O’BRIEN, Ore. — Jennifer Phillippi’s grandparents started producing lumber in this corner of Oregon timber country in 1922, when a man could set up a mill, log the trees within range of a team of horses, and move the mill to a new stand when those trees ran out.
In those days the forests were full, timber and work both plentiful. But now what was the last sawmill standing in Josephine County has hit the end of the line after yet another timber family had to give up hope the lands surrounding them could provide enough of the big pine logs they needed to stay afloat.
Phillippi and her husband, Link, are spending their last days at the helm of Rough & Ready Lumber handing out severance checks and hugs to their 88 employees, many of them also the third generation in the mill. The sawmill shut down in mid-April and will ship the last finished lumber in June.
“What they tell me is, one door closes and another door opens,” said Ron Hults, 50, who worked at the mill for 18 years operating the various machinery it takes to turn a rough log into a smooth piece of lumber. “I’m waiting for the open door.”
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So are many of the nearly 1 million who live in Oregon’s timber country.
The region’s troubles have reached a tipping point since the expiration last year of federal subsidies that were sent to rural counties across America. For 11 years the funds had offset revenue losses caused by reduced logging on federal lands to protect endangered and threatened species.
Oregon, with far more federal timberlands than other states, got nearly a third of that money — $105 million in 2012 alone.
The loss of the subsidies has forced timber counties to cut budgets to the bone. Sheriff’s offices have laid off deputies, cut patrols and released some jail inmates, only to see them arrested for new crimes. Frustrated citizens have tried to fill the gap with armed patrols.
The subsidies were never meant to be permanent, but rather were intended to buy time to build new economies. Today these communities are still looking for what’s next — even as some timber counties drift closer to bankruptcy and state officials make contingency plans in case they collapse altogether.
“There is no silver bullet,” said Bruce Webber, who directs the Center for Rural Studies at Oregon State University. “It sort of happens job by job and idea by idea. That is how change happens.”
As recently as the 1980s, logging and milling were important parts of the economies of nearly every part of Oregon, from big cities to remote mountain hamlets. But as logging diminished, so did the industry’s economic significance.
No Oregon community depends on timber as much as in years past. Tourism and light manufacturing join with schools, government and health care to provide jobs. But the more remote and rural the community, the tougher things are.
Unemployment rates across timber country tend to be in double digits. A quarter of Josephine County’s 83,000 people are on food stamps. Food banks struggle to keep cans on the shelves. Young people move away to find work.
Some economists have blamed timber country for not doing enough to get itself out of the mess. Property tax rates in the region are the lowest in the state, a legacy of when the federal timber revenues paid the bills, and residents have repeatedly voted down tax increases. On Tuesday, three counties — Lane, Josephine and Curry — will try again, asking voters to raise taxes to pay for law enforcement.
“Always in the past people felt the federal government would come through” and renew the subsidies, said Curry County Commissioner Dave Itzen. “The federal cavalry is not coming … In fact it’s so far away, you can’t hear the bugle.”
An hour’s drive east of the coast, just north of the California border, the Rough & Ready mill is ringed by the timbered expanses of the Rogue River-Siskiyou National Forest. Gold mines once prospered here, but when the gold ran out, logging became Josephine County’s economic foundation.
After World War II, the U.S. Forest Service began selling timber to build homes for baby boomers. Bulldozers carved roads into the hillsides to haul out the logs. Mills operated round-the-clock. No tree was too big to be cut.
“You could get a job anyplace,” said Jim Ford, 85, of Grants Pass, the Josephine County seat. Ford quit high school during World War II to work as a logger. At 14, he threw steel cables around giant logs so they could be hauled and loaded onto trucks. After the war, he and his brothers started their own logging business. It closed in 1993.
All that remains now are faded photos of logging trucks and a collection of hard hats, chain saws and pulleys hanging from the walls and ceiling of the shop behind Ford’s house.
His two sons left home to find work — one in construction in Portland, the other as a fisherman in Alaska.
“We could see it coming,” Ford said. “You’d see one mill close down, and pretty soon there’d be another one.”
Change came through upheaval. In 1982, Earth First! protesters lay down in front of bulldozers to stop construction of a road intended to open up a mother lode of Siskiyou National Forest for area mills. Conservation groups eventually sued, and the road was never finished.
By 1994, more lawsuits forced the Forest Service to cut logging by 90 percent in the Northwest to save species such as the northern spotted owl and salmon from extinction. Logging jobs in Oregon dropped from 11,000 in 1990 to about 5,000 now. Mill jobs went from 46,000 to 20,000.
Rob MacWhorter, supervisor of the Rogue River-Siskiyou National Forest, knows that the good old days of logging aren’t likely to return. The Forest Service is focused now on restoration and reducing the threat of wildfire. Where MacWhorter’s predecessors spent their days filling timber quotas, he meets with community groups looking to diversify the economy.
In Curry County, MacWhorter and Itzen, the county commissioner, sit on a task force examining ways to build that new economy. Various ideas are being floated, including marketing the region’s blue skies, forest and rivers full of salmon to tourists from Asia and other parts.
“We are finally getting to common ground, common interests coming to the table trying to find solutions,” MacWhorter said.
“We haven’t been sitting on our hands,” added Itzen.
Itzen grew up in Curry County, and he still has scars on his hands from working in a plywood mill to put himself through college. Now he works to convince voters to support the proposed tax increase. Otherwise, he said, the county will go broke. But he concedes it’s difficult persuading folks to forget the past and see the future.
Logs are still coming off the forest, but they are fewer and smaller — not enough to sustain places like Rough & Ready.
Jennifer and Link Phillippi spent 25 years running the business, investing millions to computerize equipment and improve efficiency. They even bought thousands of acres of timberland to supplement the declining supply from the national forest.
In recent years, however, it grew harder to find the larger, 18- to 20-inch pine logs they needed to fill their niche in the timber market, producing lumber for doors and windows.
“Having to close it down weighs heavy on us, especially for these families that really counted on us to figure something out,” Jennifer Phillippi said. “We have all the pieces we need to continue to be a productive company. … The only thing we’re missing is a log supply.”
Mills that converted to processing smaller logs or producing laminated beams are still operating elsewhere in Oregon, and the Phillippis are confident their workers will land jobs if they are willing to move. The couple has turned to selling logs from their own private timberlands to make a living.
“We love this industry. We’d stay in it if there were something on the horizon,” Link Phillippi said. “There aren’t a lot of opportunities for these counties to be healthy. It’s a beautiful place to live. It’s a hard place to make a living.”