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Legislative News and Views - Rep. Dale Lueck (R)

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News re: proposed timber project

Wednesday, June 15, 2016

Dear Neighbor,

Yesterday was a very big day at the Iron Range Resources and Rehabilitation Board (IRRRB) meeting!

We authorized up to $10 million for the public infrastructure needed to support a $440 million Louisiana-Pacific (LP) Corp. project to build a large wood products manufacturing plant in the Laskin Energy Park at Hoyt Lakes.

The package also includes $20 million from the Minnesota Department of Employment and Economic Development (DEED) and $6 million in potential sales tax relief. 

The project negotiations have been working quietly in the background for some time. Yesterday, the first public details of the project were unveiled by LP Corp. executive Brian Luoma at the IRRRB meeting. LP Corp. is an experienced wood products manufacturer that is looking to directly employee up to 250 workers in our region. Of special significance is the annual 700,000 – 800,000 cords of wood stock the plant would eventually consume.

The intent is to manufacture engineered wood siding primarily from aspen. For those familiar with Aitkin and Crow Wing County forests, that would be an important shot in the arm to the market our local loggers serve. Our package to create a ready-to-build site is in competition with other locations including Michigan and Canada. 

I remain cautiously optimistic. With yesterday’s IRRRB decision the general negotiations are essentially complete. The company now must decide if they can agree to the conditions of the package before the process can move forward to the design and construction phase.

Should LP Corp. locate this plant in our region this could signal the beginning stages of rebuilding our forest industry.Minnesota’s timber harvest peaked at about 4.2 million cords in the 1990s. The housing crash and accompanying severe recession caused Minnesota’s timber harvest to drop to around the current 2.6 million cords harvested annually.

The past 10-15 years has seen a number of area wood and paper plants permanently close. Today’s wood harvest is less than half the sustainable harvest rate outlined in the state's comprehensive environmental assessment on logging.  

LP Corp. operates nine siding manufacturing plants and 13 oriented strand board (OSB) plants in the US, Canada and Chile. Those operations include a siding plant at Two Harbors. Should this proposal continue forward actual construction could begin sometime in late 2017 or early 2018.

Sincerely,

Dale

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