Recession and the Plum Creek Proposal

Posted: 23/01/2008 in Uncategorized
Tags: , , , , , ,
I wrote Tuesday about Plum Creek and the relation of real estate and the road to recession the country is going through. And I also made mention of the global implications involved in transactions here in Maine being affected by the global marketplace. The US markets were closed Monday because of MLK day, but all of the world markets, with the exception of Sri Lanka closed down, with some foreign investors in a near panic over the losses.

Last night, Tuesday evening, the major US markets opened down, and while trying to make a comeback also closed down. The biggest reasons for the decline was based on the real estate mortgage market. Property values have started to decline in most areas of the country, and many lenders are stuck with little or no cash reserves on hand in the wake of the rash of nonpayment by many who cannot afford to pay for the money they borrowed.

But how does this affect the Plum Creek proposal here in Maine? One would think there should be no concern, however, Plum Creek’s stock is falling, as are most other stocks in the real estate sector.

This is their chart as of 01-21-2008;

Plum Creek’s stock chart provided by info@askStockGuru.com
http://www.askstockguru.com/cgi-bin/s?s=PCL&dat=20080121.

What quesion this brings to mind is what Plum Creek will do to cope with the downturn. There are several alternatives available, but there are probably only a couple of courses of action they will take, based on their history. My guess would be that they will probably sell off land to make up the shortage. Will they sell Maine land, or some other property? Who knows? But of more importance is the relationship between Plum Creek and The Nature Conservancy.

Many of the issues The Nature Conservancy champions are worth supporting, but over the last few years, they have changed their direction from being a conservation and species preservation into a land management organization. One of the problems people seem to encountering is the fact that many properties they purchase outright, or control through easements are sold to other people or organizations that may not have the best interests of the area in mind.

A blogger, The Fish Geek http://tiny.cc/WHBgk. had an article regarding this very issue this week. Here are a couple of highlights from the post concerning the Blackfoot project in Montana……

The easements are a part of The Nature Conservancy’s Blackfoot Community Project, a friendly name for a project that has garnered significant support from agencies and some members of the public, but may or may not be in the best interest of the ‘community’……

I like a lot of what The Nature Conservancy has done in buying up large parcels of land and maintaining them, to a certain extent, for traditional use. However, it seems as though a lot of what they do in certain areas may not be beneficial for the hunter or fisherman…..

About half of the former Plum Creek Timber land purchased by The Nature Conservancy has been sold to the U.S. Forest Service…….

The other half will be sold to various private individuals and corporations (with development restrictions), but TNC has not indicated that there will be any stipulations requiring public access to these lands……maybe some of these lands that were once very popular hunting and fishing grounds will now be off limits……

While the need for conservation easements to protect wildlife in the area is significant, it seems that the best situation was one where a large timberland owner was providing an important tax base for local communities, providing jobs, and keeping access open to the public with minimal development……

Private industrial timberlands have long provided a win-win situation for many local communities, but maybe moves like this one are signs that times are changing and we need to take measures to preserve public access while maintaining land ownership patterns that make the most sense….

It isn’t just in Montana that this is happening. From California to Maine, The Nature Conservancy has been gobbling up land and easements, and selling off ones they deem less valuable than others to provide funding for lands they have a greater desire for. What guarantee do we have that unscrupulous developers won’t snatch up this property if it becomes a distressed possession, and a quick cash need arises by Plum Creek? I haven’t seen any in all of the information that I have collected.

In fact, there are ample opportunities for this scenario to happen as provided for in a draft copy of the easement. 100,000 acres can be subdivided according to the document, and there is no guarantee that you or I will be able to access this land being ‘protected.’

Wikipedia has this to say about them…….

Too close to business. Some environmental groups and activists view “big business” and “environmentalism” as natural antagonists, and find The Nature Conservancy’s collaboration with corporations inappropriate. The Conservancy argues that since corporations have such a significant impact on the environment, they must be engaged in finding ways to do business that do not harm the environment. Moreover, they provide significant resources. There is a traditional rule at the Conservancy “It’s tainted money, but it taint enough.”<p>

Questionable resale. There have been instances of The Nature Conservancy obtaining land and reselling it at a profit, sometimes to supporters, who have then made use of it in ways not perceived by all as being sufficiently environmentally friendly. The rationale for the resale has been that the profit allows The Nature Conservancy to increase its preservation of more important locations.<p>

Hands Off our Land. Some ranchers, outdoorsmen and other recreational enthusiasts question if the conservation of land, animal and plant life spells the end of responsible farming, ranching and outdoor recreation in Nature Conservancy purchased and protected lands.<p>

There’s a lot at stake here in light of the economic state of Maine, and the direction we are going. Are we looking at all of the potential ramifications regarding this issue? The environmental concerns are just a portion of the issue as a whole. We need to protect Maine’s economic future as well.

With the news looking more bleak every day lately, now is not the time to be grasping at straws. There are an increasing number of concerns over this proposal. In reading over a 40 page draft of the conservation easement I need to ask some questions in light of other developments. But more on that next time.
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