
government of British Columbia was subsidizing industry. Using an event study of stock
prices, they found that the stock prices of publically traded companies fell on the day that the
government announced the changes to stumpage rates. Binkley and Zhang (1998) interpreted
as a negative reaction by stock holders to the news of increasing stumpage rates. A similar
study was done by Niquidet (2008) to measure the reaction in the stock market to the
announcement of the Forest Revitalization Plan and the intended expropriation of 20% of the
volume from major licensees. In his measure of thirteen forestry firms in British Columbia,
only a few showed a significant negative response (Niquidet, 2008). Further inquiry
prompted Niquidet (2008) to ascertain that the negative reaction had to do with a perceived
loss of property rights.
These findings are interesting, because the re-regulation of 1994 was quite different
from the re-regulation of 2003. The 1994 stumpage rates were increased by $12/m3 on
average, which does not seem like a substantial amount, but based on lumber prices at the
time the increase came into effect on May 1, 1994, it represented an 81.1% increase for the
Interior and 64.4% increase on the coast (Binkley & Zhang, 1998). The study by Binkley and
Zhang (1998) shows the reaction of shareholders to the arbitrary increase made by

34

government to the price of timber. There is evidence to support that the increased stumpage
in 1994 was viewed negatively by shareholders as it significantly increased the cost of supply,
whereas in 2003, the timber expropriated was compensated for. Niquidet (2008) suggests that
shareholders perceived a loss of rights and hypothesizes that the 20% take back of timber
volume represented not only a loss of security, in the form of property rights, but would
result in less control of the timber supply for major licensees. Niquidet’s (2008) hypothesis
lacks supportive evidence given that expected compensation paid by the government to the
licensees was to be $200 million, equating to approximately $24/m3. Further, Pinkerton,
Heaslip, Silver, and Furman (2008) assert that the changes that accompanied the
expropriation, specifically those changes brought in by Bill 29, allowed the major licensees
to consolidate their control of the allowable annual cut (AAC) which further solidified their
oligopsony.
In their comparison of three forest jurisdictions, British Columbia, New Zealand,
and Tasmania, Hayter and Barnes (2012) explore how neoliberal ideology has been
expressed in these three different geographies. Although, neoliberal ideology began to
influence the government regulation of the forest industry in British Columbia beginning in
the 1980s and 1990s, Hayter and Barnes (2012) contend that neoliberalism was not directly
applied to British Columbia forest policy until the 2000s. Lindquist, Langford and Vakil
(2010) agree as they consider British Columbia behind the times in terms of neoliberal
influence. Young and Matthews (2007) state that the BC Liberals, elected in 2001, directly
ushered neoliberalism into the forest economy in three ways, by liberalizing licensee rights
through Bill 29, by liberalizing the market through Bill 29, and by liberalizing space through
various amendments to the Forest Act 1996 and through the Forest and Range Practices Act.

35

Similarly, Humphreys (2009) states that neoliberal mechanisms of marketization,
public/private partnerships, and deregulation are found throughout international forest
management. The BC Liberal Party may have ushered in neoliberal ideology in British
Columbia, but according to Humphreys (2009): “[n]eoliberalism is very much the hegemonic
ideology of our age” (p. 320).
3.4. British Columbia Forest Policy Legacies
The British Columbia forest policies that have been identified as legacies in the
literature are policies regarding timber tenures, timber supply, and timber pricing. All of
these policies support the larger underlying forest policy of regulating the forest harvest using
the sustained yield model (Rayner et al., 2001). Despite mounting evidence that the policy
does not work (Prudham, 2007), and that public expectation for sustainable forestry is rising
(Rayner et al., 2001), the sustained yield forest regulation policy remains steadfastly in place,
with the current provincial allowable annual cut (AAC) set at 75.8 million cubic metres per
year (FLNRO, 2016b). The questions being raised in the literature are asking why these
forest policies persist (Burda & Gale, 1998; Fréchette & Lewis, 2011; Prudham, 2007;
Rayner et al., 2001).
Following the Royal Commission on Forestry led by Sloan in 1945, changes were
made to the Forest Act in 1947 which enshrined sustained yield forest regulation as the
doctrine to liquidate old growth and create in its place an even-aged predicable flow of
timber, revenue, and stability (Prudham, 2007). Rayner et al. (2001) agree, noting that in
theory, sustained yield forest regulation would uphold the forest industry which in turn would
provide revenue to the Crown and employment stability for communities. Indeed, it could be
argued that the policy of sustained yield enabled the forest industry to expand into the

36

Interior of the province during W. A. C. Bennett’s province building era (Marchak, 1983).
However, although the sustained yield forest regulation model was institutionalized in British
Columbia in 1947, it does not mean that this model has been effective (Prudham, 2007).
Prudham (2007) argues that the ideology underpinning sustained yield forest policy:
“allow[s] forests to circulate as financial capital” (p. 259). During the post-World War II era,
the time period at which sustained yield forest policy was introduced, Prudham (2007) notes
that: “ideas of nature and work were very much linked in BC” (p. 259); meaning that the
forest policy fit easily with the context of the time and place. He notes that some of the
unique aspects of this forest regulation model to British Columbia were that it granted private
capital exclusive rights to harvest timber, was managed by scientific forestry and linked
community economic well-being directly to the exploitation of the forest resources (Prudham,
2007). Thus, he contends that support for sustained yield forest regulation was garnered
because the forest industry, the state, and organized labour all stood to benefit from this
model (Prudham, 2007).
Challenging the policy goal that sustained yield forest regulation to provide
stability to communities, Byron (1978) examined unemployment in Quesnel and Prince
George from the period of 1967 to 1975. In this research, he compared the degree of
instability of employment in occupational groups for both cities. In the study, to allow
reasonable comparison, Byron (1978) looked at the relative instability and absolute
variability for each group. The data support the postulation that the volatility of lumber
markets causes fluctuations in forest sector employment, in which there is a lag of one to two
months between the cause and effect (Byron, 1978). Byron (1978) further argues that
employment instability in small forest-dependent economies is a social issue which cannot be

37

solved using sustained yield forest policy concluding, “the permanence or survival of forest
industry centres is neither assured by nor solely dependent upon the perpetual maintenance of
nearby forests at or near sustained yield levels” (p. 61).
Despite these findings by Byron (1978), sustained yield forest regulation has
prevailed and as a result, the province’s allowable annual cut (AAC) has tripled since the
1950s (Burda & Gale, 1998). Burda and Gale (1998) argue that the mass volume production
of commodity products that dominates the British Columbia forest industry benefits private
firms and does not maximize jobs, provincial revenue, or community stability. They identify
that decreasing timber supply, increasing costs to extract timber, and increasing barriers to
the market in the United States all pose significant threats to this timber manufacturing
choice (Burda & Gale, 1998). Taking the aforementioned threats to the industry into
consideration, Burda and Gale (1998) contend that a commitment to high volume depletion
via sustained yield forest regulation has the potential to have crippling long term economic
consequences for the province in the future.
This policy of sustained yield has also survived the legislative changes of recent
decades which govern the operational practices of the forest industry. While examining the
various policy changes brought about by the NDP government in British Columbia in the
1990s, Rayner et al. (2001) were interested to find that while the Forest Practices Code Act
substantially changed the operational practices of industrial forestry to be conducted at a
higher environmental standard, other policies, such as the allocation of timber through the
forest tenure system and the allowable annual cut (AAC) remained virtually unchanged
(Rayner et al., 2001). Although conflict between the environmental movement and the
industrial forestry sector in British Columbia had been on the rise since the 1980s, Rayner et

38

al. (2001) note that by the 1990s, the environmental movement had gained considerable
support and subsequent political influence. However, they also recognize that supporting the
forest industry had itself become a policy, and a key mandate of the ministry responsible for
forests (Rayner et al., 2001). Hence, because the forest industry remained an important
economic feature in British Columbia, they argue that it continued to have substantial
influence over forest policy stating that: “[…] authority over policy formulation and
implementation remained in the hands of the same community of experts who, by and large,
remained quite supportive of the status quo” (p. 325).
In the 2000s, the Liberal government replaced the Forest Practices Code Act 1995
with a results-based version, the Forest and Range Practices Act 2004, which is essentially a
performance-based framework (Hoberg & Malkinson, 2013). However, unlike other forest
jurisdictions, it is the licensee that sets the result or strategy to achieve the eleven values
established in the Forest and Range Practices Act by government (Hoberg & Malkinson,
2013). Peterson and Stuart (2014) contend that the traditional reliance by successive British
Columbia governments upon the forest industry to provide jobs and stability via the
extraction of timber has ultimately led to the erosion of the government’s regulatory power.
Citing the mountain pine beetle epidemic, they claim that because of the Forest and Range
Practices Act the government could not direct the licensees to harvest the mountain pine
beetle infested stands (Peterson & Stuart, 2014). As a result, licensees harvested in the green
timber longer than they should have, sacrificing long term viability for short term gain
(Peterson & Stuart, 2014). While Peterson and Stuart (2014) argue that the forest industry
continues to act in its own best interest and that the government has little ability to change the
situation, they also note that the government appears to be committed to business as usual.

39

Nelson (2007) agrees that the forest industry focused on maximizing its own interests by
harvesting as much profitable timber as possible. But, he also says that the forest industry
only changed its focus to harvesting as much green timber as possible because it was
unsuccessful in lobbying the government to address the growing mountain pine beetle
epidemic (Nelson, 2007).
There are several elements noted earlier in this section that merit further discussion
as they provide greater insight into why sustained yield forest regulation persists in British
Columbia. The first is that the underlying goal of sustained yield forest regulation, the
accelerated liquidation of old growth timber, which is founded on an ideology that views the
forest as a commodity to be exploited (Prudham, 2007). The second is that the relationship
between the forest industry and government and, to a lesser extent, labour is founded on
agreement to support sustained yield forest regulation (Prudham, 2007). The third is that the
relationship between the forest industry and government is not exclusively between the
elected officials and the forest industry, but between the forest industry and the bureaucracy,
namely the ministry responsible for forests (Rayner et al., 2001). What the first two things
tell us is that not only is the commitment to this model strong, but that the model of sustained
yield has an ideological foundation. What the third thing tells us is that this ideology of
sustained yield also has an institutional context.
To consider change dynamics in the governance of forests one must consider
underlying ideologies (Humphreys, 2007) and institutions (Fréchette & Lewis, 2011).
Humphreys (2009) states that an ideology is very different from knowledge, in that the
former offers both a critique on how things are perceived and an alternative to that which is
being critiqued, whereas the latter is defined as fact that is both verifiable and believed.

40

Given that an ideology is based on morals, any individual or group may subscribe to the
ideology, however, this is not to say that acceptance of a given ideology is universal, rather,
that it is relative (Humphreys, 2009). Fréchette and Lewis (2011) regard institutions as
enduring fixtures in human society that are resistant to change.
It is helpful at this point to define what institutions are. For the purpose of this
investigation, institutions are defined as: “the formal rules, compliance procedures and
standard operating procedures that structure the relationship between people in various units
of the polity and economy” (Hall, 1986, p. 7). As such, Fréchette and Lewis (2011) argue
that: “[o]nce produced, rules may become entrenched for a number of reasons” (p. 583).
They elaborate by saying that the rules can become entrenched for the following reasons: that
rules exist in complex inter-dependent arrangements both vertically within the hierarchy of
rules and horizontally with other rules; that changing the rules would often be considered too
costly; and, they have a tendency to be captured by the interests that stand to benefit the most
(Fréchette & Lewis, 2011). Moreover, Fréchette and Lewis (2011) argue that because
institutions tend to provide greater certainty for vested interests, any change that would
threaten that certainty would be opposed. Finally, they stress the importance of identifying
what the rules to change the rules are, and who has the power to change them. In Canada, the
authority to manage provincial forests resides with the respective governments of each
province (Fréchette & Lewis, 2011).
In terms of the institutional context of sustained yield forest regulation, Prudham
(2007) describes the British Columbia forest sector as a command and control system that is
only accessible by those with elite knowledge, and that the professional forest management
system is dominated by forest professionals, who occupy positions within the forest industry

41

and the bureaucracy. Sustained yield forest regulation was part of the scientific forestry
model endorsed by Sloan as part of the recommendations in the 1945-1947 Royal
Commission on Forestry in British Columbia (Prudham, 2007). That sustained yield is
considered a component of scientific forestry means that it is part of the curriculum that is
taught to aspiring forest professionals (Prudham, 2007). So, just as sustained yield forest
regulation became entrenched within the ministry responsible for forests, becoming part of
the institutional fabric, it also became a conduit for perpetuating the ideology through time
because of its connection to the forestry profession (Prudham, 2007).
In his discussion, Humphreys (2009) defines discourse as: “a set of linked
understandings and ideas that structure how people think about, interpret and understand the
world” (p. 319). He further argues that: “different discourses may achieve different degrees
of political influence in social life […and] may gain considerable political influence while
lacking a clear epistemic basis” (p. 320). What Humphreys (2009) is saying is that the power
behind an ideological discourse is not in its ability to prove itself viable, but that it is morally
accepted by those who adhere to it. Given that sustained yield forest regulation remains in
place, despite its failure as a policy instrument to secure employment and stabilize the
industry of the forest sector, indicates that the ideology supporting it is predicated on moral
rather than epistemic relativism (Humphreys, 2009). In summary, it could be argued that the
persistence of sustained yield forest regulation in British Columbia can be explained by its
institutional framework that is informed by ideology. Institutional frameworks are important
because they: “define the ends and shape the means by which interests are determined and
pursued” (Scott, 1987, p. 508).

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Chapter 4: Methodology and Methods
4.1. Introduction
My research focuses on forest policy change in British Columbia, a subject matter
that can be laden with contention and polarizing viewpoints (Howlett, Rayner & Tollefson,
2009). Knowing this, I wanted to undertake my research in a more holistic manner with the
goal to gain a balanced understanding of the data. I also considered what the constraints and
barriers to this research might be and how I would be situated in this research (Guba &
Lincoln, 2004). Methodology involves more than the way in which we collect and measure
data, it is the framework from which we approach research, how we decide what to
investigate, and how we will go about studying it (Guba & Lincoln, 2004). The framework of
research comes from our own ontology, or how we see reality, and our personal
epistemology, or how we go about understanding reality (Guba & Lincoln, 2004; Jones &
Gomez 2010).
I used a mixed methods approach, which leveraged both qualitative and quantitative
methods to conduct my research. The mixed methods approach can add breadth and depth to
the research, expanding the possibilities of discovery while allowing for triangulation
(Greene, Caracelli & Graham, 1989; Moran-Ellis, Alexander, Cronin, Dickinson, Fielding,
Sleney & Thomas, 2006). The concept of triangulation comes from the navigational
technique of using two known points to calculate the location of a third point, in the same
way, data gathered from different sources and analysed in different ways converges in
support of the findings (Jick, 1979; Tashakkori & Teddlie, 1998). My intention in using
mixed methods was also to allow for the expansion of discovery, where the findings from

43

one source of data informed the collection of subsequent data (Greene et al., 1989), which
also enforced the rigour of my research (Baxter & Elyes, 1997).
As a result of working for twenty years in different capacities within the forest
industry in British Columbia I have a good understanding of the operational aspects therein.
Therefore, I had to be all the more diligent to ensure that I applied rigour throughout my
research process so that the research findings could be assessed as being trustworthy (Baxter
& Elyes, 1997). As a means of enforcing the rigour in my research, checking my subjectivity
(Bailey, White & Pain, 1999; Madge, Raghuram, Skelton, Willis & Williams, 1997), and
monitoring for power relationships (Bailey et al., 1994; Katz, 1994), I adopted the practice of
critical self-reflexivity when I first began formulating my research topic. I have used the
practice of critical self-reflexivity throughout this research project not only to evaluate my
goals and approaches, but to think about the ethical aspects of my research (Dowling, 2010).
Therefore, disclosing my position as a member of the forestry profession when I introduced
myself as a researcher became an important aspect of my research because it has undoubtedly
influenced the questions that I have asked, the way that I perceived the data, and the way that
I present the findings (Behar, 1996; Clifford, 1986; England, 1994).
My position within this research is that I am both an insider and an outsider
(England, 1994; Kobayashi, 1994). I am an insider in that I live and work within the case
study area and my career is in the forest sector. I am a Registered Professional Forester, and I
am a public servant with the province of British Columbia, working at the Ministry of Forests,
Lands and Natural Resource Operations. I am an outsider in that my inside position has not
afforded me a privileged or complete understanding. Rather, I am, “situated as dweller and
sojourner within my own fields of knowledge” (Clifford, 1997, p. 218). The duality of my

44

position as the researcher, being both an insider and an outsider, has been challenging to
manage. While my experience working within the forest sector for many years and in many
roles has given me insight to aspects of forest policy and management, it has not given me a
total comprehension. As Clifford (1986) contends: “[c]ulture, and our views of “it”, [are]
produced historically, and are actively contested. There is no whole picture that can be ‘filled
in’, since the perception and filling of a gap leads to the awareness of other gaps” (p. 18). I
agree with Clifford (1986); during my research journey I no sooner understood some aspect
of the forest industry or answered a particular question, only to unearth more gaps in my
understanding in the process. Challenging the assumptions upon which my knowledge is
based has been a humbling experience.
4.2. Ethical Considerations
My intention was to interview people as a means of collecting data for my research.
It is common for academic institutions to require some form of ethical review when human
subjects are involved in research (Dowling, 2010). Therefore, I sought approval from the
University of Northern British Columbia Research Ethics Board and was granted approval on
May 16, 2014. See Appendix 1 for a copy of the approval letter. Prior to embarking on the
interview phase of the research I considered what some of the ethical challenges might be
and decided that they would likely be: effectively managing power relationships; and,
potentially crossing boundaries between my professional ethics and my own moral and
ethical framework.
Whether you are an insider or an outsider, as the researcher you must always
consider the well-being of the participants that your research involves (England, 1994;
Kobayashi, 1994). Honesty in the approach of a topic and critical evaluation of self in the

45

context of being the researcher are important practices that can help the researcher, protect
the participants from harm, and safeguard from the potential of the researcher exploiting the
participants (Dowling, 2010; England, 1994; Nast, 1994). As the researcher, it was important
for me to remind myself that power, knowledge, and ethics are interwoven (Madge et al.,
1997). Power relationships can be relatively equal in terms of what the researcher and
participant stand to benefit or it can be unbalanced, either to the advantage, or disadvantage
of the researcher (England, 1994). Power relationships can also be quite fluid, changing
during the course of the research, or as a result of the research (Kobayashi 1994). There is no
particular method that will eliminate the power relations inherent in qualitative research
(Dowling, 2010; England, 1994; Gilbert, 1994, Katz, 1994; Kobayashi, 1994, Nast, 1994).
The best way to keep them in check is through self-reflexivity (Bailey et al., 1999; England,
1994; Katz, 1994).
Although I did not identify any tangible risks for those wishing to participate, I did
fully disclose my identity as a knowledgeable practitioner of twenty years working in the
forest sector and currently employed as a Registered Professional Forester with the Ministry
of Forests, Lands and Natural Resource Operations. I assured the participants that the
research I was conducting was my own and not that of my employer. I gave disclosure of my
position to potential participants during the solicitation process which helped to establish a
baseline of honest communication between them and myself. To further ensure the protection
and well-being of the participants, I have kept their identities confidential.
What I discovered, however, was that there was more to preserving anonymity of
the participants than just assigning a unique alpha-numeric identifier. There were things that
were revealed by participants during the interview process that I could not report in my thesis

46

because to do so would compromise the anonymity of certain participants. Furthermore, I
purposely chose not to cite participants in the themes generated through content analysis
because I felt there was a risk of participants being identified through the associated theme
tables. I even scrutinized the use of direct quotes in this section to ensure that I was not
inadvertently revealing identities.
4.3. Research Design
I wanted to investigate how forest corporations have responded to the forest policy
changes made by the government of British Columbia in 2003, which may have subsequently
impacted the forest industry. My goal was to understand the context of these changes more
comprehensively, and in so doing, perhaps uncover some linkages that may have eluded
policy makers. Initially I was interested in grounded theory as a research technique. However,
with a restricted time frame and resources this approach could not be employed and used
properly. Instead, I decided to use a case study as a way of organizing my research
strategically.
Case studies have been used extensively in social science research and for a variety
of purposes (Tight, 2010; Yin, 1994). Historically, ambiguity surrounds the use of case
studies concerning the question of whether a case study is a method, a methodology, or
merely an example of some specific phenomenon (Baxter, 2010; Tight, 2010; Yin, 1994). As
such, many social researchers regard it as an inferior qualitative method; yet, it can provide
robust explanations from complex social phenomenon (Baxter, 2010; Yin, 1994). The
structure of the case study lends itself to the use of mixed methods, allowing the researcher to
fully explore a given phenomenon within the context it is occurring (Baxter & Jack, 2008).
The case study also provides a format in which the convergence of data can occur, which in

47

turn gives the research credibility (Baxter & Jack, 2008). Moreover, the construct of a case
study research design permits the researcher to investigate ‘why’ and ‘how’ a phenomenon is
occurring, which gives the findings of the research a degree of generalizability in that
concepts uncovered can be transferred to other cases (Baxter & Jack, 2008). In this research,
the case study was used as a research strategy to purposefully focus data collection and
analysis (Yin, 1994).
The topic of this research is complex, involving multiple variables whose
relationships to the events in question are unclear. A case study is a research strategy that
places boundaries around the topic in such a way that it focuses the data collection and
analysis within the context of the real world (Yin, 1994). Though it appears very rigid
because it places boundaries, it is in fact flexible and promotes the collection of evidence
from multiple sources (Yin, 1994). To assist with the conceptualization of the case (Stake in
Tight, 2010), I considered the following questions:
1) Has the number and distribution of sawmills changed over time? If so, what has
driven this change?
2) Has the fibre flow changed? If so, how has it changed, and what does this change
potentially mean for the forest industry?
Asking these questions led me to decide to restrict the case study both in space and in time. I
chose the Prince George Timber Supply Area as the geographic boundary and a fifteen year
time period from January 1, 1997 to December 31, 2011.
4.3.1. The Case Study
I chose the Prince George Timber Supply Area as the geographic region for this case
study. It consists of three forest Districts: Prince George, Vanderhoof, and Fort St. James (see

48

Figure 1 for a map of the study area). I chose to make the case study within the geographic
boundaries of a Timber Supply Area (TSA) for two reasons: 1) the TSA is the geographic
unit in which the allowable annual cut (AAC) is determined; and, 2) TSAs contain
administrative units known as Districts, which are geographic units in which harvesting and
scaling data can traced. The Prince George Timber Supply Area (TSA) includes the
municipalities of Prince George, Fort St. James, and Vanderhoof, as well as other smaller
communities such as Hixon, Fraser Lake, Sinclair Mills, Bear Lake, and McLeod Lake
(Snetsinger, 2011). In addition, 24 First Nations have asserted traditional territories within
the TSA (Snetsinger, 2011). I chose the Prince George TSA because it is unique in the sense
that it has varying timber types across the forest District landscapes (Snetsinger, 2011), and
varying levels of forest dependence within the communities (Horne, 2009). As well, this TSA
is the largest contributor of volume in the province, and accounts for more than 40% of the
Northern Interior forest region’s TSA contribution (FLNRO “AACTSA”, n.d.). I chose the
period of 1997 to 2011 primarily for two reasons. The first was that I wanted to have data
that would reflect the period prior to the change in forest policy in 2003 and the period
afterwards. The second was that I began extracting numerical data from a publicly accessible
provincial database in 2012 and the public records only go back for a span of 15 years. For
this case, 1997 was the oldest year of data I could collect using public access.

49

Figure 1. Map of the Prince George Timber Supply Area

Source: Map retrieved from http://www.for.gov.bc.ca/hts/tsa/tsa24/map.gif

50

Finally, for the purpose of my research, I defined forest corporations as being major
primary timber manufacturing companies with production capacities large enough to be
classified as medium to large by the ministry responsible for forests3 in the province of
British Columbia. In British Columbia, lumber manufacturing accounts for the majority of
total primary manufacture of timber (FLNRO, 2011a), thus, my research focuses on lumber
manufacturing companies within the Prince George Timber Supply Area.
4.4. Data Collection and Analyses
I gathered data from both primary and secondary sources using a mixed methods
approach, with the collection and analysis of the secondary data preceding and informing the
collection of the primary data. The essence and complexity of the bigger picture within my
research questions demanded that I investigate more than one source of data. In fact, I believe
that the following sources of data I have used are interrelated in terms of the research
questions and cannot be understood independently as such (Gaber & Gaber, 2007). A mixed
method approach to the analysis of the data was used because the data were not collected in
the same way and as such cannot be lumped together and analyzed as an aggregate (Brannen,
2005). All data collected, regardless of method, were within the scope of the case study
parameters of both space and time. For clarity, I have chosen to present the methods of data
collection and analysis by topic area the data were collected for.
4.4.1. Mill Closures
I used three sources to collect secondary qualitative data: media outlets; corporate
annual reports; and official state documents (Bryman, 2008). These data were first collected
between October 2011 and March 2012. I conducted a media scan of the Prince George
3

I am using the generic term ‘ministry responsible for forests’ to avoid confusion because the ministry has
undergone several name changes throughout its time.
51

Citizen newspaper using an electronic database subscribed to by the University of Northern
British Columbia. I searched for news surrounding closures, start-ups, shut downs, and
upgrades involving lumber manufacturing companies located within the Prince George
Timber Supply Area. From the data that I collected, I extracted specific information about
lumber manufacturing companies, which I tracked in a table that I constructed in a Word
document. To better understand the context of sawmill closures and openings within the
Prince George Timber Supply Area, other events linked to the forest industry and occurring
between 1997 and 2011 were mapped out alongside the sawmill closures and openings to see
if there was any correlation between them (see Appendix II for details).
I used annual reports from forest corporations and the provincial government that
were available to the public, as well as official documents published by the Government of
British Columbia through the ministry responsible for forests to further inform my
understanding of the events taking place within the Prince George Timber Supply Area. I
analyzed these data using qualitative document analysis techniques because I was interested
in themes and patterns of words to provide context rather than in the mere frequency of
words (Altheide, Coyle, DeVriese & Schneider, 2008). I looked for themes that would help
explain the trends identified in the numerical data and this inquiry yielded several themes
which I added to the table tracking the closings, openings, and upgrading of sawmills. These
themes were also used to help generate interview questions.
During the examination of the results, I conducted a broader media scan regarding
the closures of mills picked up in the initial media scan. The second media scan was used to
uncover other details which might help to explain the particular circumstances surrounding
each mill closure. In August of 2015 I looked for internet based media accounts of each mill

52

closure using the Google search engine as well as searching the Prince George Citizen and
Vancouver Sun newspapers using an electronic database.
4.4.2. Employment
In February 2012, employment statistics were collected from BC Statistics using the
electronic database for BC Statistics. The employment statistics were extracted by industry
and development region, as well as employment/unemployment rates by industry for the
Cariboo and North Coast/Nechako regions. There was no secondary inspection of this data
set. The data were examined to see if there were any obvious trends. During this data
collection from BC Statistics, I discovered a special set of analyses that had been done by
Horne (2009) for the provincial government where data collected for BC Stats and Statistics
Canada were reconfigured to align with Forest District boundaries. Unofficial job loss
numbers associated with specific sawmill closures in the Prince George Timber Supply Area
were collected in the broader media scan of sawmill closures that was conducted in August,
2015.
4.4.3. Timber Harvest and Valuation
In British Columbia, the scaling of timber calculates the volume and grade (quality)
of logs, and the timber mark tracks all timber volume from its origin to its destination.
(FLNRO, 2011b). The appraisal of timber is regulated by the provincial appraisal manuals
and stumpage rates for timber are set by the timber mark of the cutting authority (FLNRO,
2011b). The Harvest Billing System (HBS), introduced in 2003, is the provincial electronic
database that tracks and manages all of the timber that is harvested by managing the scaling
data, which in turn in conjunction with stumpage rates are used to generate stumpage billing
(FLNRO, 2011b). The Harvest Billing System (HBS) is an open database system containing

53

both current and historical scale and billing data. Historical data are limited depending on
what is being queried. For this data collection, historical data were available up to 15 years
prior to the year of inquiry. I used HBS to gather data on where timber in the Prince George
Timber Supply Area was harvested and scaled, what species were scaled, and how much
stumpage was collected for the timber scaled.
To help answer the question of how industry was responding to the changes made to
legislation I wanted to look at where timber was being harvested by forest licence holders
within the Prince George Timber Supply Area and where it was being scaled. I extracted data
from HBS in March of 2012. Initially I ran reports for every year from 1997 to 2011 setting
the filter parameters to restrict the harvest to the District and by forest licences, and the report
configuration parameters to be grouped by District scaled and scale site. I also included
volume, value, species and grades within the report configuration parameters. I discovered
cruise based scaling in the 2010 and 2011 data so I had to run additional reports so that I
could sort out the data. A cruise based scale means that the timber is scaled on the stump, in
the District in which it is harvested in, rather than at the mill (MFR, 2010a). To extract the
destination information I ran reports on each District cruise based scale site by timber mark
so that timber marks belonging to forest licences could be extracted and the destinations of
the timber could be adjusted accordingly.
I also ran reports on each District from 1997 to 2011 setting the filter parameters to
restrict the harvest by District and by Crown Land, and the report configuration parameters to
be grouped by management type. Management types are: community forest agreements
(CFAs); woodlots; tree farm licences (TFLs); outside (not under management) and; Timber
Supply Area (TSA). Using the data in these additional reports, I was able to do two things:

54

compare the total harvest within a District to that under TSA and also determine the
proportion of the TSA harvest that was under forest licence; and cross check the data I
gathered to ensure the accuracy of the queries I used for generating reports. In all, 32 reports
were generated for each District of the three Districts for a total of 96 reports.
I conducted secondary analyses on the data collected in 2012. These analyses are
considered secondary because the data were collected by another organization for a different
purpose (Bryman, 2008). My purpose of doing these analyses was to answer questions
regarding timber harvested by forest licences in the Prince George Timber Supply Area.
Namely, where was timber harvested and what species were included in these harvests,
where was the harvested timber processed, and what was the revenue generated through
stumpage for the Crown. For these analyses I used Excel spreadsheets to manage and analyze
the data. Though the data collection occurred in 2012, the analyses were conducted at various
times as new information was acquired, or new gaps in knowledge were identified, with the
exception of the fifth analysis, where data were extracted in 2015. The 2015 data extraction
was done to simplify the extraction and amalgamation of data. Secondary analyses were also
conducted with these data.
In the first analysis I sought to answer the question of how much timber harvested
within a District was also processed there, and so, I compiled the data by year, location of
harvest, and scale. Next, I summarized how much of the harvest within each District was
scaled in that same District for each year from 1997 to 2011. In the second analysis, I looked
at the total amount of timber harvested within the Prince George Timber Supply Area and
how much revenue it generated for the province. I compiled the total harvest for all three
Districts for each year from 1997 to 2011 and compared it to the total revenue that was

55

generated from each harvest year for the Crown. Next, to account for inflation I used an
online inflation calculator found on the Bank of Canada website to calculate each year’s total
value to 2011 dollars (Bank of Canada, n.d.).
Based on the results of the analyses noted above, as well concerns that were raised
by a number of people I interviewed, I conducted a third analysis on lodgepole pine. In this
case I looked at the data from 2000 to 2011 for each District. I chose the starting year of 2000
for three reasons: 1) in 2000, the mountain pine beetle was active in all three Districts; 2) in
2001, the first mountain Pine Beetle Action Plan was released, and; 3) in 2002, the first uplift
in the allowable annual cut (AAC) was put into effect to address mountain pine beetle
epidemic. For the third analysis, to determine the relative proportion of lodgepole pine
harvested within each District by forest licences, I compiled the harvest data collected in
2012 in a spreadsheet by District for the years 2000 to 2011. I sorted the data for each year
by species where I was able to sum the volumes of lodgepole pine and the volumes of all
other species. Using the total volumes of lodgepole pine and all other species, I was able to
determine the harvest of lodgepole pine relative to all other species by year and by District.
For the fourth analysis, I isolated the lodgepole pine data from all Districts and
sorted it by year and then by log grade. Isolating the lodgepole pine gave me the ability to
sum the log grades by year and see the distribution of log grades by volume proportion from
2000 to 2011. For this inquiry, because there were changes made to the Interior log grades in
2006 (FLNRO, 2011b), and that “Stand as a Whole Pricing” was introduced in 2010 (MFR,
2010c), I decided to amalgamate the log grades into two categories: off grade and sawlog
grade. The off grade category included grades 3, 4, 5, 6, 7, and 8, whereas the sawlog
category included grades (blank), 1, and 2. It is important to acknowledge that there is a

56

difference between a scaled grade and a cruise based billing in terms of the timber appraisal.
The term “scale based” means the stumpage payable is based on the scale of the timber in
accordance with Part 6 of the Forest Act (MFR, 2010c, p. 1-5). Conversely, “Stand as a
Whole (SAAW) Pricing” (cruise based) means that one stumpage rate is determined for all of
the net merchantable timber on the cutting authority area. Therefore, for a cruise based
cutting authority, the single stumpage rate applies to all of the net merchantable volume
identified in the cruise conducted in accordance with the Cruising Manual, (MFR, 2010c, p.
1-5). What I have termed grades, particularly grades 7 and 8, are actually billing codes in
HBS (MFR, 2010a). So, for the purpose of this case, the term grade and billing code are
considered to be the same.
To better understand the decline in stumpage revenue from 2006 to 2011, I extracted
data from HBS in December of 2015. As I was not interested in isolating the harvest by
District for each year, a new data extraction would simplify the review. I ran a series of 12
reports, one for each year starting in 2000 and ending in 2011. In each year I set the filter
parameters to restrict the harvest by forest licences and organise the data by management
type so that I could extract the data for the Prince George Timber Supply Area (Timber
Supply Area 24). I also included in the reports volume, value, and species and grade. For the
fifth and final analysis, I extracted the data from the reports into an Excel spreadsheet, with a
tab for each year. With the data now assembled by year, I was able to sort by species and
associated grades as well as sum volumes and associated dollar values.
In this probe, for each year I separated the lodgepole pine from all of the other
species. I then tallied the volumes and associated values so as to calculate the average
stumpage rate paid by forest licences for lodgepole pine and for all other species. For each

57

year I used mathematical formulas to calculate the average stumpage rates for the following
categories: all lodgepole pine; lodgepole pine sawlog grade; lodgepole pine off grade; all
other species combined; all other species sawlog grade; and all other species off grade. Also,
for each year, I summed the sawlog grades and off grades of the non-pine species each year
to determine percentages. Finally, to account for the cruise based scale that occurred in 2010
and 2011, I tallied volumes and associated values by sawlog grade (grade 1 and grade 2), off
grade (grade 4 and grade 6) (MFR, 2010c), and cruise based grade (grade 7 and grade 8)
(MFR, 2010a). I did these calculations for both 2010 and 2011 for all non-pine volume and
then excluded the deciduous species and grades.
4.4.4. Semi-Structured Interviews
To provide further context and depth to my research, I conducted semi-structured
interviews. I chose a semi-structured interview technique because it did not limit me to
asking questions that reflected my research questions. Rather, it gave me the flexibility to
explore other questions that arose from my background research, or to respond to information
revealed by the participants (Dunn, 2010). I developed an interview guide (see Appendix III)
to use during the interviews. This guide contained: the interview questions in sequential
order; the context for the questions in the form of a preamble; and prompts, which served as
reminders for me while I was conducting the interview (King & Horrocks, 2010). In
developing my interview guide I consulted the seasoned researchers, who are part of my
advisory committee, for input on the design of my questions and on the construction of the
interview process. This consultation was very helpful, especially because I received sound
advice for opening and closing the interview. As well, prior to finalizing my interview guide

58

I conducted two mock interviews with people who understand forestry in British Columbia to
test both the clarity of my wording of the questions and to time the length of the interview.
I chose purposive sampling for this research because I wanted to gain specific
information that is relevant to this case (Yin, 2016). I used two purposeful sampling
strategies to identify potential participants: criterion and snowball sampling techniques
(Bradshaw & Stratford, 2010). I chose this sampling strategy because I wanted to get
informed opinions from people who are involved in the forest industry and who could bring a
specific understanding of the issues surrounding forest policy. The criteria I used to qualify
participants were the following:
 they had to have worked in forestry from at least between 1997 to 2011;
 they had to have lived within the case study area for at least ten years and at
least partially during the period of 1997 to 2011;
 and, they had to be associated predominantly with industry, with government, or
at arm’s length from one or both of these groups.
Initially I identified potential participants using my own knowledge (Berg, 1998). From there
expanded the sample by using the snowball sampling technique, in which I asked
interviewees who they thought I should interview (Babbie, 2007). I used the same criteria,
noted above, to select these potential participants with the added qualifier that they had to
have been suggested by at least two interviewees, unless the potential participant had a
unique perspective not yet sampled.
One of the advantages of using the criterion sampling technique is that it allows the
researcher to investigate a topic by identifying potential recruits who have specific
knowledge regarding the research topic (Van den Hoonaard, 2012). Potential recruits are then
identified using set criteria (Van den Hoonaard, 2012). I used the snowball sampling

59

technique as a way of limiting my own bias while getting the most variation in the sample
(Yin, 2016). Another consideration for using this technique is highlighted Van den Hoonaard
(2012), who says that it may serve as a means of accessing populations that are difficult to
reach and/or identify. Berg (1998) agrees saying that by asking participants to refer other
people that they may know who would fit the criteria and who may be interested in
participating is a way to expand the target population. A strength of the snowball sampling
technique is that it leverages the social networks of participants, but, it is also viewed by
many as a weakness, in that the technique has a, “perceived potential for bias” (Stehlik, 2004,
p. 39). The potential for bias is based on the perception that the researcher is limiting the pool
from which the sample is taken by relying on informant referrals, which will not necessarily
be representative (Atkinson & Flint, 2001).
For all of the aforementioned reasons, the purposive sample is not meant to be a
representative sample (Yin, 2016). As I was not interested in representing a population, I was
not concerned about my sample size as it relates to statistical analysis (Atkinson & Flint,
2001). But, I was interested in making sure that my sample was representative. I recognised
that there was potential for bias in using the snowball sampling technique, both in the
referrals received from informants, and as the researcher initiating the chain reference
because I identified the initial informants. I was concerned that by relying on referrals that
were provided by my informants I may be overly representing the opinions of those
particular social networks (Atkinson & Flint, 2001). I was also worried that I might be barred
access to certain social networks (Atkinson & Flint, 2001). Atkinson and Flint (2001) state
that snowball sampling is in fact: “biased towards the inclusion of individuals with interrelationships, and therefore will over-emphasise cohesiveness in social networks and will

60

miss ‘isolates’ who are not connected to any network that the researcher has tapped into” (p.
96).
I employed a number of strategies to minimize bias and to enhance the reliability of
the interview data. First, to ensure that I was not selecting participants from one specific
group, I decided to select people from different employment/career groups. Second, within
each employment/career group, I selected people from a range of positions within the
hierarchy of each group. For the actual selection of the initial participants I used my own
knowledge of having worked and lived in the Prince George Timber Supply Area since 2006
to identify potential participants and also drew from the knowledge I had gained from
studying background information about the case (Bradshaw & Stratford, 2010). For the
snowball sampling, I applied the same qualifying criteria for referrals that I did to the original
participants with the addition of the criterion that the person must receive at least two
referrals or must bring a unique perspective, not yet sampled. I also used the snowball
sampling as a method for cross checking my initial participant choices.
I began the interview process in late October of 2014 by soliciting potential
participants using a formal invitation via email, or by letter. Once potential participants
contacted me by email expressing their interest in participating, I sent the information and
consent form (see Appendix IV) for them to review and approve. Once they reviewed the
information and consent form, arrangements were made to conduct the interview.
Participants were also given the option to have the interview questions in advance of the
interview. The interviews were conducted in November and December of 2014. I used a
digital recording device to record each interview but also used the interview guide that I had

61

constructed to navigate the questions and to write notes during and after the interview (Dunn,
2010).
Once an interview was complete, I downloaded the digital file from the recording
device on to my computer and then erased the file from the recording device to ensure
security. Given that I am learning to do research, I chose to do a full transcription of each
interview myself for two reasons. First, doing a full transcription meant having a text version
of the interview. Second, doing the work myself gave me the opportunity to re-visit the
interview and become more familiar with the data (King & Horrocks, 2010). I used the
transcription module from the Olympus Dictation Management System software package
with the AS-2400 transcription kit which included the RS27 footswitch. I used this software
and hardware package because it enabled me to control the speed of the digital track but also
control the pause and play using the footswitch, making the task of transcription more
efficient.
Member checking is an important part of the interview process and enforces the
rigour of the research (Baxter & Eyles, 1997). Upon completion of each interview transcript I
then made a copy for editing in which I removed all of the ‘ums’, ‘ahs’, various slang, and
otherwise distracting elements used in spoken language from the transcribed text. I then
emailed this transcript to the participant in Word document format encouraging participants
to read through the document and to make any changes that they wanted to what they said.
The process from interview to return of the transcript to the participant for checking and
input took between two and four weeks. I asked participants to email me back their approval
or disapproval of the transcript and to also include a copy of the changed transcript should
they have made any changes. Once a participant approved of the transcript, with or without

62

changes, that version of the transcript became the official record. Allowing participants to
edit what they said not only ensures that you have captured what they said, but allows them
to articulate what they meant to say or reconsider what they said. Asking participants to give
their approval or disapproval of the transcript gave them every opportunity to withdraw their
participation if they so wished.
I used two approaches to analyzing the interview data: template and content
analyses. I used template analysis for the specific research questions and the more
conventional approach of content analysis to identify themes that occurred outside of the
interview questions (King & Horrocks, 2010). Prior to conducting the analyses, I assigned a
unique alpha-numeric identifier (P1-P15) to each interviewee and corresponding transcript to
preserve the anonymity of each individual during the analyses. These alpha-numeric
identifiers were also cross-referenced with the group number. Keeping the identity of the
participants anonymous for the analyses served to: guard against my own interpretation or
embellishment of the data based on my recollection of the interviews; and from being
inadvertently influenced by knowing which transcript belonged to which participant (Van
den Hoonaard, 2012). This strategy also served to reinforce the rigour of my research
(Bradshaw & Stratford, 2010).
Template analysis lends itself to a flexible coding structure where the researcher can
predetermine the themes in advance of the investigation by constructing a hierarchical theme
template (King & Horrocks, 2010). The majority of the interview questions that I asked were
very specific because I was seeking clarification and greater meaning to themes I had already
identified in the review of other data. I was also using this data as a means to check the
validity of my initial conclusions from the other data (Greene et al., 1989). One of the

63

strengths in using template analysis is that it allows the researcher to look for trends among
various participant perspectives (King & Horrocks, 2010). Therefore, because these
particular interview questions were already established themes and the questions were asked
across three different groups of people (King & Horrocks, 2010), I decided to use template
analysis for the specific interview questions.
For the specific interview questions I constructed a template using an Excel
spreadsheet that I set up ahead of time with the alpha-numeric identifiers and corresponding
group numbers for each question/theme (for question/themes used in this examination, see
Appendix V). Before I began putting information into the template I re-read each transcript
and the answers to the questions in a separate Word document. I then summarized each
participant’s answers further and entered the data into the spreadsheet template. After
entering all of the participant’s answers I was able to examine all of the answers given to
each question and look for trends within the whole and among the groups.
Not every question that I asked was part of a theme that was analyzed using
template analysis. These questions and other dialog were analyzed separately using content
analysis. To identify themes within the remainder of the discussion that flowed out of the
interviews I began with open coding and progressed to focused coding and finally to the
formation of themes (Van den Hoonaard, 2012). I began by re-reading each transcript several
times. Using open coding I took notes of words that seemed to occur often (Van den
Hoonaard, 2012). I then sorted the interview transcripts by group and compiled all of the
interview transcripts into one Word document per group, removing the text that belonged to
me.

64

Creating these three master Word documents allowed me to maintain individual
anonymity for the study, but retain the group identity. Using the word search navigation
function of Microsoft Word, I was able to find and tally specific words. I conducted both
manifest and latent content analyses (Dunn, 2010) using the words I had recorded earlier
when reading through the transcripts as well as synonymous or associated words. Thus, I was
able to tally the number of times a word was used by group and in what context. I used an
Excel spreadsheet to track and tally the words searched by group. The next step was to use
focused coding to sort the words into subthemes (Van de Hoonaard, 2012). Once the search
words were sorted into subthemes I classified the words as subtheme identifiers (see
Appendix VI).
Next, I needed a method of separating sub-themes that did not have a specific
context as well as the data that were already analyzed in the template analysis. So after
forming subthemes I assigned each subtheme the value of either ‘general’ or ‘specific’, as it
related to the context of the subtheme. Subthemes assigned ‘general’ were those that had a
very general context whereas subthemes assigned the value ‘specific’ had specific context. In
addition, all the subthemes were identified as to whether or not they were covered by the first
analysis. These subthemes were assigned the value ‘direct’. Those subthemes not covered by
the first analysis were assigned the value ‘indirect’. Subthemes that were both ‘specific’ and
‘indirect’ were then sorted into themes, which were topical and contained more than one
subtheme. Those subthemes that did not form a theme can be seen in Appendix VI.
The subthemes that had been identified as both ‘specific’ and ‘indirect’ were placed
into an Excel spreadsheet where the subtheme identifiers could be tallied by subtheme and by
theme. To identify which themes were important to the interviewees, I used the absolute sum

65

of subtheme identifiers to rank the themes (see Appendix VI for details). After re-reading the
transcripts, I inferred that an absolute sum of 100 or greater meant that the theme was
important to the interviewees (Gray & Densten, 1998). In other words, the transcripts
affirmed that the themes scoring higher than 100 were important because they were easily
found within the documents, whereas themes with scores less than 100 were more obscure
and difficult to find within the documents. Using this technique was a way for me to limit the
power I have as the researcher, deciding what to present and what not to present (Dunn,
2010).
I revisited the participant transcripts to ensure that what came out of both analyses
were in fact what the interviewees were communicating. The accuracy checking procedure
involved re-reading each interview transcript several times from start to finish and
subsequently checking specific transcripts for specific details. The procedure not only served
to check the accuracy of both analyses, but also to check my own subjectivity. The themes
that were deemed important are presented in the next chapter. For all the themes identified I
also made tables that included the subthemes with the relative frequency of subtheme
indicators by group. I made these theme tables to demonstrate how often a group talked about
the subtheme relative to the other groups, and to identify if there was any solidarity within
the groups themselves (see Appendix VI for details).

66

Chapter 5: Results and Analyses
5.1. Introduction
My research data were acquired through a variety of sources and the scrutiny of
these data were as complex as their acquisition. Therefore, for clarity, I have chosen to
present the findings in the same format and order that I did in the Data Collection section of
Chapter 4. I will begin with what I found out about mill closures from the media scans and
document analysis which will be followed by a summary of employment. Next, I will reveal
the results of my inquiries regarding the timber harvest and valuation information I obtained
from British Columbia’s Harvest Billing System (HBS). Finally, I will demonstrate what I
discovered in the breakdown of the semi-structured interviews that I conducted.
5.2. Mill Closures
The media scan of the Prince George Citizen newspaper revealed that during the
period between 1997 and 2011, within the Prince George Timber Supply Area, a total of
eight lumber manufacturing facilities were closed, one was opened, and two received
substantial upgrades. These mill closures were as follows: Northwood PG Wood, Canfor
Netherlands, Canfor Upper Fraser, Winton Global Lumber, Canfor Rustads, and Canfor
Clear Lake in Prince George District; Pope & Talbot Inc. and Stuart Lake Lumber Co. Ltd. in
Fort St. James District. There was also the loss of a plywood plant in the Prince George
District due to a fire. Six of the nine closures occurred between 2008 and 2011. During the
same time period there was one sawmill opening within the Fort St. James District, one
sawmill upgrade within the Vanderhoof District, and one sawmill upgrade within the Prince
George District.

67

As there appeared to be no direct correlation between the mill closures and the
changes to legislation in 2003, I needed to look for other explanations for the closures. To
compare and contrast the sawmill closures and openings within the Prince George Timber
Supply area to other events happening, I constructed an event timeline (see Appendix II). The
types of events that I included were those having to do with the mountain pine beetle
epidemic, lumber markets, forest policies, and legislation. Looking at all of the events within
the context of the forest industry and time period, the event timeline provided me with clues
as to why the mill closures occurred. On the surface, mill closures and openings seemed to
coincide with events occurring within the lumber markets. An ancillary investigation of the
internet for news regarding the mill closures identified above revealed that for some mills,
the official closing date was years after the fact (Canfor, 2011). So, for the purpose of this
inquiry, the closing date is the date when production ceased.
Using the mill closure criteria listed above, the additional investigation revealed that
the six closures within the Prince George Timber Supply Area occurred between 2007 and
2010. In 2007 Winton Global Lumber (Hoekstra, 2011), Stuart Lake Lumber Co. Ltd, and
Pope & Talbot Inc. (Hamilton, 2008) were closed. In 2008 Canfor Corporation (Canfor)
closed its Rustad mill (Hoekstra, 2010), and then its mill in Clear Lake in 2010 (Hoekstra,
2011). Meanwhile, the mills that remained open reduced their production capacity by
reducing the number of shifts at various times (Canfor, 2008; Hamilton, 2008). As for the
two defunct mills in Fort St. James, both were purchased by other companies in 2009. Pope
& Talbot Inc. was purchased by Conifex Timber Inc., who re-opened the mill in 2009 (Tice,
2009). However, Dunkley Lumber Ltd. chose not to re-open the mill when they purchased
Stuart Lake Lumber Co. Ltd. (Nielsen, 2011). Incidentally, Canfor did not rebuild its

68

plywood plant that was destroyed by a fire; rather, the insurance money was used to invest in
upgrades for other facilities (Canfor, 2008).
To understand some of the reasons why these mills were closed, it is useful to look
at what was occurring elsewhere in the province. In fact, the Prince George Timber Supply
Area was not the only location to experience sawmill shutdowns as there were massive
shutdowns occurring throughout the province at that time, both in the Coast and the Interior
forest regions (Hamilton, 2008). For example, Pope & Talbot Inc., a company based in the
United States with numerous lumber and pulp operations in British Columbia, filed for
bankruptcy protection in October of 2007 (VanderKlippe, 2007). For many forest companies
like Pope & Talbot Inc., the decline in profitability began in late 2006 when lumber prices
began to fall as a result of declining housing starts in the United States. Profitability was
further confounded in 2008 when the housing market crisis in the United States began to
unfold (Hoberg, 2010). Not only were lumber prices reaching historic lows, the value of the
Canadian dollar was high (Hoberg, 2010).
Furthermore, the United States was still British Columbia’s largest consumer of
lumber products (BC Stats, n.d.) so these downturns in the lumber market would have had a
significant negative impact on the lumber manufacturing sector. The housing crisis in the
United States was not the sole cause of the problems facing Pope & Talbot Inc.
(VanderKlippe, 2007) or other forest corporations (Hamilton, 2008). Most companies were
already stretched financially due to the lengthy legal battle with the United States over
softwood lumber and the ensuing high tariffs imposed by the US Department of Commerce
in the form of countervailing and anti-dumping duties (Zhang, 2007). From 1997 to 2001 the

69

export of Canadian lumber into the United States was controlled by quotas established by the
Softwood Lumber Agreement of 1996 (Zhang, 2007).
5.3. Employment
BC Stats reveals that there has been a steady decline in employment in the forest
industry since 1997, with an overall decline of 43% within the forest industry in British
Columbia. However, employment in the forestry and logging sector has had a much greater
decline (57%) than that of the wood manufacturing sector (33%) (see Table 1). What is
interesting is that if you look at the annual change there are three relatively large negative
declines in the forestry and logging sector, 2001 (10,700), 2004 (6,000), and 2008 (6,900). In
contrast, the wood manufacturing sector shows only one significant negative decline, it
occurred in 2008 with a loss of 10,100 jobs. Cumulative losses from 1997 to 2011 are
18,900 jobs in the forestry and logging sector and 14,700 jobs in the wood manufacturing
sector.
Table 1: British Columbia Employment by Detailed Industry, Annual Averages.
NAICS*

Sector

Forestry ŧ 1000s

Product

§

97

98

99

00

01

02

03

04

05

06

07

08

09

10

11

32.9 30.2 29.9 35.5 24.8 25.2 27.1 21.1 21.3 21.4 24.2 17.3 13.9 16.1 14.0

Resource

60% 59% 62% 68% 61% 67% 61% 61% 58% 50% 52% 39% 35% 40% 35%

Goods

8%

7%

8%

9%

7%

7%

7%

5%

5%

5%

5%

4%

3%

4%

3%

All

2%

2%

2%

2%

1%

1%

1%

1%

1%

1%

1%

-

-

-

-

1000s

44.8 43.1 42.1 45.9 48.7 43.5 48.4 45.7 45.1 43.8 43.7 33.6 26.8 28.7 30.1

Manufacture 23% 22% 22% 23% 25% 22% 24% 22% 23% 23% 22% 18% 17% 17% 18%
Goods

11% 11% 11% 11% 13% 11% 12% 11% 10% 10% 9%

7%

6%

7%

7%

All

2%

2%

1%

1%

1%

2%

2%

2%

2%

2%

2%

2%

2%

2%

2%

Source: Statistics Canada, Labour Force Survey (unpublished data). Prepared by BC Stats,
February 2012.*NAICS – North American Industry Classification System;

ŧ Forestry and Logging with support activities; § Wood Product Manufacturing.
Percentages reflect the relative representation to the specific sector, the Goods-Producing Sector, and All
Industries.

70

The significant loss of 10,100 jobs in the wood manufacturing sector in 2008 can
definitely be linked to the large number of mill closures throughout the province that year
(Hamilton, 2008). However, the significant losses experienced in the forestry sector in 2001,
2004, and 2008 require a more protracted explanation. As jobs in the forestry sector are
linked to the timber side of the business rather than the manufacturing side, one needs to look
at those factors which may have influenced the harvesting activities of firms.
In 2001, the forestry sector experienced a loss of 10,700 jobs. The forest industry
had been under the costly regulatory regime of the Forest Practices Code of British
Columbia Act1995 since 1994 (Hayter, 2000; Pearse, 2001), and expiration of the Softwood
Lumber Agreement in 2001 created unsavory business conditions (Zhang, 2007). However, it
was likely a combination of the high countervailing duties placed on lumber and the high
price of stumpage that had the greatest impact on forest sector jobs (Hamilton, 2001; Jackson
& Curry, 2002). Given that the forest industry in the Coast forest region of the province was
having much more financial difficulty, due in part that logging costs there superseded those
elsewhere in the province (Grafton et al., 1998; Pearse, 2001), it is reasonable to assume that
that most of these job losses likely occurred there.
In 2004, the loss of 6,000 jobs in the forestry sector can likely be partially attributed
to changes in technology (MOF, 2001b). Changes in logging and trucking technology
allowed companies to reach higher levels of efficiency (Stirling, 2004), which meant greater
production and fewer jobs. As for the 6,900 job losses in 2008, these can be linked to the
slowdown in the economy triggered by the housing crisis in the United States (Hoberg, 2010).
As a means of preservation, forest companies drastically curtailed the production of lumber
and their harvesting operations (Canfor, 2008; Hamilton, 2008).

71

More specifically to the Prince George Timber Supply Area, an analysis conducted
by Horne (2009) compared forest industry employment in 2006 between the Prince George,
Vanderhoof, and Fort St. James Districts (see Table 2).
Table 2: 2006 Direct Employments in Logging and Other Wood Manufacturing Sectors.
District

Logging

Prince George
2443
Vanderhoof
752
Fort St. James
290
Source: Horne (2009).

Percent of
Total Direct
Employment

Other Wood
Manufacturing

8%
18%
19%

2931
992
418

Percent of Employment
Total Direct Estimate in
Employment
Forestry
Sector
10%
26%
24%
45%
28%
49%

Note that in terms of relative importance, the employment in the Vanderhoof and Fort St.
James Districts is nearly double that of the Prince George District. Horne (2009) also
produced a special report for the ministry responsible for forests in 2009 where he
reconfigured the alignment of data collected by BC Stats and Statistics Canada in 2006 from
Regional District to Forest District boundaries. This data reveal the economic dependency of
each Forest District in the province, where it is described using indicators such as regional
diversity, dominant basic income sources, dependence on forestry and wood processing,
forest sector vulnerability, dependence on underground resources, and dependence on
tourism. From this information it is clear that the Vanderhoof and Fort St. James Districts are
extremely dependent upon forestry, (see Table 3 for details).

72

Table 3: 2006 Economic Dependencies by Indicator and Forest District
Economic
Prince George
Dependency
Forest District
Indicator
Regional Diversity
2
Dominant Basic
Public Sector
Income Source
Dependence on
21-26%
Forestry & Wood
Processing
Forest Sector
4
Vulnerability
Source: Horne (2009).

Vanderhoof
Forest District

Fort St. James Forest
District

1 = Least Diversified
Forestry &Wood
Processing
27-70%

1 = Least Diversified
Forestry & Wood
Processing
27-70%

5 = Most Vulnerable

5 = Most Vulnerable

In addition to the analyses done by Horne (2009), approximate job losses associated
with the closing of mills between 2007 and 2010 in the Prince George Timber Supply Area
were obtained from the ancillary media scan (see Table 4). For the three year period, there
were an estimated 767 direct jobs lost in the wood manufacturing sector in the Prince George
Timber Supply Area. The purchase of Pope & Talbot Inc. sawmill by Conifex Timber Inc. in
2009, which was reported to employ approximately 230 people (Tice, 2009), are included in
the final total estimate of 767 direct jobs.
Table 4: Approximate Direct Employments Loss Due to Mill Closures in the PGTSA.
Mill Closure
Closure Year
Affected Employees
District
Winton Global
2007
~ 220
Prince George
Stuart Lake Lumber
2007
~ 100
Fort St. James
Pope & Talbot Inc.
2007
~ 272
Fort St. James
Canfor – Rustad
2008
~ 220
Prince George
Canfor – Clear Lake
2010
~ 185
Prince George
Source: Data for Canfor - Clear Lake (Hoekstra, 2010), all other data (Hamilton, 2008)
Specific employment figures for the Prince George Timber Supply Area are not
available to the extent that the provincial figures are. However, the similarities between the
timing of mill closures locally and provincially indicate that the Prince George Timber

73

Supply Area likely experienced similar job losses in the forestry and wood manufacturing
sectors. Also important to note is that the estimated 767 job loss in the wood manufacturing
sector cannot be added to the work done by Horne (2009), as his analysis was done using
official census data and by splitting jurisdictions.
5.4. Timber Harvest and Valuation
For the inquiry using the Harvest Billing System (HBS) data, an assumption was
made that logs are processed where they are scaled. Although trading does occur between
timber processing facilities, it is assumed that the majority of logs are transported directly to
where they will be processed because handling and transporting logs is expensive. Thus, it is
assumed that for economic reasons, logs are sorted at the point of harvest so that they are
delivered directly to where they will be processed. One particular limitation of using scale
data from the Harvest Billing System is that the majority of the logs in the British Columbia
interior are weigh scaled (FLNRO, 2011b). As defined by the Scaling Manual (FLNRO,
2011b), weigh scaling is a statistically valid method of scaling where only a sample of the
population is measured. So ultimately, the method of weigh scaling results in a certain
amount of averaging of the scale data.
Hence, when a truckload of logs arrives at a mill site the truck is weighed and the
logs it is carrying are placed into a stratum by the weigh scale operator. A stratum is a
defined species mix ratio that is predetermined on an annual basis and are unique to the scale
site (FLNRO, 2011b). Each stratum has its own sampling frequency, which determines how
often loads are sampled (FLNRO, 2011b). So, after the truck load of logs is placed into a
stratum and weighed, the logs are then unloaded and the truck is weighed again on the scale
empty to calculate the net weight of the logs. The conversion factor for that stratum is then

74


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From 1997 to 2011 the majority of the timber that was harvested in the Prince
George Timber Supply Area (PGTSA) by forest licence holders was also scaled in the
PGTSA. In fact, throughout the entire time span, with the exception of 2003, 2004, 2005 and
2006, at least 97% of the timber harvested within the PGTSA was scaled there as well (see
Figure 5). The most notable scaling gap occurs: in the Fort St. James District between 2006
and 2011 (see Figure 2); and in the Vanderhoof District from 2003 to 2006 (see Figure 3).
Though the majority of the missing scale volume from Fort St. James and Vanderhoof
Districts can be accounted for as being scaled in the Prince George District, and, therefore,
within the PGTSA, it does not account for the entire scaling gap.
A closer examination of the scale data shows that the majority of the harvest and
scale gap outside the Prince George Timber Supply Area (PGTSA) can be accounted for. In
the Fort St. James District the majority of timber was scaled in Nadina District for 2004,
2005, and 2006. In the Vanderhoof District, timber was being scaled in Skeena Stikine
District for 2003, 2004, 2005, and 2006, and less significantly in Nadina District for 2003,
2004, and 2005. In the Prince George District, timber was scaled in the following Districts: in
the Quesnel District in 2003, 2004, and 2005; in Mackenzie District for 2004 and 2005; and,
in the Peace District for 2003 and 2004. What is less clear is the explanation for the scale
gaps of 2003 to 2006 outside of the PGTSA.
There are several factors that could help to explain why timber was scaled elsewhere
during that time period. First, in 2002 and 2004 the allowable annual cut (AAC) for the
Prince George Timber Supply Area (PGTSA) was increased to accommodate the salvage of
lodgepole pine being killed by the mountain pine beetle (Pedersen, 2004). Second, according
to annual reports compiled by the Economics and Trade Branch of the ministry responsible

78

for forests regarding the major primary timber processing facilities in British Columbia, there
were two companies, Canfor and West Fraser, which had timber processing facilities in other
Districts besides those within the PGTSA (MOF, 2004a; MFR, 2005; MFR, 2006a; MFR,
2008b). A final factor could have been that companies were investing in capital upgrades for
their mills (Canfor, 2003). The allowable annual cut (AAC) had been increased in the Prince
George Timber Supply Area (PGTSA) due to the mountain pine beetle, but the industry at
the time may have not had the capacity to mill all of the timber that could be cut. Further, in
terms of timber profile, the majority of the timber being harvested was lodgepole pine.
Therefore, it is not difficult to suppose that companies were shipping the timber where they
needed it most, or where it made economic sense to do so.
So, looking at the scale gaps again, assumptions can be made between the timber
harvested, where it was scaled, and the major licensees operating within the Prince George
Timber Supply Area. Timber that was harvested from the Fort St. James and Vanderhoof
Districts and scaled in Nadina District could have been timber cut under licence by Canfor
and/or West Fraser, as both companies had mills located in the Nadina District. These mills
in the Nadina District were located in Houston (Canfor) and Burns Lake (West Fraser). In the
case of timber harvested in Vanderhoof District being scaled in Skeena Stikine District, the
timber may have been shipped by West Fraser, as they had a mill located in Smithers. The
West Fraser mill in Smithers could have been experiencing a shortfall in timber supply since
the collapse of Skeena Cellulose, but also because of increased competition for fibre from
larger producers, like the Canfor mill located in Houston. Timber that was harvested in the
Prince George District and scaled in the Quesnel, Mackenzie and Peace Districts could have
been harvested by Canfor, as they not only had several mills in the Prince George District,

79

but mills located in Quesnel (Quesnel District), Mackenzie (Mackenzie District), and in
Chetwynd and Fort St. John (Peace District).
When looking at the total revenue generated for the Crown from the timber
harvested by forest licences, it is important to note that revenue has declined significantly
over time, showing a negative correlation beginning in 2000. The decrease becomes
particularly steep between 2006 and 2007. The sharp decline continues to 2010 when it
becomes clear that there is no apparent correlation to the amount of revenue collected and the
volume harvested (see Figure 6 for details).

$360,000,000
$340,000,000
$320,000,000
$300,000,000
$280,000,000
$260,000,000
$240,000,000
$220,000,000
$200,000,000
$180,000,000
$160,000,000
$140,000,000
$120,000,000
$100,000,000
$80,000,000
$60,000,000
$40,000,000
$20,000,000
$0

12,000,000
10,000,000
8,000,000
6,000,000
4,000,000

Total volume in cubic metres

Total revnue collected
(Canadian dollars corrected for inflation to 2011 values)

Total Volume Harvested by Forest Licences in the
Prince George Timber Supply Area
Versus the Revenue Collected

2,000,000
0
Year
Total Revenue

Total Volume

Figure 6. Forest licence harvest within the Prince George TSA versus revenue collected.

80


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The resulting data show a steady deterioration of log grade over time with the
exception of 2007, were the quantity of off grade logs decreased. Though the move towards
salvaging lodgepole pine was gradual, the degradation of this timber from the time of death
was progressive (Lewis & Hartley, 2006). As such, the degradation would have affected the
overall grade of the timber being harvested, and subsequently the stumpage rates applied, as
the years from death increased. The decrease in off grade timber volume in 2007 can be
explained by the log grade changes made to the Interior log grades in 2006 which changed
the definition and categories of sawlogs (FLNRO, 2011b).
While the changes made to the Interior log grades seemed to temporarily delay the
off grade status of dead lodgepole pine being harvested in 2007, it did not seem to make
much of a difference in terms of the overall stumpage revenue collected. Initially, I thought
that the increased proportion of lodgepole pine being harvested, in combination with the
decline in the associated log grade, would explain the decline in stumpage revenue. I
expected that the increase in off grade would produce a decline in stumpage revenue because
there is a significant difference in dollar value between the stumpage rate of sawlog grade
and off grade. Currently in British Columbia, the minimum stumpage rate in the Interior is
$0.25/m3 (Forest Act, Minimum Stumpage Regulation). The minimum stumpage rate is
applied to conifer off grades, which is currently defined as grade 4 and grade 6 in the Interior
Appraisal Manual (FLNRO, 2015b).
Clearly the Interior log grade changes alone do not explain the dramatic decline in
stumpage revenue over the entire timber profile. It is more likely that the decline in stumpage
revenue had more to do with how timber was appraised than how it was graded. There were
two changes to how timber was appraised. The first occurred on July 1, 2006 when the

85

market pricing system replaced comparative value pricing as the method used to calculate
stumpage in the Interior (MFR, 2006b). The second occurred on July 1, 2010 when the cruise
based, stand as a whole, pricing mechanism was introduced (MFR, 2010b; MFR, 2010c).
Basically, the market pricing system takes prices determined through competitive auctions,
which are administered by BC Timber Sales, and these prices then feed into a complex
calculation that determines stumpage rates (MOF, 2004b). However, the stand as a whole
calculation of stumpage was introduced by government as a means of encouraging more
utilization of low value timber. At the same time, the ministry responsible for forests made
adjustments to the market pricing system to make it more responsive to market signals (MFR,
2010d).
It was not until I looked at the stumpage and log grade details of the non-pine
component of the harvests that I realized stumpage rates overall were declining. A
comparative analysis was done to calculate the average stumpage paid by forest licence
holders annually from 2000 to 2011 for lodgepole pine versus all other species (see Figure
12). When looking at stumpage collected for the timber harvested in the Prince George
Timber Supply Area between 2000 and 2011, the average stumpage paid by forest licence
holders for lodgepole pine decreased from $31.82/m3 in 2000 to $1.15/ m3 in 2011, with the
lowest average stumpage paid being $0.89/m3 in 2010. For all other species, the average
stumpage collected also declined over the time period, from $33.31/m3 in 2000 to $2.58/ m3
in 2011. It is interesting to note that there appears to be a positive correlation between the
average stumpage price for lodgepole pine and all other species from 2007 to 2011 (see
Figure 12).

86

Average Stumpage for Lodgepole Pine Versus All Other Species
$35.00

Average Stumpage ($/m3)

$30.00
$25.00
$20.00
Lodgepole Pine

$15.00

All Other Species
$10.00
$5.00
$0.00
Year

Figure 12: Annual average stumpage paid for lodgepole pine versus all other species.
When the stumpage collected between lodgepole pine and all other species was
examined, there was a significant decline in the stumpage rates for non-pine species starting
in 2007 (see Figure 12). An important point to emphasize is that the component of off grade
for non-pine species averaged 20% between 2007 and 2009 but averaged 41% in 2010 and
65% in 2011 (see Figure 13). A final inspection of the non-pine harvest showed that from
2000 to 2009 there was a fairly consistent proportion of off grade to sawlog grade, averaging
18%. However, there were significant increases in the off grade for 2010 and 2011 (see
Figure 13). A closer examination of data in 2010 and 2011 revealed the significance of the
cruised based scale. For the coniferous non-pine harvest, 27% of that harvest was billed as
cruise based in 2010 and 57% in 2011 (see Figure 14). Note that in Figure 14, the off grade
and sawlog together represent the conventional weigh scale for non-pine coniferous species.

87


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Further inspection of the data revealed that the increase in the off grade component
was due to the cruise based component in the billing record. Moreover, the average stumpage
rate for the sawlog component of the non-pine coniferous species that was weigh scaled was
four times the average stumpage rate for the non-pine coniferous species billed as cruise
based. In fact, when the volume billed as cruise based is assigned an 80% sawlog recovery
rate, and the average sawlog stumpage rates are used to calculate the revenue, the calculation
produces an additional 1.8 million dollars in 2010 and 5.2 million dollars in 2011. Finally, it
is important to note that in scrutinizing the cruise based scale data the relative proportions of
lodgepole pine to other coniferous species was also examined. It was found that the
coniferous non-pine volume contribution did not exceed 30% in either 2010 or 2011, but that
the average billed volume in both years consisted of 70% lodgepole pine and 30% other
species.
5.5. Semi-Structured Interviews
The participants involved in my research all had informed opinions regarding issues
surrounding forest policy and the Prince George Timber Supply Area because they have
worked in forestry and lived in the research area. A total of 18 people were solicited, 11 were
identified by me and 7 were identified by others. The snowball sampling also confirmed 6 of
the 11 potential participants that I identified. In the end, I interviewed 15 people from three
employment/career groups: those who work primarily for industry; those who work primarily
for government; and those who work at arm’s length to one or both of the other groups. The
average number of years working in forestry was 33 years and the average number of years
living in the area was 24 years (see Table 4 for details).

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Table 5: Interview Participant Statistics.
Participant Statistic

Group 1
Industry

Group 2
Government

Group 3
Other

Number Solicited
Number Interviewed
Years Working in Forestry (Average)
Years Working in Forestry (Range)
Years Living in the TSA (Average)
Years Living in the TSA (Range)

8
5
33
25-40
28
24-36

6
6
35
30-37
20
13-34

4
4
31
27-34
26
21-33

Total
All
Groups
18
15
33
25-40
24
13-36

My intent is to remove as much of myself as possible in the presentation of the
interview findings and I have written this section to incorporate as many of the participants’
voices as possible. Although I am earnest in my endeavor to present the voices of the
participants and extract myself, I cannot fully achieve my goal within the constraints of a
Master’s thesis because I have had to make choices as to which quotes to include and which
to exclude from the body of my work. As such, I will be summarizing what participants have
said as well as using direct quotes to emphasize particular points.
The themes that I identified from the interview process were both developed
beforehand in the form of the interview questions themselves, and derived from the interview
transcripts. Moreover, though the participant groups were formed as a means of ensuring
variability in the sample (Yin, 2016), there were no significant trends found within any
particular group. The lack of significant trends within the groups is an interesting finding
because it seems to indicate that interviewees were communicating their own perspectives.
This is not to say that the perspectives expressed were not those of the employment/career
group, rather, that there was significant variability within each employment/career group. As
such, specific reference to the employment/career groups in the presentation of the research

90

findings is limited to the construction of the last four themes. These first seven themes were
derived from the findings from the other sources and then were woven into specific interview
questions so as to obtain specific opinions.
Theme 1: The Legislative Changes to Forest Policy in 2003
In 2003 a suite of legislative changes were made to forest policy under various bills.
These legislative changes were connected to the Liberal election platform in 2001 and
specifically to their plan to revitalize the forest industry. This theme involves the specific
changes brought about by Bill 29 which allowed the holders of forest licences to consolidate
and subdivide forest licences, and transfer agreements. It also allowed companies to
determine the number and location of their timber processing facilities. My development of
interview questions around this theme flowed from my desire to understand why the changes
were made, and ultimately to find out if the changes were successful in strengthening the
forest industry. Therefore, I was interested in what participants had to say about events that
may have precipitated the changes, what they thought were the factors were that influenced
this change, and, what pressures they thought may or may not have been on the government
of the day.
When I listed off the particular changes brought about by Bill 29, the majority of
participants thought that the changes were good because it freed the industry to operate like a
business (P2, P6, P7, P8, P11, P14 & P15). As participant P15 expressed: “I think those were
good changes because they allowed business decisions to drive industry directions, and let
market forces play a bigger role rather than social engineering” (p. 3). Many also felt that the
industry had been unduly over regulated for too long (P4, P7, P8, P9, P11 & P14). As

91

participant P4 said: “[s]ometimes if we do try to constrain market forces too much, then we
sometimes get undesired outcomes” (p. 3). However, there were also participants who were
concerned about how the industry would respond to the changes (P1, P10, P12 & P13).
Participant P10 stated: “[…] I was very worried about a number of them, the ability to
consolidate was one big one that bothered me, and the appurtenancy issue was another […]”
(p. 2).
All of the interviewees thought that the reason legislation was changed by Bill 29
was because the forest industry was not doing well at the time. A key reason for the
condition of the industry was that the lumber manufacturers were struggling to compete in
the global market. According to participant P6: “[a]t one time the forest industry in British
Columbia pretty much had a lock on things, but it got very competitive very quickly” (p. 4).
But global competition was not the only contributing factor in the minds of participants.
Some believed the ongoing softwood lumber dispute with the United States of America also
played a large role (P4, P7, P8 & P10). According to participant P7:
[…] getting a new Softwood Lumber Agreement that was part of it. I think without
question, some of it was driven by political ideology. […] There was also, I think,
recognition that the forest industry wasn’t all that healthy and that there was some
structural problems there that needed to be addressed (p. 3).
With all the pressures for change, many participants felt that the changes made to
legislation were inevitable (P2, P3, P4, P6, P7 & P15). Participant P7 said of the changes:
“[…] some things would have changed anyway. But I think the amount of change and the
pace of change was significantly greater because we did have a change in government” (p. 4).
However, most also stated that the Liberal government did have a choice in what those
changes looked like (P1, P2, P6, P7, P9, P12, P13, P14 & P15). As described by participant

92

P6: “[…] I don’t think that they were forced to do it, it was something that they ideologically
believed was the right thing to do” (p. 5). Still, other participants believed that what the
changes targeted and how they were implemented was the product of the Liberal
government’s political ideology (P1, P6 & P11). While explaining how the Liberal
government was aligned with business, participant P1 revealed: “[…] at the time they came
into power, their overall economic philosophy took some heavy cues from Alberta” (p. 5),
and participant P11 surmised: “[t]he easiest way to say it is if we would have had a different
government in there, I don’t think we would have had the same result” (p. 5).
Upon concluding the discussion regarding the changes to legislation brought about
by Bill 29, several participants commented that in hindsight the timing of the changes was
serendipitous, allowing the industry to reconfigure itself to deal with the mountain pine
beetle epidemic (P7, P8, P11& P14). This was expressed by participant P11:
Probably the timing in this one was probably really good, it would be interesting to
see what would have happened if we didn’t have mountain pine beetle issues to deal
with. How it all would have played out, because there was a sense of urgency to
capture value with timber […]. And you know, I think it helped us get there faster,
as far as having less mills and more optimum ways to run (p. 3).
Even the participants who were initially concerned about the legislative changes
acknowledged that they understood the need for change (P1, P10, P12 & P13). Which was
described by participant P12 who said: “I’ve come to see at least that industry needs to be as
competitive as it can be and it has allowed them to be more competitive. But it was not good
for a lot of communities” (p. 2). The sentiment was also echoed by participant P10: “I
understand that you shouldn’t force things to stay open that aren’t economic, except that
there is that social component to it” (p. 5).

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Theme 2: The Evolution of the Forest Industry
When developing this theme I was thinking about how the forest industry might
have changed over time and wondered if these changes were connected to the changes made
by Bill 29. I also wanted to know that if the changes in the forest industry were connected to
the changes in legislation and, if so, how. I asked participants about changes that they saw in
the forest industry and if they thought they were influenced by the changes made by Bill 29.
Further, I also asked them to give me specific examples of how they thought they were
connected. Finally, I asked participants how they felt about the changes and why.
All of the participants agreed that changes made to legislation in 2003 definitely
played a role in the evolution of the forest industry because it allowed business decisions to
be made which in turn facilitated the consolidation and rationalization of the industry. Most
of the participants felt that this change had been positive for the following reasons: it had
unlinked the timber supply to the processing facility (P4 & P9); it allowed the industry to
increase utilization and production (P2 & P12); and it resulted in an industry that is more
stable and competitive (P3, P6, P9, P10, P14 & P15). One participant felt that the industry
was more diverse because the constraint of where timber processing was located in relation
to the timber harvest was removed (P11). Other participants felt that by increasing utilization
and production, the industry was able to efficiently face the challenges created by the
mountain pine beetle (P7, P8 & P12). As participant P12 emphatically stated: “[w]ell, I
believe we have if not the most efficient, certainly one of the most efficient sawmilling
industries in the world” ( p. 5). Regarding the increased stability of the industry, participant
P1 commented on the lumber manufacturing sector’s resilience during the last recession:
“[…] there’s no doubt in my mind that the recession, the 2007 to 2009 recession, it would

94

have been way worse I think in the forest sector, had it not been for those policy changes in
2003” (p. 7). The stability was further explained by participant P7: “[…] if you’ve got fewer
mills that have a higher margin, they can operate through different parts of the market cycle
[…]” (p. 7). Conversely, a few participants had the opposite view as to the evolution of and
the state of the forest industry, in particular that it was far less diverse in the number of
players, especially in the value-added sector (P1 & P13), and that there were far less jobs in
the industry (P5). Regarding the strength of the forest industry post 2003, participant P13
said the following:
I don’t know that we are stronger, […] I think we’re more one or two people operate
on the land base scenario, is where we are at. And I think we would have been
stronger having a more broad, group of companies (p. 7).
Theme 3: The Centralization and Capitalization of Manufacturing
The third theme emerged from results that I found from the media scan of sawmill
closures, the employment statistics from BC Stats, as well as the harvesting and processing
information I analyzed from British Columbia’s Harvesting Billing System (HBS). What I
found was that there were many closures of sawmills within the case study, primarily in the
Prince George District, while over time manufacturing remained constant. As well, the
employment statistics revealed that over time, there were fewer people employed within the
forest industry. What I wanted to know from participants is if they thought the current
industry was stronger as a result and why. I also was interested in what participants thought
the implications were for forest dependent communities.

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All of the participants agreed that the consolidation and capitalization of the lumber
manufacturing sector was hard on communities, especially those whose economies were
more reliant on forestry. The following participants noted:
[…] our mills are incredibly efficient. They have smart people running them. The
ones that weren’t smart aren’t in business anymore. […] Unfortunately, it means
fewer jobs. They’re producing more lumber with fewer people, way fewer people
[…] (P12, p. 5).
[…] there’s always a human cry when a mill goes down, or there’s some
consolidation or a mill burns […]. People depend on those mills for jobs and
community stability and they don’t see what another option is for them (P6, p. 9).
Nevertheless, despite being hard on communities, the majority of participants felt that the
industry was stronger because investment in capital made the industry more efficient (P1, P2,
P3, P4, P12, P14 & P15), more flexible (P5, P7, P8, P9, P10, P14 & P15), and able to operate
within smaller economic margins (P1, P6 & P11). None of the participants were that
surprised by the consolidation of industry because, according to participant P15: “[…] the
investment in technology and infrastructure leads to concentration of the manufacturing into
fewer areas, fewer communities” (p. 5). Again, as noted by participant P9: “[t]hey can move
the wood to wherever they need it for their other mills. So it’s allowed probably more big
mills, more efficient mills, or more modern mills to evolve” ( p. 4). Participants also revealed
that Prince George has always been a hub of industrial activity (P2, P7, P12 & P14). As
participant P8 explained:
Prince George has always been the centre for consolidating and the accumulation of
all the bush mills, Sinclair, Penny, southeast, they all come to Prince George, so I’m
not sure that the concentration issue has changed that much over the decades (p. 6).

96

When speaking specifically about the impact on communities, participants
generalized beyond the geographic scope of the Prince George Timber Supply Area
commenting that there were definitely communities that benefited and those that did not.
Despite the fact that communities were negatively impacted, many participants still felt that
communities benefit from having an industry that is more stable (P2, P3, P6, P7, P8, P9, P12,
P14 & P15). As well, the forest industry may still be a part of the community economy even
though it does not have a timber processing facility. Participant P2 explained: “[s]o what
ends up happening in those smaller communities is we have a community of loggers but we
don’t have a community of millers” (p. 6). Conversely, though the Prince George Timber
Supply Area as a whole may not be among the most economically vulnerable to changes in
the forest industry, it still has communities that are. The outcome for these forest dependent
communities, according to participant P4 is that: “[…] stability and employment is no longer
a given. […] it means that the communities are more susceptible to industry reallocations of
timber supply and logging” (p. 5). There will be even bigger implications in the future
because as the timber supply declines and the industry is reconfigured (P1, P2, P4, P6, P7,
P8, P11, P12, P14 & P15), communities will need to learn to adapt:
It has kind of forced some unpleasant things on communities with regards to the
resource sector, but it, it’s a cyclical nature of the business. And I think that if you
are a town or your principal economy is based on forestry, the real answer should be
is if you understand the business and the cycle, then you have to recession proof
your economy for when things aren’t good (P11, p. 7).

Theme 4: Other Changes in the Industry
This theme of other changes in the industry arose from wanting to know from
participants what other changes they observed in the forest industry since the changes made
97

by Bill 29. The questions I developed for this theme allowed me to explore aspects of change
within the forest industry that I had not thought of, and that may or may not be connected
with Bill 29. Therefore, I asked an open-ended question because I wanted to know what
participants observed and considered important to mention, with regards to other changes
within the industry.
Not all of the participants commented, but those that did noted the following
changes: the move from the Forest Practices Code of British Columbia Act 1995 (Code) to
the Forest and Range Practices Act 2004 (FRPA) (P1, P3, P5, P8, P11 & P13); the rise in
the number of community forests (P4, P7, P8, P9, P10, P11 & P15); the increased
participation with and opportunities given to First Nations (P7, P8, P10, P14 & P15); the
creation of BC Timber Sales (P3 & P8); and, the modernization and mechanization within
the logging sector (P4 & P6). The move to the FRPA was a move away from government
being overly prescriptive to a more results based model. The magnitude of the shift was
commented on by participant P3: “[s]o huge changes in terms of the long industry
involvement in meeting objectives and the whole move to professional reliance […]” (p. 6).
While the transition from the Code to the FRPA was occurring prior to the Liberals coming
to power, participant P8 speculated the following:
[…] I think the changes were thought out, that FRPA and appurtenancy and all those
things were all linked together I think, to help transition that move from the
Practices Code, to industry being responsible and government stepping back from
managing (p. 5).
As for the increased involvement with and for communities and First Nations, the
involvement was seen as a positive by many and as a means of both creating opportunities as

98

well as providing compensation (P4, P7, P8, P9, P10, P11, P14 & P15). The sentiment of
redistribution was held by participant P7, who said:
[…] the whole Bill 28 take back, and redistribution of some of the volume. Clearly,
that has helped facilitate a couple of things: 1) more smaller community-based
tenures, which has been interesting and has been, I think, generally positive, and the
same thing with First Nations volume. You know, government buying that back that
volume has provided the opportunity for a whole lot more First Nations groups to
have a more active part in the forest industry, which I think really helps (p. 8).
Theme 5: Timber Stewardship
During the mountain pine beetle epidemic the choice was made to accelerate the
harvest to accommodate the salvage of lodgepole pine timber before it lost its economic
value. One of the consequences of the choice to accelerate the harvest for the study area is
that there will be a substantial reduction in timber supply for the mid-term. Further, in 2012
the Auditor General of British Columbia criticised the stewardship of timber in British
Columbia. Both the accelerated lodgepole pine salvage harvest and the Auditor General’s
criticism served as the context in which I developed this theme. I wanted to know from
participants if they thought that timber stewardship had been compromised by the changes
made through Bill 29.
At different points during the interviews many participants made reference to the
transition from the Forest Practices Code of British Columbia Act 1995 (Code) to the Forest
and Range Practices Act 2004 (FRPA), and these references continued during the discussion
about timber stewardship. Several participants felt that the Code, for all its flaws, was a
superior stewardship regime to that of the FRPA (P1, P5, P12 & P13). While for others (P2,
P3, P6, P9 & P15) the suggestion that timber stewardship and Bill 29 were connected seemed

99

inconceivable. As participant P6 said: “I don’t think that the stewardship and the actual
milling of the timber are connected at all” (p. 14). The sentiment of separation between
stewardship and harvesting was also alluded to by participant P3, who said:
Did 2003 really help, particularly, the shift to the professional reliance model helped
bring more accountability on the industry side, I personally think that… if you go
back into the 80s, there is just no comparison as to the Code era and into FRPA era,
significant improvements on the stewardship side of the business (p. 7).
While the majority of the participants were of the opinion that the timber resource
had not been compromised (P1, P2, P3, P4, P6, P9, P11, P14 & P15), some thought it could
have been managed better (P4, P6 & P11). As participant P4 stated,
I think some of the fundamental issues around stewardship of the resource weren’t
addressed in the Forestry Revitalization Act because even when you’re talking about
Community Forests it sounds great, but I mean essentially it’s about reallocation of
timber rights and harvesting to certain people (p. 7).
There were also participants who thought that the stewardship of the timber may have been
compromised (P7, P8, P10 & P12), but their reasons varied. For example, participant P10
thought that a lack of timber stewardship arose from different factors:
We have had some problems for a while, and I think it comes outside of those Acts,
just lack of funding coming into inventory, lack of funding going into research and
those kinds of things, which weren’t necessarily linked with the Acts (p. 6).
While the others felt that the timber stewardship may have been compromised because the
timber resource has been over allocated (P7, P8 & P12), as participant P8 pointed out, “[…]
there’s too many players on the land base” (p. 11). Still, others believed that the timber
stewardship had been compromised primarily because of a shift in governance (P5 & P13).
As participant P5 explained:

100

I thought that the period in history when we went through CORE and LRMPs, was a
highlight of good governance. I thought we did a very good job reaching
accommodations and restoring the public’s faith in the landlord of the province, and
I thought that that as well secured the future of the forest industry. I actually think
we’ve taken a step back […] (p. 5).
Theme 6: The Conversion of Forest Licences to Tree Farm Licences
In the spring of 2013, the government unsuccessfully tried to introduce legislation
that would allow the conversion of forest licences to tree farm licences. Prior to 2013, in
August 2012, the Special Committee on Timber Supply released its report and one of the
recommendations made to the legislature was to explore the possibility of converting volume
based tenures to area based ones. I was curious if government was indeed acting on the
recommendation of the committee so I asked participants about this theme.
When I asked the participants about what they thought motivated government some
thought that it was to provide industry with more security (P2, P3, P8, P9, P10, P11, P12 &
P14), while others thought that it was a mitigation strategy for the mid-term timber supply
(P1, P4, P5, P6, P7 & P15) as well as to provide investment incentives while transferring
silviculture liabilities (P7, P8 & P13). In reality, all of the aforementioned reasons could be
connected with the mountain pine beetle epidemic, which was summed up by Participant P15
who said: “[m]y short answer is that I think it was a desire to improve stewardship and
investment in the forest basically” (p. 7).
There was a lot of discussion by a few participants (P2, P4, P6 & P15) regarding the
fallacy that equates area based tenures, as opposed to volume based tenures, with better
stewardship. The aforementioned logic is typically based on a set of assumptions made
regarding the greater certainty offered by area based tenures: that greater certainty will lead

101

to better investment on the land base; and that better investment in silviculture can potentially
lead to a larger timber supply (P2, P6 & P15). However, as participant P2 argued: “[p]eople
have to want to increase stewardship and they have to want to increase timber supply […]
area based tenures have not done that […]” (p. 8).
The participants were almost equally divided on the question of whether or not they
supported the idea of such a large timber tenure conversion. However, even those who did
support it would only support the conversions where it made sense to do so, not a broadbased conversion of all forest licences (P4, P5, P6, P7, P8, P9, P11, P12, P14 & P15).
Participant P4 said:
Part of the problem of volume based tenures is that, by their nature, they don’t
promote the culture of stewardship and care of the land base… if you are worried
about where your volume is coming off it, and you are competing with many other
people, you can’t have thoughtful stewardship (p.8). […] So I think where it’s
economically or ecologically appropriate, area based tenures are a very good thing
(p. 9).
There were several participants who were not in support of converting forest licences into
tree farm licenses. A few participants thought that the conversion would equate to giving
lumber producers tree farm licences (P1 & P13). Another participant thought that the
conversion was not practical, citing that government would have to find suitable land base in
the midst of needing to fulfil commitments made to First Nations (P2). Finally, participants
did not support the conversion given the general uncertainty surrounding the implications of
a declining timber supply over the mid-term (P10 & P13). The uncertainty was addressed by
participant P13, who said:

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You and I can’t predict what’s going to happen five to ten years from now with our
land base, or the issues that any government or any community is going to face, so
putting it under tenure for sawmills might not be the right thing (p. 13).

Theme 7: Future Forest Policy Needs
I developed this theme of future forest policy needs because, despite all of the
change that has occurred within the past fifteen years, the forest industry is still facing
multiple challenges moving forward. Policy must continually evolve to remain effective and
relevant to that which it governs. I purposely left the questions open-ended so as to find out
from participants what they deemed important to ensure that the forest industry remained
strong now and into the future.
The conversation with participants about future policy needs that would ensure the
survival of the forest industry ranged from managing the land base, to managing our
obligations to First Nations and communities, to managing the timber supply. On the subject
of managing the land base, several participants thought that the Forest and Range Practices
Act 2004 needs be updated because government needs to be clearer about what it wants from
the land base (P3, P6, P7, P8 & P13). Some participants talked about all of the provincial
land use plans and the need to have them updated (P4, P6 & P14). Participant P6 commented:
We’ve got good land use plans, however, I think the land use plans need to be
updated, I think they need to be modernized, I think they need to be nurtured and
cared for in a Crown land model. I think the government needs to be clearer on its
objectives (p. 16).
Other participants recognized the significant role that First Nations will play moving forward
(P3, P6, P7 & P14). Participant P14 observed: “[…] the natural evolution and development of

103

public policy I think will change significantly based on the Tsilhqot’in decision4 of this past
summer” (p. 12). Participant P7 agreed, and made the following recommendation:
So I think collectively we’ve got to get our heads around, how do we transition to a
place that recognizes the fact that there is title out there and that First Nations have
to get benefits, how do we transition to that in a way that doesn’t unduly impact the
finances of either the companies or government (p. 10)?
There was also considerable discussion around what the implications of a reduced
timber supply would look like for industry as well as for communities. Some participants felt
that the industry needs to be more diverse and that there should be more area based tenures
on the landscape (P1, P9, P10 & P12). As well, timber rights need to be more secure (P4 &
P12) and processes streamlined (P11). There was certainly concern regarding how
communities would fare as the timber supply shrinks and the forest industry reconfigures
itself once more. As participant P3 pointed out:
[…] we have a number of communities that will be hit pretty dramatically so that’s
probably the biggest thing to watch, is how we handle diversification with the
limited opportunity that we have in a declining AAC […] (p. 10).

Some participants felt that government should give communities more say regarding the
forests that surround them (P5 & P10). But, as participant P10 warned:
[…] government has to be more engaged in developing the whole package, or
helping to support that anyways. People are incredibly entrepreneurial if you can
give them an opportunity and some education and a way to make money that hasn’t
been considered before. You can’t just throw land at people and expect it to work
out (p. 7).

4

The Tsilhqot’in decision was a recent historical ruling in which the Supreme Court of Canada established
that the Tsilhqot’in Nation had both rights and title to a specific area within their asserted traditional territory
(Tsilhqot’in Nation v. British Columbia, 2014).
104

A few participants discussed the need for creating industrial forest zones, where
intensive timber management could be practiced so more volume per hectare would be
produced (P2 & P15). One participant talked about the need to create a plan for how to divide
a reduced timber supply amongst many licensees (P13), while others talked about managing
cumulative effects (P3) and adjusting timber pricing to reflect changing conditions (P6).
However, regardless of the repercussions the industry will face during the mid-term,
participant P9 was hopeful about the long term timber supply, saying: “I think the forest
industry is going to survive alright, just because we have lots of area and lots of trees out
there; so we just have to wait for them to grow up” (p. 11).
These next themes were identified from the interview transcripts through a number
of iterations to formulate and amalgamate subthemes. Each of these themes has an associated
table that shows the relative number of times the subtheme was discussed by each group.
These four themes were deemed relevant because they scored greater than 100 for all
subthemes and groups. See Appendix VI for the remaining themes identified. As well, in
these last four themes, the relative frequencies of subtheme indicators by group are shown in
tables to demonstrate the theme construction (see Tables 6 to 9).

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Theme 8: Factors that Influence Business Decisions
Table 6: Theme 8 subthemes and the relative frequency of subtheme indicators by group.
Theme 8: Factors that Influence Business Decisions
Subtheme
Group 1
Group 2
Industry
Government
Economic Bottom Line
45%
36%
Centralization
0%
0%
Compensation
50%
50%
Labour Force
42%
34%
Logistics
17%
0%
Shareholders
9%
27%
Timber Profile
25%
50%
Transportation
22%
66%

Group 3
Other
18%
100%
0%
25%
83%
64%
25%
12%

Identifying what factors influence business decisions is helpful to understand why
lumber producers make the business decisions that they do. Some of these business decisions
have to do with where sawmills are strategically located, and some of the factors that
influence these decisions are not as obvious as others. For example, the top three factors
identified by participants were the economic bottom line, labour force availability, and
transportation (see Table 5). The interconnected nature of these factors was explained well
by participant P8, who said:
One of the economic decisions that is made is where logs should be delivered to
enable a profit to be made. If factors such as mill technology, work force
availability, operating costs (such as energy costs) transportation availability (ie
trucks or rail) allow a facility to run at a profit and conversely another mill at a loss,
business decisions would now allow the wood to be hauled to a profitable facility
rather than a non- profitable facility (p. 7).
Participants discussed other factors that influence the business decisions of lumber
manufacturers, such as the following: the centralization of manufacturing, as a matter of
capturing the economies of scale; the compensation paid to the industry by government for
the loss of timber harvesting rights; and, the reality that many lumber manufacturing firms
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have shareholders to whom they must answer. Almost everything influencing a business
decision can be traced to improving profitability and viability. Even operational factors like
logistics (the location of timber versus the mill, versus the market) or the timber profile (the
species, size, and grade of timber being harvested) influence business decisions. As described
by the following participant:
[…] they don’t have a lot of duplication in their operations. What I mean by that is
where you might have had two or three stud mills before, and one dimensional
lumber mill, maybe depending on how you revamped your operations with regard to
your timber supply […], you might be able to position those mills in better places
depending on what the products are coming in (P11, p. 5).
Perhaps the most surprising factor influencing the business decisions of lumber
manufacturers is labour force availability. Finding capable employees is, as participant P7
noted, “[…] another complicating factor which is that rural BC… rural Canada’s all moving
to town” (p. 7), and the problem is ongoing. It is not only finding people who want to live in
smaller communities, but having to compete with the oil and gas sector:
Drawing people to some of the smaller communities is problematic given the
shortage of workers today. I don’t think the province or industry at the time realized
how difficult it is to draw good people to some of the outlying locations (P8, p. 15).
Theme 9: The Competitive Log Market
Table 7: Theme 9 subthemes and the relative frequency of subtheme indicators by group.
Subtheme
BC Timber Sales
Log
Log Market
Tenure Reform
Value-added Sector
High End Products

Theme 9: The Competitive Log Market
Group 1
Group 2
Industry
Government
35%
53%
36%
50%
0%
100%
0%
100%
22%
41%
40%
20%

Group 3
Other
12%
14%
0%
0%
37%
40%

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During the interview discussions participants had quite a bit to say about the
competitive log market, particularly the value-added sector, or lack thereof. This theme is
important because the development of a competitive log market was a key component of the
Forest Revitalization Plan. As participant P1 explained:
[…] when you read the Forest Revitalization Plan there was a whole suite of
outcomes that they expected around stimulating the value-added wood industry, […]
and those things have not come to fruition. The value-added wood sector has
actually withered under the Forestry Revitalization Plan […] (p. 5).
According to the participants, one cannot discuss the impact of Bill 29 without considering
the role that Bill 28 played. Bill 28 involved the ‘take back’ of timber volume by government
from the forest licence agreement holders in order to reallocate timber for community forest
agreements, First Nations, and woodlots, as well as provide volume for BC Timber Sales
(BCTS) (Bill 28, 2003).
The key role of BC Timber Sales (BCTS), as explained by participants, was to
provide a competitive log market. The creation of BCTS served two purposes: to create the
Market Based Pricing System, upon which provincial stumpage rates were generated; and to
provide a supply of logs for other would be entrants to the market. Some participants felt that
the forest industry has become more diversified as a result. Still, despite a diverse group of
players, many participants felt that there is still too much focus on lumber manufacturing.
Participant P14 noted:
We’re still not there as an industry when you take a look at some of the species that
we have in the province of British Columbia and you take a look at just making
commodity based lumber out of it. There seems to be a disconnect […] (p. 17).

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While a few participants believe that the value-added sector was just not a profitable
venture, especially given the high costs of labour and transportation, others suggested that the
absence of the sector had more to do with a lack of timber supply for would be investors.
Referring to the lumber manufacturing firms, participant P5 stated: “[t]he big boys didn’t
want it, so they killed it” (p. 9). Participant P12 explained:
Most of them focus way too much on dimensional lumber. And they don’t look
enough at alternate markets. In fact, they don’t want alternate products to succeed.
They didn’t want the value-added sector to succeed, so the value-added sector didn’t
succeed… for the most part because the big boys didn’t want that competition. […]
For the wood! Not the market, because it’s a totally different market (p. 6).
Although participants did not agree on the reasons for the absence of a flourishing valueadded sector, many agreed that too many high value logs are converted into commodity
lumber, as was voiced by participant P10,
I really think we need to start making better investments into figuring out better
ways to use every cubic metre that we have. Changing that industrial model, not
100% away from what it currently is, that’s always, probably always be the bread
and butter for BC (p. 8).
Theme 10: The Disposition of Timber Rights
Table 8: Theme 10 subthemes and the relative frequency of subtheme indicators by group.
Theme 10: The Disposition of Timber Rights
Subtheme
Group 1
Group 2
Industry
Government
Timber Allocation
59%
21%
Timber Rights
42%
31%
Operating Area
50%
50%

Group 3
Other
20%
27%
0%

The disposition of timber rights in the future will be increasingly important,
particularly moving into a much smaller mid-term timber supply where the competition for
timber supply is already fierce. As participant P11 illustrated:

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[…] what we never really thought about is, on the land base, there are always too
many constraints, and so, how do we make it all fit? And you know, if you look at
some of the other future states, of what the tenure system might look like, how to try
to fit in First Nation Woodland Licences for example, at the end of the day you only
have so much pie, and right now the pie’s pretty much already spoken for (p. 4).
Though it seems inevitable that the shrinking timber supply will force another rationalization
by the forest industry, concern remained among participants as to what these changes will
mean for the timber rights currently held. To confound the issue is the reality that
government has some outstanding obligations to fulfill to First Nations:
[…] [it is] absolutely critical that as we look at mid-term timber supply and then we
look at adjustments to annual allowable cuts, how that reduction in cut is handled
and how it is proportionally shared between big companies and small companies.
[…] The other challenge for us will be again the Tsilhqot’in decision has made it
very clear that First Nations will play a much much larger role on the landscape, and
what does that mean in terms of timber supply […] (P14, p. 11).
Participants explained that many licensees have seen their operating areas shrink
over time due to increased constraints and the number of licensees operating on the same
land base. The uncertainty around timber rights has caused considerable angst for them not
only in terms of timber supply, but in terms of managing the land and running a business. A
few participants noted that in some cases the overlap of tenures has created so much
competition that different licensees are literally chasing the same tree. It is not just about who
can get ribbon around the timber first, it is about who can log the timber first.
Despite the situation of an already crowded land base, many participants
acknowledged the importance of involving First Nations and giving them timber tenures on
the land base. The primary concern expressed by many participants was that any reallocation

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of timber supply needs to ensure that it is both inclusive and equitable to all. However, as
participant P8 reminded me:
Government has to govern for the best outcomes for the province and communities
need to ensure benefits, employment, sustainability, and sound forest management
on the forests that directly affect them. The debate of who owns the trees, the rights
to manage the forests, and the economics generated from the forests will always be
there (p. 8).

Theme 11: The Lumber Manufacturing Business
Table 9: Theme 11 subthemes and the relative frequency of subtheme indicators by group.
Theme 11: The Lumber Manufacturing Business
Subtheme
Group 1
Group 2
Industry
Government
Dimensional Lumber
19%
70%
Residual Products
52%
36%
Crown Revenue
66%
24%

Group 3
Other
11%
12%
10%

Participants discussed various aspects regarding the lumber manufacturing business,
which makes this theme important because it gives a broader perspective, which will foster a
greater understanding of the current forest industry. The key to the success of any lumber
manufacturer is to maximize the utilization of the entire log profile and to keep costs as low
as possible, which involves not only creating efficiencies, but utilizing the waste stream. The
concept was explained well be participant P8, who said:
By-products directly from the forests or from sawmill facilities is a significant
portion of revenue/costs for any forest company. To reduce costs there must be an
outlet for the by-products, such as chips, sawdust, log waste. The industry has
responded well in the past decades with pulp mills, pellet plants and now energy
plants. These facilities exist as a result of the primary harvest and saw milling
components of the forest industry (p. 8).

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The concept of maximizing utilization of the log is particularly true for lumber manufactures
in the Prince George Timber Supply Area given the cost of capital investments and distance
to markets. For example, “[t]o continue to produce commodity based lumber, you are looking
at a 100 million dollar investment to be competitive with modern day scanners” (P14, p. 5).
Then the product has to get to markets around the world:
[…] these are mills in northern British Columbia that have to mill their product and
get it to markets that are a long way away. They’re not sitting in the southern United
States, or on the eastern seaboard. They have to ship their product all the way from
northern BC into Chicago, down the railroad, into the southern US, or into Texas,
into California, it has to go a long way, or across the ocean into Japan or Europe
(P6, p. 6).
According to some participants, the investment in capital upgrades for sawmills that
are strategically located has meant that more lumber can be produced more efficiently with
less waste, and that those waste products have a market. Further, the high production capacity
of these modern sawmills is flexible, in that it can be increased or decreased by adding or
subtracting shifts. The flexibility of production has allowed producers to be more responsive
to market demand, as well as respond to the milling demand created by the mountain pine
beetle epidemic.
On the harvesting side of production costs, participants noted that the logging
systems and trucking configurations have also adapted to the pressure of greater production.
For example, logging systems switched to roadside processing and short log lengths, which
enabled the short log truck configurations to haul more logs per truck load. Participants
explained that the change on the harvesting side of the business was a necessary shift because
the harvest in the Prince George Timber Supply Area was focused on salvaging lodgepole
pine, which meant Forest Licensees were traveling greater distances from their milling
facilities for timber that was of marginal quality and relatively small.
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Another cost of concern when producing lumber, as explained by participants, is the
price that is paid for the timber; the price of stumpage. While lumber producers are always
concerned about how much they are paying for timber, there was some concern among
participants that stumpage in the future might be increased to accommodate revenue sharing
with First Nations, which would most certainly make lumber production costs prohibitive.
Meanwhile, some participants were concerned that the current appraisal system unfairly
discounts the publicly owned resource in favour of lumber producers. Although this concern
could not be substantiated by any facts, participants were unwilling to discuss the issue
further, citing the ongoing softwood lumber dispute with the United States.
5.6. Conclusion
These research findings have demonstrated the interconnectedness of seemingly
independent events within the broader context of the forest industry, the forest economy, and
the forest landscape through time following the forest policy choices of that were set in
motion in 2003. While certain aspects of particular events have been explained, the
explanations are incomplete because of the influence exerted by other events that were
happening simultaneously. Hence, this story is only a partial story of about how lumber
manufacturing companies in the Prince George Timber Supply Area responded to the
changes made to legislation in 2003 by Bill 29. In the next chapter I will draw upon the
literature to connect this case study to the broader theories therein.

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Chapter 6: Discussion
6.1. Introduction
This chapter will connect the key findings from this case study to the theories
explained in Chapter 3. The chapter will begin by discussing the key findings and impacts
resulting from the rationalization of the forest industry, which will be followed by a
discussion regarding the timber harvest and valuation. Next, the impact of the mountain pine
beetle will be discussed in light of how the forest industry and government responded to the
crisis. Finally, the discussion will shift to answering the research questions which will
determine how the theories explained in Chapter 3 inform this case study and where this case
study fits within the broader context of British Columbia.
6.2. Rationalization of the Forest Industry
Although the closure of Pope & Talbot Inc. and Stuart Lake Lumber Co. Ltd. could
be linked to financial difficulty (Hamilton, 2008), according to several interviewees (P1, P2,
P4, P6, P7 & P14), as well as documentation found within an annual report (Canfor, 2011),
the remaining mill closures in the Prince George Timber Supply Area were part of the
ongoing rationalization being undertaken by local forest companies as a means of remaining
competitive in the global marketplace. Decisions were made as to which mills to close and in
which mills to make capital investments. These business decisions considered things like the
geographic location of the mill relative to the location of an appropriate timber supply, which
was one of the driving reasons for the closure of Canfor’s Clear Lake sawmill (Canfor, 2011).
In the case of Canfor’s Rustad sawmill, the cost of upgrading was deemed too costly (Canfor,
2011).

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Perhaps the greatest impact of the consolidation and capitalization of the lumber
manufacturing sector was the negative impact that it had on many communities, particularly
those whose economy was dependent on the forest industry. While all of the interviewees
agreed that the consolidation of the industry had a negative impact on communities, some
interviewees (P7, P8, P11, P14 & P15) felt that the overall stability of the industry had
improved. Still other interviewees (P3 & P15) speculated that these negative impacts to
communities were in some cases partially mitigated by the timber volume expropriated by
Bill 28, which allowed government to reallocate those timber resources to communities in the
form of community forest agreements (Bill 28, 2003). In terms of First Nations communities,
several interviewees (P7, P10, P14 & P15) noted that there has been a significant increase in
participation by First Nations within the forest industry, in the form of partnerships with
other industry stakeholders, revenue sharing agreements, and the allocation of timber tenures.
Provincially, the job losses in the forestry sector for 2004 and 2008, and the wood
manufacturing sector for 2008 were directly related to the changes brought about by Bill 29.
By freeing the industry to rationalize the lumber manufacturing business, companies were not
only free to decide how to best configure the manufacturing side of their business, but, the
timber harvest as well. So, the process of rationalization impacted employment within the
wood manufacturing sector and the forestry sector. According to interviewees, the logging
sector underwent a period of consolidation and reconfiguration which reduced the number of
logging contractors. Forest companies were now able to demand leaner business practices
from their logging and trucking contractors and technology provided the means to do so (for
more information see Theme 11: The Lumber Manufacturing Business in the previous
chapter, pages 111-113).

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In terms of diversity within the forest industry in the Prince George Timber Supply
Area, there were mixed views held by interviewees. A few interviewees felt that the industry
as a whole is more diverse as a result, citing the rise of the bio-energy sector (P3 & P11),
whereas others thought that the industry was less diverse, stating that there are only one or
two companies and virtually no value-added sector (P1 & P13). Yet, it appears that in the
Prince George Timber Supply Area, at least in the lumber manufacturing sector, that there is
a good mix of medium and large sized companies. Of the eleven large lumber manufacturing
mills located within the Prince George Timber Supply Area in 2011, five are owned and
operated by larger publically traded companies, three are medium sized independent
companies that work cooperatively together, and two are medium sized independent and
family run companies (FLNRO, 2015a).
From an employment standpoint, diversity which includes smaller independent
lumber manufacturing companies may bode well for communities as recent studies have
shown that these smaller firms may offer more stable employment. In one study, smaller,
more specialized timber processing firms located in the southern interior of British Columbia
were found to be more stable in terms of employment and more resilient to economic shocks
(Pinkerton & Benner, 2013). Furthermore, another study that examined employment stability
in the wood processing sectors in the United States and Japan between small, medium and
large companies found that the greatest employment instability was found in the large
companies (Lee & Eckert, 2002).
Since the rationalization of the forest industry through the 2000s, one factor
regarding employment has changed, it is that people in rural areas are commuting for work
more than they did in the past (Haan, Walsh & Neis, 2014). An increase in commuting was

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noted to occur within the Prince George Timber Supply Area by a few interviewees (P4, P7
& P8), who said that people do not necessarily live where they work anymore. Haan et al.
(2014) term the phenomenon, employment related geographical mobility, which they
describe as a non-traditional form of commuting where people in Canada are not just
commuting from rural places to the city, but from the city to rural places, or from rural places
to rural places. The increase in commuting has to do with the increasing demand for the
workforce to be more flexible (Haan et al., 2014), but also because people are more willing
to live where they want to live and travel to work (Halseth & Sullivan, 2003).
The trend of increased commuting for work between rural areas and from urban to
rural areas is interesting to note because as of December, 2011 there were a total of 11 large
lumber manufacturing mills located within the Prince George Timber Supply Area (FLNRO,
2015a), and over half of these mills were located outside the boundaries of nearby
municipalities. Perhaps the shift in workforce flexibility could also be seen as a result of the
changing work place location. According to interviewees, there are several strategic
advantages to having these geographic locations (for more information see Theme 8: Factors
that Influence Business Decisions in the previous chapter, pages 106-107). The first is that
these companies do not have to pay the taxes associated with being located inside a
municipality (Martin, 2013). The second is that they can draw employees from more than one
municipality (Haan et al., 2014).
The potential advantage of locating outside of municipal boundaries can be
illustrated using companies located within the Prince George Timber Supply Area. For
example, Canfor has a mill located at Bear Lake and another at Isle Pierre. Bear Lake is
located approximately 74 km north of Prince George and 109 km south of Mackenzie, while

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the Isle Pierre mill is located approximately 50 km west of Prince George and 50 km east of
Vanderhoof. Similarly, Dunkley Lumber Ltd. has a mill located at Strathnaver, which is
approximately 79 km south of Prince George and 43 km north of Quesnel. Many
interviewees identified that there is an ongoing shortage of labourers, millwrights, and
professionals. So perhaps choosing to keep and invest in mills situated mid-way between
communities has allowed companies to draw from a larger labour pool (for more information
see Theme 8: Factors that Influence Business Decisions in the previous chapter, pages 106107).
Perhaps stability for individual people does not mean what it used to. In other words,
the kind of stability that accompanied the booming forest industry of the 1960s in British
Columbia does not meet with the same standard today. In the 1960s, individual personal
stability likely meant living in the same town that you worked in and that you had a steady
well-paying job throughout your entire career. Whereas today’s definition may be more
flexible in that people are expected to have to change careers multiple times in throughout
their lives. Maybe individual personal stability today means having enough steady income to
be able to live where you want to. In which case, the location of the lumber manufacturing
facility would be less important to employees than the resilience of the mill.
6.3. Timber Harvest and Valuation
The results from the harvest data and interview analyses clearly demonstrate that
both the Prince George District and the Prince George Timber Supply Area (PGTSA) serve
as processing hubs, for the Timber Supply Area itself and for the northern interior. As the
PGTSA is the largest contributor to the provincial allowable annual cut (AAC), it was
important to investigate the concerns raised by interviewees, that too much non-pine and

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spruce was being harvested. The fact that the ministry responsible for forests (MFR, 2007)
and this research show that the expectations of the Chief Forester appear to have been met
does not mean that the concerns raised have no validity. On the contrary, I think that their
concerns speak to the stewardship of the timber resource rather than to the specific adherence
to the Chief Forester’s expectations. In short, concern that harvesting more green timber now
means less available for harvest later, for the mid-term. Recently, both Canfor and West
Fraser were found to be harvesting more green timber than they were supposed to be in the
Morice Timber Supply Area (Hunter, 2015).
In the Prince George Timber Supply Area licensees were also found to be harvesting
more non-pine leading and spruce leading stands in the 2012-2013 and 2013-2014 fiscal
years and less lodgepole pine (Forest Practices Board, 2014). Both cases revealed that the
alleged violations would not or could not be enforced by government. In the case of the
Prince George Timber Supply Area, the allowable annual cut (AAC) uplifts (Pedersen, 2004)
and subsequent partitions (Snetsinger, 2011) are classified as expectations of the Chief
Forester, which are not bound by legislation and, therefore, are not enforceable (Forest
Practices Board, 2014). The evidence noted above is by no means conclusive, yet, it does
suggest that perhaps government expectations of licensees do need to be regulated through
statutory law so that they can be enforced.
While my research did not find any excess harvest of non-pine coniferous timber, it
did reveal that the cruise based appraisal of non-pine coniferous species produced a much
lower stumpage value than the conventional appraisal method in 2010 and 2011.
Unfortunately the stumpage appraisal system is complex, consisting of a myriad of variables,
all of which are used to calculate stumpage rates. Some of the factors that feed into the

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stumpage calculation include, but are not limited to: administration costs; development costs;
road management costs; basic silviculture cost estimates; low grade percentage adjustments;
market pricing system selling prices; estimated winning bid variables; log transportation;
specified operations; and a consumer price index (MFR, 2010c). It is because of the above
noted complexity that there is no way to know for certain if there was a loss in stumpage
revenue due to the cruise based appraisal, when a full appraisal may have yielded similar
stumpage rates. What is certain is that forest licence holders were increasingly using the
cruise based method of stumpage billing, which demonstrates that there was an economic
advantage to do so, be it through lower stumpage rates or reduced administrative costs.
Still, in terms of revenue, British Columbia is receiving less in the form of stumpage
than it ever has in the past, with stumpage revenues falling in the Prince George Timber
Supply Area from $292 million to $15 million from 2000 to 2011. As my results show, part
of the revenue decline was due to the focus on harvesting lodgepole pine and part is due to
the degrading timber and the application of the minimum stumpage rate.5 Finally, despite the
complexity of the appraisal system, it may be that the factors that feed into the calculation of
the stumpage rate are the variables that explain the much lower stumpage rates from 2007 to
2010. The Market Pricing System began to be used in 2006 for the Interior timber appraisal
process, as a system of reflecting market conditions more accurately. Hence, it could be
argued that the extremely poor lumber market conditions from 2007 to 2010, combined with
factors that were reflecting more costly development and logging costs as the lodgepole pine
5

The current minimum stumpage rate of $0.25/m3 was established by Order in Council 1935 (OIC
1935/1987) on September 24, 1987, and it has been in effect ever since. This new minimum stumpage rate of
$0.25/m3 was part of the comparative value pricing package put in place to change the way stumpage was
calculated (Grafton et al., 1998). While it is known when and why the minimum stumpage rate was changed to
$0.25/m3, I could not ascertain why the minimum stumpage rate was set to $0.25/m3, nor could I find any
justification as to why this minimum rate has not changed since 1987, not even to reflect inflation; if inflation
were taken into account, the minimum stumpage rate would have been $0.44/m3 in 2011.
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harvest moved further away from processing centres, contributed to the low average
stumpage rates.
Another important aspect to consider is that the interests of the forest industry are
not necessarily the interests of government, or at least they should not be. The business
interests of the forest industry are driven by profit, as illustrated by Canfor’s President and
Chief Executive Officer, Donald B. Kayne, in his address to shareholders:
In 2011, Canfor made substantial progress in delivering on our vision to be the
world’s most competitive forest products manufacturer. Our strategy is threepronged: to aggressively build global demand for our products, to secure the highquality, sustainable fibre supply to meet the demand we create, and then run
efficient production facilities to make high-quality products cost effectively (Canfor,
2011, p. 4).
While it is true that our provincial economy benefits from a healthy forest industry, the
benefits to the province have been clearly demonstrated by this case to be declining. The
above noted strategies are all components of mass production, a strategy that maximizes
production and minimizes cost (Edenhoffer & Hayter, 2013a; Nelson et al., 2007).
Ultimately, the owner of the timber is interested in getting the highest price for the log,
whereas the manufacturer wants to buy the timber at the lowest possible cost. Clearly there is
a conflict between the two interests which cannot be easily reconciled.
6.4. The Impact of Mountain Pine Beetle
Although the significance of the mountain pine beetle epidemic did not seem to be
on the government’s radar at the time that Bill 29 was being established (MOF, 2000; MOF,
2003; Nelson, 2007), the changes brought about by Bill 29 allowed the forest industry to
respond effectively to the crisis. Indeed, many interviewees (P7, P8, P11, & P14) commented
that had it not been for the changes made through Bill 29, the industry might not have been

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able to deal with the magnitude of the salvage harvest. As it was, the epidemic drove
companies to modernize with new technologies and capital improvements to lumber
manufacturing facilities to leverage the economies of scale.
The increasing degradation of quality in the lodgepole pine logs also forced the
increased utilization of the logs, as there was increasingly poor lumber recovery. Increased
utilization by the industry was confirmed by interviewees who explained that finding value in
the waste stream is critical for making lumber production economically viable (for more
information see Theme 11: The Lumber Manufacturing Business in the previous chapter,
pages 111-113). These investments also mean that the industry is able to produce more
products using fewer mills and a much smaller labour force; it also means that the industry is
more flexible in terms of production, by simply modifying the number of shifts operating at
any given time a company can reduce its output and its expenses. The question is what will
happen when the timber supply to these mills is reduced?
From a timber supply perspective the falldown for the mid-term supply in the Prince
George Timber Supply Area will be significant in that the allowable annual cut (AAC) is
predicted to be half of what it is today (Snetsinger, 2011). The successive increases to the
allowable annual cut (AAC) to accommodate the rapid salvage of lodgepole pine killed by
the mountain pine beetle epidemic helped to create a very efficient lumber manufacturing
industry by design, one that processed a lot of inexpensive timber over a very short time.
How will these high volume manufacturers be able to maintain their economic viability
without compromising either the future timber supply or the fair remuneration to the Crown
in the form of stumpage once the timber supply is reduced? Perhaps the most important

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thing to ascertain when the reduction in allowable annual cut (AAC) occurs is just what is a
sustainable level of harvest, and for whom?
According to some interviewees (P2, P7, P8 & P11), companies are, at least for the
interim, augmenting their supply from other Timber Supply Areas (TSAs), like the
Mackenzie TSA. In the same way that timber cut in the Prince George Timber Supply Area
was processed in other locations outside of the Timber Supply Area (TSA), likewise timber
cut in another TSA can be processed in the Prince George Timber Supply Area. However,
some companies are already transitioning in light of the reduced timber supply and are
invoking the ability to transfer their timber tenure agreements. For example, in 2013, Canfor
announced that it would close its sawmill in Quesnel in early 2014, and that it was making a
deal with West Fraser to exchange its timber harvesting rights in the Quesnel TSA and some
in the Lakes TSA for some West Fraser timber harvesting rights in the Morice TSA (Canfor,
2013). In this case, the agreement would have benefited both companies, as West Fraser had
substantial investments in Quesnel (Quesnel TSA) and Burns Lake (Lakes TSA), whereas
Canfor had substantial investment in Houston (Morice TSA). While the full impact of a
reduced timber supply has not yet come to fruition for the Prince George Timber Supply
Area, several interviewees (P2, P7, P8 & P14) indicated that the reduction in timber supply
will force another round of rationalization by the forest industry.
There was also speculation from a few interviewees (P1 & P8) that forest
corporations will choose to invest outside of British Columbia in the future. In fact, there is
evidence that companies within the Prince George Timber Supply Area are investing
elsewhere, specifically, Canfor (Canfor, 2015), West Fraser (West Fraser, 2016), and Conifex
(Penner, 2015). One motivation might be for companies to shock proof their investments

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given the short-lived and volatile nature of the Softwood Lumber Agreement (Penner, 2014),
another may be that companies are looking for an alternative and inexpensive source of
softwood fibre, like Conifex, which recently purchased a sawmilling facility in the State of
Arkansas (Penner, 2015). It is also possible that forest companies in British Columbia are
choosing to invest in the Southeastern United States because the regulatory burden is
significantly less there than it is in British Columbia (Cashore, Mcdermott, Auld & Newsom,
2006).
In the case of Canfor, it has been consistently investing and divesting in assets as a
strategy to improve its market share for some time. Canfor began applying the strategy in
2000 with the purchase of Northwood Inc. in British Columbia (Canfor, 2000). The strategy
was continued with the following acquisitions: a small sawmill in Quebec in 2003 (Canfor,
2003); Slocan Group in British Columbia in 2004 (Canfor, 2004); New South Companies
Inc., with facilities located in North and South Carolina (Canfor, 2006); a sawmill located in
Darlington, South Carolina in 2007 (Canfor, 2007); and, the solid wood processing facilities
from Tembec Industries Ltd. in British Columbia in 2011 (Canfor, 2011). Throughout the
2000s Canfor has not only acquired mills, it invested in upgrading for some while closing
others, and sometimes it invested in upgrades only to close the facility a short time later
(Canfor, 2000-2011). At present count, Canfor has invested in 17 timber product
manufacturing facilities in the Southern United States, 12 of which were acquired since 2011.
By comparison, Canfor has 18 such investments in Canada, 16 in British Columbia and 2 in
Alberta (Canfor, 2015).
It is important to look at how the forest industry and government conducted
themselves because it may be that while dealing with the multiple crises that occurred during

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the past decade, a resource economy that is addicted to low cost commodity exports (Burda
& Gale, 1998; Freudenburg, 1992) helped to create an industry that is committed to mass
production and one which may now be addicted to a low cost supply of timber. It also shows
that perhaps the forest industry is indeed in the final stages of its lifecycle (Edenhoffer &
Hayter, 2013b).
6.5. Research Questions Revisited
Though British Columbia may have not been leading the way globally in terms of its
forest governance mechanisms, it is recognized as being relatively progressive among forest
jurisdictions in Canada (Luckert et al., 2011; Haley & Nelson, 2007). In fact, other forest
jurisdictions in Canada are following British Columbia’s lead (Haley & Nelson, 2007). For
example, in 2011 the Ontario government revealed its plans to change its forest tenure
arrangements to something similar to those brought into effect in British Columbia by Bill 29
(OMNRF, 2011). So, while my research did not reveal any indication that British Columbia
looked to other forest jurisdictions for insight for its forest policy reforms, numerous
interviewees in this study (P1, P2, P5, P9, P12 & P13) stated that the BC Liberals consulted
heavily with the forest industry regarding forest policy changes. In fact, several interviewees
in the government group suggested that the forest policy changes of 2003 did not follow the
normal course of policy development in that the new government did not consult the ministry
responsible for forests. Rather, the government came in to power with the policy changes
ready to implement.
Looking back to my research questions, I do believe that the legislative changes
brought about by Bill 29 did help forest companies become globally competitive, but I
wonder if the cost to do so was worth it for British Columbia. Burda and Gale (1998) warned

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that British Columbia’s addiction to low cost commodity forest products would compromise
its future, yet, British Columbia still subscribes to the model of sustained yield forest
regulation, which continues to support the current forest industry. I argue that this case study
demonstrates that Bill 29 has weakened the overall forest economy of British Columbia by
reducing the contribution of the forest industry to the provincial GDP and limiting the
choices of future governments.
The recent consolidation of the forest industry was facilitated by Bill 29 in two
ways: by repealing the appurtenancy clause from the Forest Act 1996; and by allowing the
consolidation and subdivision of forest licences, as well as the ability to transfer forest
licences (Bill 29, 2003). The removal of the appurtenancy clause provided forest companies
with the investment flexibility to decide which mills to invest in and which to close without
incurring contractual penalties (Bill 29, 2003). The result was the consolidation of timber
processing facilities through rationalization. Consolidation of the forest industry also
occurred by reducing the number of corporate groups and companies that hold major timber
tenures in the province and as a result, concentrating the bulk of the available timber rights
into fewer hands.
In the Prince George Timber Supply Area, there is substantial evidence of the
rationalization of timber processing facilities. This rationalization is illustrated best by
Canfor’s decisions to close the Rustad and Clear Lake mills in the Prince George District
while making capital investments in the Plateau mill in the Vanderhoof District. However,
when Dunkley Lumber Ltd. purchased the holdings of the Stuart Lake Lumber Co. Ltd., the
choice to not re-open the mill in Fort St. James District was more than just an illustration of
investment flexibility. The purchase made by Dunkley Lumber Ltd. is a prime example of

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how some forest companies were able to take advantage of the crises that were impacting the
financial viability of other forest companies in British Columbia. With no appurtenancy
clause company holdings, which included forest licences, could be sold without the
obligation to run the mill originally attached to the forest licence.
Provincially, in 2011, the top five corporate groups and companies held 23% of the
existing major timber tenure agreements in the province (excluding woodlot licences and
community forest agreements), and 55% of the available timber supply (FLNRO
“Apportionment”, n.d. ). There was not much difference in March 2000, where the top five
corporate groups and companies held 19% of the existing major timber tenure agreements
and 50% of its available timber supply (FLNRO “Apportionment”, n.d.). But, a closer
evaluation reveals that 26% of the major licence holders had greater than a 1% share of the
provincial allowable annual cut (AAC) in 2000 as opposed to only 17% of the major licence
holders in 2011 (FLNRO “Apportionment”, n.d.). The situation has continued to worsen and
as of April of 2016, only 13% of the major licence holders in the province had greater than a
1 % share of the provincial allowable annual cut (AAC) (FLNRO “Apportionment”, n.d.).
As for the Prince George Timber Supply Area, not much changed in the
apportionment between 2000 and 2011 (FLNRO “Apportionment”, n.d.). The exception
being that Dunkley Lumber Ltd. acquired an additional renewable forest licence: A18169,
which formerly belonged to Stuart Lake Lumber Co. Ltd. This is not to say that companies
with processing facilities located within the Prince George Timber Supply Area did not
purchase renewable forest licences in other Timber Supply Areas, or that they have not
purchased such licences since 2011. Bill 29 has enabled a trajectory of acquiring timber
rights, but the full extent of its reach has yet to be comprehended. Bill 29 also allows the

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transfer of timber rights from one Timber Supply Area to another (Bill 29, 2003). As such, it
could be argued that the transferability of timber rights further strengthens sustained yield
forest regulation and the conversion to a normal forest.
In terms of contributing to the provincial economy, the forest industry is providing
far less jobs today than it once did. In 1998, the British Columbia Council of Forest
Industries (COFI) estimated that there were approximately 275,000 direct and indirect jobs in
forestry in British Columbia (COFI, 1999). However, in its recent economic impact report,
COFI estimated that there were approximately 145,800 direct and indirect jobs in 2013
(COFI, 2015). Provincially, the employment figures provided by the British Columbia
Council of Forest Industries (COFI) indicate a 47% decrease in jobs between 1998 and 2013.
While COFI claims that the British Columbia forest industry is still important to the
province’s economy, in terms of its contribution to the provincial GDP, the forest sectors
contribution to that GDP has fallen nearly 48% since 1998, from $23 billion (in 2015 dollars)
(COFI, 1999) to $12 billion (COFI, 2015). Given the reduced provision of employment and
contribution to provincial GDP it could be argued that the forest industry will garner much
less political capital going forward. However, given the entrenched commitment by the
government of British Columbia to continue to support the forest industry, it is unlikely that
the forest industry will lose its political capital anytime soon.
The irony of sustained yield forest regulation in British Columbia is that it was not
just about supporting communities, or mollifying the boom and bust business cycles of
commodity markets; it is primarily about liquidating old growth in order to produce a normal
forest, which is as idealistic as it is simplistic (Prudham, 2007). As the sustained yield forest
regulation model has neither supported communities by offering stable employment, nor

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mitigated the boom and bust cycles of commodity markets (Byron, 1978; Edenhoffer &
Hayter, 2013a), it can be assumed that it only supports the liquidation project of producing a
normal forest. Furthermore, the commitment to sustained yield forest regulation has
entrenched the commitment of British Columbia to continue to support the forest industry
(Prudham, 2007).
One does not have to look very far back in time to see that the government of British
Columbia is still committed to sustained yield forest regulation and the support of the forest
industry. Consider the mountain pine beetle epidemic. A natural disaster of this magnitude
has the potential to have significant environmental repercussions, yet, the government framed
the mountain pine beetle epidemic as a timber supply problem, not an environmental one
(Nelson, 2007). As well, the government also felt that it needed to create incentives for
industry to utilize more of the low value timber profile by introducing stand as a whole
stumpage appraisal (MFR, 2010d).
It is interesting that the government felt it needed to provide incentives to the forest
industry to utilize low quality timber, because according to a number of interviewees creating
value from the residual products of lumber manufacturing is necessary for the business to
remain economically viable (for more information see Theme 11: The Lumber
Manufacturing Business in the previous chapter, pages 111-113). Of course, the utilization
has to do with processing a log that has already been delivered to the mill, not the timber in
the forest. But with increasingly economically marginal stands being harvested the forest
industry will maximize utilization because it reduces costs. It could also be argued that the
government provided these financial incentives not solely for the purpose of encouraging
utilization, but so that licensees would harvest these economically marginal stands.

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The commitment of British Columbia to support the forest industry is within the
mandate of the ministry responsible for forests and is embedded within the timber tenure and
timber pricing systems (Rayner et al., 2001). The regime of sustained yield forest regulation
has been in place nearly 70 years and any attempt to make any change it would be difficult as
it is an institution in its own right (Prudham, 2007; Fréchette & Lewis, 2011). Not only are
there substantial legislative changes to contend with (rules), but, the existing sub-sector,
which is made up of the timber tenure and pricing systems, has so far been very effective at
blocking any attempt to thwart the trajectory of supporting the forest industry (Rayner et al.,
2001). Further, the regime, which is rooted in ideology, is also a tenet of scientific forestry in
British Columbia and, therefore, within the curriculum taught to those studying forestry.
Students who go on to become forest professionals then have the position of elite expertise,
occupying positions within the forest industry and government (Prudham, 2007). Finally,
membership is restricted to government and the forest industry (Rayner et al., 2001).
Perhaps the government of British Columbia has gone too far with placing forest
management in the hands of the forest industry. Although government does set the objectives
for managing components of forest ecosystems,6 it is constrained by the very legislation it
has created to manage the forest resource and regulate the forest industry (Petersen & Stuart,
2014). These legislative changes, that were influenced by neoliberal ideology (Hayter &
Barnes, 2014; Young & Matthews, 2007), have granted a much more significant role to forest
companies (Petersen & Stuart, 2014). Specifically, Bill 29 removed several major constraints
of holding timber rights which effectively granted unfettered access to public timber to the
wood manufacturing sector. These legislative changes may have also challenged the
6

The specific objectives set by government objectives can be found in the Forest and Range Practices Act
under the Forest Planning and Practices Regulation, Part 2, Division 1.
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institutional relationship between the provincial government and the forest industry.
Although the provincial government still has the constitutional authority to make the rules
that apply to provincial forests (Fréchette & Lewis, 2011), the power to decide what the rules
are may have shifted to the forest industry (Petersen & Stuart, 2014).
One thing that is clear: should the government of British Columbia wish to retract
timber rights from existing timber tenures it would have to compensate the holders of those
rights (Luckert et al., 2011). The compensation for the 8.2 million cubic metres of timber
retracted through the Bill 28 allowable annual cut expropriation was budgeted to be $200
million dollars (Niquidet, 2008). Given that the current volume held by replaceable forest
licences in the province is 28.7 million cubic metres (FLNRO, 2016b) the compensation that
would have to be paid for these existing timber rights would be unaffordable. It is more likely
that the current regime of sustained yield forest regulation will have to run its course before
any substantial changes can be made to British Columbia’s timber tenure and pricing systems.
As Edenhoffer and Hayter (2013b) have stated, the current forest industry in the province’s
Interior forest region is most certainly in the final stages of its life cycle. It is possible that
like the Coast forest region (Edenhoffer & Hayter, 2013a; Pearse, 2001), once the viable
timber supply is exhausted, the forest corporations that currently dominate the forest industry
in the Interior forest region will divest themselves from British Columbia to make way for
the much smaller, but more diverse value-added timber processing sector. In the meantime,
there most certainly will be further rounds of rationalization in the Prince George Timber
Supply Area once the timber supply is drastically reduced.

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Chapter 7: Conclusion
7.1. Introduction
British Columbia’s choice to support the forest industry has had mixed results. On
one hand the support likely enabled the investment and expansion of the forest industry into
the northern interior of the province, providing good paying jobs and initial wealth. But, the
choice to support the forest industry has played a significant role in creating the forest
industry we see today, an industry dominated by a few companies. It is easy to criticize
decisions that were made in the past when you have the benefit of hindsight and that was not
my intent. Rather, my intent was to understand the context in which these decisions were
made and some of the repercussions of those decisions. What my research demonstrates is
that the current forest management regime in British Columbia is rooted in institutions that
are driven by ideology. As such, both the present condition of the forest industry and the
contextual condition limit the choices available for forest management in British Columbia
moving forward.
7.2. A Way Forward
What will actually play out post mountain pine beetle in the Prince George Timber
Supply Area remains to be seen. Whatever forest policies the government intends to use to
combat the issues surrounding the dilemma of a reduced timber supply, it would also do well
to remember to pay close attention to the regulatory environment of other competing forest
jurisdictions and the influence of the global economy (Cashore et al., 2006). Meanwhile, with
a declining timber supply post mountain pine beetle, Patriquin, Wellstead and White (2007)
predict that negative impacts to communities will be unevenly distributed so their advice to
government is to tailor the response to each community.

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As discussed in the previous chapter, decisions regarding the forest economy will be
much more difficult to make going forward. Perhaps small incremental changes in the
current institutions will begin with a much smaller timber supply in the post mountain pine
beetle reality. With insufficient timber supply to fuel their ambitions, perhaps companies will
divest themselves from British Columbia as so many companies did in the Coastal forest
region in the latter part of the 1990s (Edenhoffer & Hayter, 2013a; Pearse, 2001). Maybe
then, just like the Coastal forest region (Edenhoffer & Hayter, 2013a), the Interior forest
region will support a much more robust value-added sector.
7.3. Limitations and Future Research
One limitation of my research was the scope of the case study that I chose. Both the
size and complexity of the study area itself made data collection and analyses challenging.
Yet, some analyses like the low stumpage rates from 2007 to 2011 for coniferous non-pine
species would have benefited from a provincial scope. Another limitation was that I chose to
only draw upon public information. My choice to use only public information limited the
type of queries that I could generate for the Harvesting Billing System (HBS) which
consequently constrained my analyses.
There are several topics for future research that I can think of that can stem from this
case study: first, a study of the market pricing system in the Interior region of the province;
second, a study of First Nations involvement in the forest industry post Tsilhqot’in decision
and; third, a study of the ministry responsible for forests. A study of the market pricing
system in the Interior from 2006 until post-mountain pine beetle that looks at the prices
generated from auction and the appraised stumpage charged to licensees. This study would
be difficult to accomplish because researchers would need to have access to government

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databases so that timber harvest activity could be linked to the corresponding information
supplied for the appraisal of that timber. In light of the Tsilhqot’in decision, the government
has committed itself to giving more timber rights to First Nations. It would be interesting to
see what the outcome of this decision would be and what the outcomes are of business to
business relationships that are formed between forest companies and First Nations. Finally, it
would be fascinating to explore how the ministry responsible for forests has changed
throughout time, particularly since 2001 and how these changes have impacted forest
management in British Columbia.
In closing, I am leaving the reader with an excerpt from a poet who explored his
own life experiences growing up in the forest resource dependent town of Quesnel, British
Columbia. In reading his personal account, I could see him wrestling with his morality as he
struggled to come to grips with the economy of the forest sector and his concern for the
impact that this economy has had on both human and wild environments. The story he shared
spoke volumes to the collision that occurs between the exploitation of a resource, and the
natural ecosystem and raises the question of how we as humans will survive if we are the
cause of our own undoing. He is not alone in this quandary, and his words speak to me.

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stage 6
the working forest
in the way dust collects on the bark of fallen trees
in the way lending seems to outweigh return
the swing of economies
to extract and make ready
waiting for the language
to fall, to be weighed out
caulks and leather hands on chain and teeth
diesel smoke climbs and steel cables skid
prescription and outcome
are of different realities
and the contexts move
politics of the nonhuman
washed out by the sound of economics
stumpage left lingering
as subtle violence
and they don’t get time at the bargaining table
when our wants out-weigh our needs
consumption becomes a marker of status
the nexus of parts
as we work towards some tragic end
non-reciprocal relationships emerge
and debt is at the tip of every tongue
on paper it suggests otherwise
but still the forest remains
unemployed
(Foster, 2012, p.77).

135

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152

Appendix I – UNBC Research Ethics Board Approval

153

Appendix II – Event Time Line 1997 to 2011
Year

Local Mill Opening/Closing *

1997
1998

Closure - Northwood P.G. Wood (Prince George)

1999

Closure - Canfor Netherlands (Prince George)

Mountain Pine Beetle (MPB)
Epidemic **

2000
2001

MPB - All Districts

2002

 MPB substantial Vanderhoof
 First AAC uplift to address
MPBŧ
MPB substantial Prince George

2003

 Closure - Canfor Upper Fraser (Prince George)
 Upgrade - Canfor (Prince George)

2004
2005

 MPB over run Vanderhoof
 Second AAC uplift to address
MPBŧ
Upgrade - Canfor Plateau (Vanderhoof)

2006

2009
2010
2011

Asian Economic Crisis (Hoberg, 2010)

AAC partition for Fort St. James

Forest Act - Community
Forest Agreements
Forest Practices Code Results Pilots
Nisga'a Treaty

SLA counter veiling Duties

BCTS created 20% volume take Bill 29 - BC Economic
back
Revitalization Plan

New Softwood Lumber Agreement (Zhang,
2007)

MPB Action Plan Update

US Housing Starts Peak (Hoberg, 2010)

MPB Action Plan 2005-2010

US Housing Crisis (Hoberg, 2010)

ŧ

Jobs & Timber Accord

Legislation ****

Protected Areas Strategy
MPB Action Plan

High Canadian Dollar (Hoberg, 2010)
 Closure - Winton Global Bear Lake (Prince
George)
 Closure - Canfor Plywood Plant (burns) (Prince
George)
 Closure - Pope & Talbot (Fort St. James)
 Closure - Stuart Lake Lumber (Fort St. James)
Open - Conifex Mill (Fort St. James)
Closure - Canfor Clear Lake (Prince George)
Closure - Canfor Rustad (Prince George)

Forest Policies ****

Lumber Prices Decline
Expiry of Softwood Lumber Agreement
(SLA) (Zhang, 2007)
SLA counter veiling Duties

MPB substantial Fort St. James

2007
2008

Lumber Market Impacts ***

New Markets Accessed to China
Lumber prices rise

Forest and Range Practices
Act

 Interior Log Grades
changed
 Market Pricing established
in the Interior
Forestry Roundtable
Established

Regulations amended to
include use of fibre for
bioenergy

Cruise Based Appraisals

* Source: Prince George Citizen 1999-2011 using UNBC Library Electronic Database
** Source: BC Forest Health Survey - Pest Overview of Mountain Pine Beetle (1999-2007) GIS Layers available through the Provincial Land and Resources Data Warehouse
*** Source: Ministry of Forests, Lands and Natural Resource Operations website unless otherwise noted, http:www.gov.bc.ca/for
**** Source: Ministry of Forests, Lands and Natural Resource Operations website, http://www.gov.bc.ca/for
ŧ Source: Ministry of Forests, Lands and Natural Resource Operations website, https://www.for.gov.bc.ca/hts/tsa/tsa24/index.htm

154

Appendix III – Interview Guide
Preamble: I want to investigate how forest corporations have responded to the forest policy
changes made by government in 2003 which were designed to revitalize the forest industry,
and how this may have subsequently impacted the forest industry.
I am currently employed with the Ministry of Forests, Lands and Natural Resource
Operations, however, this research is in no way related to the duties of my employment, nor
am I representing my employer. I am conducting this research independently and want to
assure you that what you say during this interview will be kept confidential and that your
anonymity will be protected.
Before we begin the questions about the forest policy changes, I would like to find out more
about you and the role you have played in the forest industry. I myself have worked in
forestry for almost twenty years both in the private and public sectors.
The personal information that you provide in Question 1 will be used by me for analysis
purposes only and will not be documented so as to reveal your identity, rather it will allow
me to establish your experience and background for the questions that will follow.
1.

How long have you been involved in forestry?


What sorts of roles have you played?



How long have you worked in the Prince George Timber Supply Area?



What was your position from 2001 to 2003?



What is your position now?

Preamble: The Forest (Revitalization) Amendment Act 2003 was aimed at revitalizing the
forest industry. The changes made to legislation enabled forest corporations to: consolidate
and subdivide forest licenses, transfer agreements, and determine the number and location of
timber processing facilities within British Columbia.
2.
ended up

Were you directly or indirectly involved in the formation of the policies that
in the Forest (Revitalization) Amendment Act 2003?


Were you in favour of these changes?
o Why or why not?

3.

In your opinion, what precipitated these changes to the legislation?

155



What role, if any, do you think that globalization has played?



Do you think that there was pressure from the British Columbia forest
industry or other governments to make these changes?
o In other words, do you think that the Liberal government had much
choice in the direction that they took with the legislation?

CHECK IN POINT
4.

Looking back over the last decade, do you think that these changes have influenced the
way in which the forest industry has evolved?
If yes…
 Can you give me some specific examples?
Data I have already collected shows that there has been a decrease in the number of
lumber manufacturing facilities within the PGTSA in the last 15 years, and that this
manufacturing has been concentrated within the Prince George District. Further, BC
employment statistics show a dramatic decline in both the forestry/logging sector and
the wood product manufacturing sector over the past 15 years.


Given this data, can you comment on what makes the present forest industry
stronger?

If no…

o How do you think this translates for communities whose economies are
reliant upon the forest industry?



Can you elaborate on why you think the changes were not helpful to the forest
industry?



Why do you think that this attempt to strengthen the forest industry was not
successful?
o What would have had to be different to make it successful?

Data I have already collected shows that there has been a decrease in the number of
lumber manufacturing facilities within the PGTSA in the last 15 years, and that this
manufacturing has been concentrated within the Prince George District. Further, BC

156

employment statistics show a dramatic decline in both the forestry/logging sector and
the wood product manufacturing sector over the past 15 years.


Given this data, can you comment on what makes the present forest industry
stronger?
o How do you think this translates for communities whose economies are
reliant upon the forest industry?

CHECK IN POINT
5.

Have you witnessed any other changes over the past fifteen years in the forest industry
that you believe are connected to these legislative changes?

Preamble: Despite that Prince George Timber Supply Area is one of the more diverse
Timber Supply Areas in the central interior, it too is facing an imminent reduction to its
Annual Allowable Cut because of the devastation caused by the mountain pine beetle and
subsequent salvage logging. In 2012 a Special Committee on Timber Supply was struck in
response to the Auditor General’s report which criticized the stewardship of timber in BC.
6.

In your opinion, do you think that stewardship of the timber resource has been
compromised in any way by these legislative changes?


Can you elaborate?

CHECK IN POINT
Preamble: Following the report released by the Special Committee on Timber Supply, the
government tried to introduce legislation in the spring of 2013 that would enable volume
based Forest Licences to be converted to area based Tree Farm Licences.
7.
make

8.

In your opinion, what do you think motivated the government to attempt to
these changes?


Do you support the idea of converting Forest Licences to Tree Farm Licences?
o Why or why not?



Who would benefit from a change like this?
o Industry? Community? Government?

Moving forward, what sort of changes do you think need to be made to forest policy
to ensure the survival of the forest industry in British Columbia?

157

Preamble: In closing, I would like to ask you a few more questions to ensure I have been
thorough.
9.

Is there anything else that you would like to tell me about that we haven’t already
covered?

10.

Is there anything that you would like to ask me?

11.

Are there other individuals who are knowledgeable in this subject that you think I
should interview?

Thank you for taking the time to do this interview with me and participate in this research. I
will forward you a summary of the interview when I have completed the transcription so that
you can review and edit anything that was said. Please don’t hesitate to contact me at any
time if you have any questions or concerns about the interview, or the research process.

158

Appendix IV – Information and Consent Form
Research Topic: Prosperity or Crisis? Examining the Efficacy of British Columbia’s Forest
Policy Choices to Support the Forest Industry
Disclosure: I am currently employed with the Ministry of Forests, Lands and Natural
Resource Operations, however, this research is in no way related to the duties of my
employment, nor am I representing my employer. I am conducting this research
independently.
Purpose: This research will examine the response by forest corporations to policy changes
brought in by the Forest (Revitalization) Amendment Act 2003, which were aimed at
revitalizing the forest industry. The changes made to legislation enabled forest corporations
to, consolidate and subdivide forest licenses, transfer agreements, and determine the number
and location of timber processing facilities within British Columbia. While these changes
were designed to strengthen the forest industry by providing greater flexibility, and in turn
benefit the citizens of British Columbia, these benefits have yet to be determined.
How You Are Being Asked to Participate: You are being asked to voluntarily participate
in an interview with the researcher, Tammy Baerg. You are not being asked to represent your
employer, rather you are being asked to express your own opinions based on your own
observations. This will be a semi-structured interview that will be recorded using a digital
recording device and will last approximately 45 minutes. In this interview you will be asked
to answer several questions regarding the specific forest policy changes made by the Forest
(Revitalization) Amendment Act in 2003 that were designed to assist the forest industry. You
will also be asked your opinion as to what you have observed over time as a result of these
changes.
How You Were Chosen: You were identified either by the researcher, Tammy Baerg, or by
other local people, as someone with considerable knowledge of the Forest (Revitalization)
Amendment Act 2003, as well as either the events that led up to it, or the events that followed
as a result, or both.
Anonymity and Confidentiality: Neither your name, or any other information that may
identify you, will be used in any of the material that is reported. As well, the information that
you provide in this interview will be kept in strict confidence by the researcher. All written
records will be kept in a locked cabinet in a room at the researcher’s residence that is only
accessible to the researcher. All electronic records of written materials will be stored on the
password protected computer that belongs to the researcher and it will be kept in a locked
research space at UNBC. As this research is part of completing a UNBC Master’s degree,
the final thesis will be available to the public in the UNBC library. All information pertaining
to this interview will be kept for two years after the publication of the researcher’s thesis, at
which time they will be destroyed.
159

Potential Risks and Benefits: This project has been reviewed by the UNBC Research
Ethics Board. As the sole researcher of this project, I have not identified any risks to your
participation, nor has my supervisor. I believe that your contribution will provide a richer
explanation to the research questions being asked and could very well serve to inform not
only future forest policy, but future policies surrounding other natural resources.
Voluntary Participation: Your participation in this interview process is entirely voluntary
and as such you have the right to discontinue the process at any time. You may also choose
not to answer particular questions or may change your mind about how you answered. The
interview will be audio recorded and the researcher will provide you with a summary for you
to review. You will then have two weeks to provide the researcher with any changes that you
want made. You have the right to end the interview at any time or withdraw from
participating. Should you withdraw your participation you also may request that any
information that you have provided be destroyed.
Complaints: If you have any complaints or concerns regarding your rights as a participant
in this research please contact the UNBC Office of Research at (250) 960-6735 or by e-mail
at reb@unbc.ca.
Research Results: Please advise the researcher if you would like a copy of the completed
thesis and one will be provided to you. Also, should you have any questions regarding the
research results please contact the researcher, Tammy Baerg, or her supervisor, Tracy
Summerville.
Contact Information:
Researcher - Tammy Baerg, phone 778-349-4907, email baergt@unbc.ca
Supervisor - Tracy Summerville, phone 250-960-6637, email Tracy.Summerville@unbc.ca

I have read the above description of the research and I understand the conditions of my
participation. My signature indicates that I agree to participate in an interview.

___________________
_____________________
__________________
Name (please print)

Signature
Date

160

Appendix V – Template Analysis Themes/Questions
Theme 1: The Legislative Changes to Forest Policy in 2003 – Why did it happen?
What precipitated the changes?
What were the factors of influence?
Were there external pressures on government to change?

Theme 2: The Evolution of the Forest Industry – What were some of the consequences?
Did the changes influence the evolution, if so how?
Was this a good or bad thing and why?
Theme 3: The Centralization and Capitalization of Manufacturing – What are the
implications?
What makes the industry stronger?
What does this mean for forest dependent communities?
Theme 4: Other Changes in the Industry – What other changes may have been an influence?
What other changes have been observed over the last 15 years?
Theme 5: Timber Stewardship – Did the policy changes influence behaviour by licensees?
Has stewardship of the resource been compromised?
Theme 6: The Conversion of Forest Licences to Tree Farm Licences – Recently proposed
policy
What motivated the proposal?
Who would benefit from a change like this?
Theme 7: Future Policy Needs – What are changes that need to be promoted for the future?
What policies need to be pursued to ensure the survival of the forest industry?

161

Appendix VI – Content Analysis and Theme Development
Subtheme
Allowable Annual Cut
Area vs. Volume Tenure
Asian Markets
BC Timber Sales
Benefits
Bottom Line
Business
Business Cycle
Business Decision
Capital Investment
Carbon
Centralization
Choice
Community
Community Forests
Compensation
Competition
Consolidations and Transfers
Control by Community
Control by Government
Control by Industry
Cooperation
Crown Revenue
Dimensional Lumber
Diversity
Economic Drivers
Economic Efficiency
Economy
Employment
First Nations Land Title
First Nations Participation
Forest Industry
Forest Licence
Forest Service
Global Marketplace
Government

Subtheme Indicators
AAC, Allowable Annual Cut
Area based, volume based
China, Asia
BC Timber Sales, BCTS, Market Pricing System
benefit(s), beneficiary, beneficial
bottom line, cost, reduce, reduce cost, profit, revenue
business(es)
business cycle, cycle, cyclical, recession, market
downturn, stability, stabilize, unstable, destabilize
business decision, rationalize, rationalization
capital, mechanization, technology, technological,
invest, investments, upgrades
carbon
centralization, centralize
choice
community, communities, First Nation communities
community forest, CFA
compensation, compensate
compete, competition, competitive
consolidation(s), consolidate, transfer(s),
amalgamate, amalgamation(s)
control(s)
control(s), cut control
control(s)
cooperation, cooperate, working together, share,
partnership, partner
stumpage, revenue
board, lumber, commodity, commodity lumber,
commodity mill, product
diversity, diverse
supply, demand, trade-off(s), price
efficiency, economic, economically
economy
job(s), employment, unemployment
Tsilhquo'tin decision, William’s decision, First
Nations
First Nations
industry, forest sector, forest industry
Forest Licence, licence,
Forest Service, Ministry
global, globalization, globe
Crown, government

162

Subtheme
Green Timber
Harvesting
Higher End Products
Ideology
Independent Mills
Investor
Labour Force
Land Use Planning
Liability
Liberal Party
Log
Log Market
Logistics
Lumber Manufacturing
Major Licensees
Markets
Mid-term Timber Supply
Mountain Pine Beetle
NDP/Social Credit Parties
Operating Area
Plans and Planning
Policy
Public
Relationship
Residual Products
Salvage
Sawmill
Shareholder
Silviculture
Social Engineering
Social Licence
Specific Policy
Stakeholder
Stewardship
Tenure Reform
The Land Base

Subtheme Indicators
green timber, green wood
cut, cutting, log, logging, harvest, harvesting,
plywood, peeler, glulam
ideology, belief, philosophy, ideologically
family owned mills, independent mills
investor, investment(s)
labour, work force, worker(s), employee(s),
employer(s),skills, skilled, knowledge, logger(s),
logging contractor(s)
LRMP, land use plan, land use planning
liability, liabilities
Liberals,
log
log market
logistics
cut, mill, manufacture, milled, milling, volume,
product(s), producer, miller, production, produce
licensee(s), majors, company, companies
market(s), trade
mid-term timber supply, mid-term
mountain pine beetle, beetle, pine beetle
NDP, Social Credit
operating area(s)
plan(s), strategy, strategic,
legislation, legislative, bill, regulation, regulatory,
regulate, policy
public, tax payer(s)
relationship(s)
pellet, green energy, bioenergy, pulp, pulp mill(s),
salvage
mill(s)/ sawmill(s)
shareholder, corporation, publically traded
silviculture, timber production, invest, investment(s),
stewardship
social engineer(ing)/licence/net/choice/contract
appurtenancy, social
engineer/licence/net/choice/contract
Forest Act, FRPA, Results-based, Code, Forest
Practices Code
stakeholder
stewardship, sustainable
tenure reform
Land base, landscape

163

Subtheme

Subtheme Indicators

State of the Current Industry

adaptive, adapt, flexible, flexibility, strong, stronger,
viable, viability, efficient, efficiency, effective
AAC, cut, quota, allocation
timber profile
rights, security, secure, certainty, uncertainty, tenure
timber, supply, volume, fibre, wood
transport, railway, rail, rail line, truck, trucking,
shipping
TFL, Tree Farm Licence, area based
American, States, United States, U.S., Softwood
Lumber Agreement/Disagreement
value, value-added, niche market(s), custom,
customer, product(s)
Woodlot

Timber Allocation
Timber Profile
Timber Rights
Timber Supply
Transportation
Tree Farm Licences
United States Market
Value-added Sector
Woodlot Licences

Subtheme
Allowable Annual Cut
Area vs. Volume Tenure
Asian Markets
BC Timber Sales
Benefits
Bottom Line
Business
Business Cycle
Business Decision
Capital Investment
Carbon
Centralization
Choice
Community
Community Forests
Compensation
Competition
Consolidations and
Transfersby Community
Control
Control by Government
Control by Industry
Cooperation
Crown Revenue
Dimensional Lumber
Diversity

Assigned Value
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
General
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific

Interview Question
Direct
Direct
Indirect
Indirect
Direct
Indirect
Direct
Indirect
Direct
Direct
Indirect
Indirect
Direct
Direct
Direct
Indirect
Direct
Direct
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect

164

Subtheme

Assigned Value

Interview Question

Economic Drivers
Economic Efficiency
Economy
Employment
First Nations Land Title
First Nations Participation
Forest Industry
Forest Licence
Forest Service
Global Marketplace
Government
Green Timber
Harvesting
Higher End Products
Ideology
Independent Mills
Investor
Labour Force
Land Use Planning
Liability
Liberal Party
Log
Log Market
Logistics
Lumber Manufacturing
Major Licensees
Markets
Mid-term Timber Supply
Mountain Pine Beetle
NDP/Social Credit Parties
Operating Area
Plans and Planning
Policy
Public
Relationship
Residual Products
Salvage
Sawmill
Shareholder
Silviculture
Social Engineering
Social Licence
Specific Policy

General
Specific
Specific
Specific
Specific
Specific
General
Specific
General
Specific
General
Specific
General
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
General
General
General
Specific
Specific
Specific
Specific
General
General
General
Specific
Specific
Specific
General
Specific
Specific
Specific
Specific
General

Indirect
Direct
Indirect
Direct
Direct
Direct
Direct
Direct
Indirect
Direct
Direct
Direct
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Indirect
Direct
Indirect
Indirect
Indirect
Indirect
Direct
Indirect
Direct
Direct
Indirect
Indirect
Indirect
Direct
Indirect
Indirect
Indirect
Direct
Direct
Indirect
Direct
Indirect
Direct
Direct

165

Subtheme
Stakeholder
Stewardship
Tenure Reform
The Land Base
State of the Current Industry
Timber Allocation
Timber Profile
Timber Rights
Timber Supply
Transportation
Tree Farm Licences
United States Market
Value-added Sector
Woodlot Licences

Assigned Value
Specific
Specific
Specific
General
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific
Specific

Theme
Factors that Influence Business Decisions
The Competitive Log Market
The Disposition of Timber Rights
The Lumber Manufacturing Business
The British Columbia Economy
Social Engineering
The Social Contract
Control

Interview Question
Indirect
Direct
Indirect
Indirect
Direct
Indirect
Indirect
Indirect
Direct
Indirect
Direct
Direct
Indirect
Indirect
Absolute Number of
Occurrences of Subtheme
Indicators, All Groups
202
170
129
117
87
69
43
22

Theme 12: The British Columbia Economy
Subtheme
Group 1
Group 2
Industry
Government
Business Cycle
30%
30%
Economy

32%

35%

Theme 13: Social Engineering
Group 1
Group 2
Industry
Government
NDP/Social Credit Parties
50%
17%
Subtheme

Group 3
Other
40%
32%

Group 3
Other
33%

Social Engineering

28%

44%

28%

Ideology

17%

50%

33%

166

Subtheme
Land Use Planning

Theme 14: The Social Contract
Group 1
Group 2
Industry
Government
4%
46%

Group 3
Other
50%

Stakeholder

0%

13%

88%

Woodlot Licences

22%

78%

0%

Subtheme
Control by Community

Theme 15: Control
Group 1
Group 2
Industry
Government
20%
20%

Group 3
Other
60%

Control by Government

86%

14%

0%

Control by Industry

0%

33%

67%

Sub-theme
Asian Markets

No Emergent Theme
Group 1
Group 2
Industry
Government
19%
57%

Group 3
Other
24%

Cooperation

32%

47%

21%

Diversity

37%

42%

21%

Independent

32%

21%

47%

Relationship

58%

25%

17%

Investor

67%

22%

11%

Liability

0%

75%

25%

Carbon

50%

0%

50%

167