Gordon Hamilton, Vancouver Sun, August 12, 2006

Faller Joe Corlazzoli has been logging in Clayoquot Sound since the days when MacMillan Bloedel clearcut a million cubic metres of wood a year to feed its Vancouver Island sawmills.

But these days, the work of Corlazzoli and the crew of fallers he works with is almost invisible as they cut timber for the company that inherited MB’s timber tenure, 100-per-cent first nations-owned Iisaak Forest Resources.

That’s the way it’s supposed to be, Corlazzoli said in an interview from his home in nearby Ucluelet. The fallers are part of Clayoquot Sound’s grand experiment in ecosystem-based forestry, the new direction in logging that had its beginnings in Clayoquot Sound six years ago when Iisaak cut its first tree. Since then, they have been harvesting minuscule volumes of timber.

But that began to change in 2005, when they harvested 85,000 cubic metres — 2,500 truckloads of logs. This year, they expect to hit 100,000 cubic metres using ecosystem-based forest management.

After a decade of silence in the rainforests of Clayoquot Sound, logging is back, igniting a new debate over how much timber can be removed without harming the ecosystem, and what benefits will it bring to the sound’s communities.

Further, as the volume of timber has gone up, Iisaak’s fortunes have not followed. The company that began seven years ago with so much promise is facing a financial crisis.

And finally, instead of being marketed as a unique, eco-certified product from British Columbia’s first all-native forest tenure, Iisaak timber is being sold on the open market to conventional log buyers where it is mixed in with logs that, for all the buyers know, could have come from clearcuts.

Corlazzoli was the faller who cut that first tree on a clear August morning in 2000 after Ahousaht singer Percy Campbell had prayed before it. As the cedar hit the ground, assembled environmental leaders broke into applause. It marked the end of the Clayoquot environmental wars, and what was supposed to be the beginning of new prosperity for first nations who, for the first time, had control over a significant piece of the forest wealth within their territory.

Iisaak was founded in 1999 as a joint venture between MacMillan Bloedel and the Clayoquot first nations as a solution to the environmental wars of the 1990s. Environmental groups played a large role in the creation of this first native-controlled forest tenure in B.C. In 2005, when MB successor company Weyerhaeuser was sold to Brookfield Asset Management, Clayoquot first nations bought Weyerhaeuser’s share in Iisaak, giving them 100-per-cent ownership.

Iisaak — named after the Nuu-chah-nulth word for "respect" — is a unique and innovative response to the clash of values between industrial forestry, first nations and a society that views the West Coast rainforest as a global treasure. In the seven years since it was founded, it has struggled to extract economic wealth through a harvesting model that places more value on how much of the forest the loggers leave rather than what they take.

But just as it was starting up, it was hit with the same problems that have afflicted all coastal forest companies for the past five years — poor markets, softwood lumber duties and a soaring Canadian dollar. Only Iisaak has had it harder. The learning curve to redesign forestry has been costly, as have Iisaak’s stricter logging standards.

It comes as no surprise that Iisaak is facing a crisis, say industry observers. To have survived seven years in a market that has crippled so much of the coastal forest industry is an accomplishment in itself.

But now Iisaak — and the first nations who own it — face tough choices: If Iisaak is to be more than just another logging company selling timber to the highest bidder, it needs revitalizing. It needs an injection of capital. It needs more access to timber, or it needs to extract more value from the timber it already harvests. And it needs more access to markets for its certified wood, which right now is being sold to log buyers who mix it in with conventionally harvested timber.

To restore the ideals and the business model of eco-logging, the five first nations — the Tla-o-qui-aht, Ahousaht, Hesquiaht Tolquaht and Ucluelet — have approved a restructuring of the company under the management of Ecotrust Canada, an environmental group with a record for business acumen and raising capital.

Ecotrust’s plan will mark the first time a forest company has been restructured not just to restore financial health but to put it on a sound environmental footing and integrate it with the communities where it operates.

It’s a tall order.

"To some degree, this calls the bluff on the environmental community as to whether this can even be done," said Ecotrust executive director Ian Gill. "We appreciate the risk that’s involved, but we believe in the company. We believe in sustainable forestry. And we believe in the community and their rights to have jobs and income.

"But we also believe strongly that the environmental values of Clayoquot Sound are not just world-renowned, but of international importance.

"Managing for all that will be tough sledding, for sure. But the alternative is saying industrial forestry wins, and I think it just doesn’t win for a number of reasons that we are seeing all over British Columbia. So that’s just not acceptable. It’s not acceptable in Clayoquot Sound, and it’s not acceptable anywhere. So we have to punch through that."

Ecotrust will be bringing in one of the province’s most credible ecosystem-based logging operators, Triumph Timber, which has a record for combining economic, social and environmental values on its timber tenure on the province’s north coast.

Further, after smoothing over a conflict over where logging should occur, Clayoquot first nations have allied with environmentalists once again — this time to call on government for more indigenous control and more funding for alternative economic development in the sound.

Agriculture and Lands Minister Pat Bell said Friday that the province endorses the decision-making model established in Clayoquot Sound. And there are at least two pools of development funds the region should be able to tap: the $22-million Coast Sustainability Trust and the $50-million Northern Island Trust.

"Although there haven’t been any specific [requests] yet, there have been some general discussions," he said of prospects for development funds.

Logging is going to be an integral part of Clayoquot Sound again, said Joseph Tom, chief councillor of the Hesquiaht. But it is going to be balanced with tourism and community needs. The indigenous ideal Iisaak is expected to live up to, he said, is getting needed resources from the forest without harming it.

"Iisaak will do forestry as long as there is a balance of nature so everything else is surviving: the first nations people and the local communities.

"Not everyone is going to log, but if you put eco-tourism there as well, you can see the pristine forests that are left behind and you will also see what logging actually does — from clearcut to now — and how it has improved. And there is always room for more improvement."

Whether that means logging Clayoquot Sound’s four pristine watersheds is still an open question. As the realities of operating a logging business on the B.C. coast sink in, the five Clayoquot first nations who own Iisaak are, for the first time, considering expanding logging into the four unprotected pristine valleys that spill down from Vancouver Island’s mountain spine into Clayoquot Sound. The are the Sydney River, Ursus River, Bulson Creek and Clayoquot River. Environmentalists are opposed to introducing logging in them.

Logging has not been approved, but new watershed management plans approved in late July open up the possibility. To carry the overhead associated with a full-scale logging company, Iisaak’s business plan calls for an annual harvest of 100,000 cubic metres of timber a year. That volume can only be sustained if Iisaak has more land on which to practice its innovative forest practices. There are two options: Purchase the other licence in Clayoquot Sound — Interfor’s Tree Farm Licence, which is for sale — or tap into the pristine valleys.

There is a third option, but it still remains largely unproven: Develop a marketing strategy for Iisaak timber that will get it into a higher end-use stream. Iisaak has tried it before: Hollywood movie producer George Lucas wanted certified Clayoquot Sound cedar for a home he was having built in Northern California. Iisaak harvested the timber and had it milled and finished.

The product was outstanding. But it cost Iisaak far more to produce than it made on the sale. It was great publicity, but a financial disaster for the struggling company. 

Mike Vitt, Ecotrust’s forestry program manager, said he is convinced Clayoquot wood can be sold for higher values than it currently is. Not just because it is eco-certified, but because it is part of a total package that includes customer service. The obvious example, he said, is to channel Clayoquot wood into the drive within the construction industry for green-certified building products. 

"It’s about a preferred relationship with customers. You can use certification to gain access into places, markets and customers where you may be technically selling the same product at the same price, but the advantage is that you can have a preferred access to a higher-valued market. For example, instead of selling logs to someone who cuts it into dimension lumber, we can actually target a particular set of higher-valued products for a particular customer who is looking for Forest Stewardship Council-certified wood." 

In the meantime, Corlazzoli and the other loggers employed by Iisaak have been working sporadically, out of sight and out of mind to the tens of thousands of tourists who visit Clayoquot Sound every year. They are still committed to ecosystem-based management, an attempt to balance economic values with ecological, community values. 

Twenty km before travellers reach Pacific Rim National Park, they pass by Corlazzoli’s latest worksite off Highway 4. But they don’t even know it’s there. It’s hidden behind the hills to ensure that high-priority tourist values are not affected. 

Corlazzoli has even logged the slopes of the Catface Mountain Range, across the sound from the Tofino waterfront. 

"I’ve been cutting places right across from Tofino that you can’t even see. I’ve been doing 70-per-cent retention," he said, referring to the ratio of trees left behind. "You wouldn’t see it from Tofino no matter how hard you looked." 

Corlazzoli said people shouldn’t be shocked that logging is taking place in Clayoquot Sound. 

"Iisaak is a logging company," he said. "They gotta do some logging, otherwise they are not going to be around." 

Sun Forestry Reporter 

ghamilton@png.canwest.com 

© The Vancouver Sun 2006