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Back To the Drawing Board: Homes for acres deal at Skyline hits the wall 

A proposed deal that has divided conservationists about the best way to preserve a large chunk of undeveloped forest land just west of Bend has been shelved by the property owner as it weighs its options.

Fidelity National Timber Investments, which owns the 33,000-acre tree farm known as Skyline Forest had planned to ask the Oregon legislature to sign off on an unprecedented plan that would have allowed the company to essentially donate most of the forest to the Deschutes Basin Land Trust in exchange for permission to build several thousand homes on the remaining acres between Bend and Sisters. But at this point, the company has essentially pulled the plug on the proposal because of state planning hurdles and a lack of local support for the deal.


"Nobody has pronounced it dead. But you don't have to be that perceptive to read the tea leaves," said Brad Chalfant, executive director of the Land Trust.

At this point, the Land Trust, which has been working for more than a decade to preserve the forest in the face of development pressures, is reverting back to its original strategy of working to purchase as much of the forest as it can afford - provided Fidelity is willing to sell, Chalfant said. That would likely mean some kind of local capital campaign, as well as a mix of state and federal grants and some revenue bonds to be paid back with future timber receipts.

Chalfant said the Land Trust remains in steady contact with Fidelity, which owns about 270,000 acres of former Crown Pacific timberland in Oregon. The company has publicly embraced the idea of preserving Skyline as a "working" community forest - a goal that the Land Trust has been pursuing for several years. But not everyone agreed that trading development rights and paving the way for several thousand homes in the forest was the best strategy.

"I'm happy, frankly, that it's not on the table anymore," said Erik Kancler, executive director at Central Oregon Landwatch, a local environmental watchdog group that had opposed the scope of the residential building plan.

"We've always been adamant that it would be very difficult for them to come up with any development on that land under current laws, if someone was interested in enforcing those laws," he said.

It's unclear whether the community at large would have supported the plan, which never got a thorough public airing. Earlier this year, Fidelity representatives said they would schedule a series of community meetings to help familiarize the public with their proposal before the legislative session. But that never happened. Instead Fidelity got pulled into an overarching discussion with state regulators about the future of all its timber holdings with state forest and planning officials. Among other things, the state was trying to broker a purchase of roughly 140,000 acres of timberlands from Fidelity near Gilchrist. The result, said Chalfant, is that the clock kept ticking on Skyline and Fidelity missed its window of opportunity to build a case to the community.

"I don't know whether what Fidelity was proposing is something that the community could have bought off on, and we'll never know because we never got to that point in the dialogue," he said.

Without community support, there was no way to push the project in the legislature, said Chalfant.

"You can't just show up in Salem on January 1 and hope to get a bill through...They've missed their window for doing public outreach, which means they've missed their window for legislation," he said.

Kancler said he is skeptical that the community would have embraced Fidelity's proposal.

"The Land Trust and Landwatch were somewhat divergent on this," Kancler said. "I feel that Fidelity was asking for too much, and frankly, I don't think the community was going to get behind it."

But with the land for homes deal dead, it opens the possibility that Fidelity will try to break the 33,000-acre forest into small pieces and sell them off. If that happens, it could be difficult to protect the forest, said Chalfant. But at this point, Chalfant said the Land Trust and Fidelity are still talking, and he remains optimistic that the two sides can come up with some sort of mutually agreeable proposal. One possibility is that Fidelity would sell a majority of the forest to the Land Trust and keep a small portion for some type of future development on a more modest scale than what was originally proposed.

Chalfant said he isn't at liberty to say just how much an outright purchase of the forest might run the Land Trust, but he said the organization is already in line for more than $1 million in federal funding through Congress' Forest Legacy program. Another upcoming round of federal funding could increase that total. And he's optimistic that the project will continue to remain a priority for lawmakers because of its unique attributes.

"The agencies have felt strongly that this is one of the most important forest projects in the country," Chalfant said.

"Typically they're protecting a few hundred acres of forest. To do a large acreage like this immediately adjacent to a growing urban center is pretty unique. What it does is allow you to create a showpiece and educate people in a way that you can't do if it's 75 miles from town," he said.

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