# State nears deal on U.P. land



## kroppe (May 7, 2000)

http://www.detnews.com/2002/outdoors/0210/22/c10-617559.htm

State nears deal on U.P. land
Natural Resources grant to be used as seed money to buy 390,000 acres

By Associated Press

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Backers of a plan to purchase 390,000 acres of pristine Upper Peninsula land hope to fortify their chances this week with a multimillion-dollar state grant. 
Michigan's Natural Resources Trust Fund board will meet Tuesday to consider Gov. John Engler's request for $20 million to use as seed money to purchase the sprawling Kamehameha Schools Trust tract. The five board members are Engler appointees. 
Meanwhile, a spokeswoman for Kamehameha said the state agency is among "multiple" bidders for the prized U.P. property valued at $150 million. 
Susan Todani, of Hawaii-based Kamehameha Schools, would not identify the bidders or say how the state's offer stacks up against those of its competitors. She also would not discuss a sale deadline. 
"We are actively involved in the sales process," Todani said. "We have a tight schedule." 
Engler and the Nature Conservancy's Michigan chapter last month sketched out plans to combine state, federal and private funds to buy the Kamehameha property, valued at $150 million. Officials hope to use tax incentives plus contributions from state, federal and philanthropic sources to entice a timber industry partner. 
The logging company would pay the bulk of the purchase price, own the timber rights and 90 percent of the property, and would guarantee permanent public access through a conservation easement, according to the plan. 
Private ownership would keep the property on the tax rolls and ensure timber industry jobs to help support the U.P.'s historically wobbly economy. 
The Kamehameha property is scattered throughout much of the Upper Peninsula, including about 144,600 acres in Alger County, 91,870 in Luce County and more than 29,000 acres each in Baraga and Schoolcraft counties. 
Thousands of outdoor enthusiasts hunt, fish and snowmobile the heavily forested, lake-dotted Kamehameha land. 
Though the state has submitted a bid, it's not clear if it has signed a deal with a timber company. 
Philip Power, chairman-elect of the Nature Conservancy's state chapter, said Kamehameha officials demanded a confidentiality clause in the bid process, which prevents him from discussing possible partners. 
"I think it's fair to say we've talked to a number of private concerns," he said. "This deal is really difficult to do. There are lots of moving parts. We're working like hell to make this deal." 
Power said the confidentiality requirements make it difficult to cut through red tape to link the various state, federal and nonprofit bureaucracies involved in pulling off the deal. 
But he said Michigan's major charitable foundations have indicated significant support, though plan supporters haven't decided how much they'll seek from charitable sources. 
However, Power worries that a private timber company could "throw a ton of cash at" Kamehameha and better the state's offer. 
Seattle-based Plum Creek Timber Co. fits the bill of a deep-pocketed possible competitor. The nation's second-largest forest owner counts some 8 million acres among its holdings. 
Plum Creek currently is completing a deal for 305,000 forested acres in Wisconsin -- and a sliver of land in the western U.P. -- for a reported $142 million. Spokesman Robin Wood said the company continues to seek property and is familiar with the Kamehameha tract. 
Michigan's request for $20 million from the Natural Resources Trust Fund is one of 69 applications the board will study this week. 
The trust is funded by oil, gas and mineral leasing royalties and typically allots $17 million to $20 million land purchases each year.


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