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WESTERN HARDWOOD ASSOCIATION Annual Meeting June 27, 2005 Sunriver, Oregon WESTERN HARDWOOD ASSOCIATION Annual Meeting June 27, 2005 Sunriver, Oregon

Topics • • Update on Hardwood Federation activities Hardwood Federation PAC Current Priority Issues Topics • • Update on Hardwood Federation activities Hardwood Federation PAC Current Priority Issues Questions

Hardwood Industry Umbrella • Created in April 2004 to present a united front for Hardwood Industry Umbrella • Created in April 2004 to present a united front for the hardwood industry with an emphasis on government relations • Started with 11 trade associations • Currently 22 hardwood organizations, representing over 4, 500 companies • A united force to keep the hardwood industry viable for future generations

Vision – A Healthy Hardwood Community Through political action: • Maintain a healthy business Vision – A Healthy Hardwood Community Through political action: • Maintain a healthy business environment for family businesses and small companies in the hardwood community • Maintain commercial access to federal and private hardwood timberlands • Maintain and improve the health of public and private hardwood forests through effective legislation

HF Structure • Members of the HF provide financial support for administration (both associations HF Structure • Members of the HF provide financial support for administration (both associations and companies contribute). • Association members join – then their membership automatically becomes a member as well. • The Federation is responsible for the costs and managing the Hardwood PAC. • The Hardwood Federation and the Hardwood Federation PAC are two separate organizations.

HF Board of Directors • Associations contribute funding to administer HF. • $5, 000 HF Board of Directors • Associations contribute funding to administer HF. • $5, 000 = eligible for seat on Board for a two-year term. • The Board of Directors is the governing body of the HF and guides issue development and Federation policies.

Hardwood Federation Partners American Forest & Paper Association (AF&PA) Appalachian Hardwood Manufacturers, Inc. (AHMI) Hardwood Federation Partners American Forest & Paper Association (AF&PA) Appalachian Hardwood Manufacturers, Inc. (AHMI) Appalachian Lumbermen's Club Hardwood Distributor's Association Hardwood Manufacturers Association (HMA) Hardwood Plywood & Veneer Association (HPVA) Illinois Wood Products Association (IWPA) Indiana Hardwood Lumbermen's Association (IHLA) Kentucky Forest Industries Association (KFIA) Lake States Lumber Association (LSLA) Los Angeles Hardwood Lumbermen’s Club Memphis Lumbermen’s Club National Hardwood Lumber Association (NHLA) National Wood Flooring Association (NWFA) NOFMA: The Wood Flooring Manufacturers Association Pacific Coast Wholesale Hardwood Distributors Association Pennsylvania Forest Products Association Penn-York Lumbermen's Club Southern Cypress Manufacturers Association Southwestern Hardwood Manufacturers Club Western Hardwood Association Westside Hardwood Club

Why form a national political action committee for the hardwood industry? • Geographic reach Why form a national political action committee for the hardwood industry? • Geographic reach of industry, with its huge employment base, is an asset when soliciting contributions and coordinating volunteer efforts to support the legislators who support us. • More political clout in Washington, D. C. • Energize your individual membership by getting them involved in the political process. • Entire industry can use services of D. C. based Executive Director and hardwood lobbyist. • Industry more informed about policies and people representing them.

Hardwood Federation PAC • The HFPAC is a voluntary, nonpartisan action fund for members Hardwood Federation PAC • The HFPAC is a voluntary, nonpartisan action fund for members of the hardwood industry. • Federal law prohibits companies from contributing corporate dollars to political campaigns. Any individual can contribute to the HFPAC. • The HFPAC can only solicit donations from members of the Hardwood Federation, who have signed a solicitation authorization form. • Federal law limits an individual’s contribution to the HFPAC during any calendar year to $5, 000.

HFPAC Board of Directors • Board determines which candidates to support with PAC funds HFPAC Board of Directors • Board determines which candidates to support with PAC funds • Any association member contributing $5, 000 or more to the Hardwood Federation administrative fund automatically gets a seat on the HFPAC Board

 • Criteria for contributions to candidates Champion for issues that matter most to • Criteria for contributions to candidates Champion for issues that matter most to the hardwood industry • Voting record on key issues to the hardwood industry • Position on committees relevant to the hardwood industry • Elect ability and financial need • Hardwood companies located in the elected official’s or candidate’s voting district or state

2004 Election Milestone $320, 000 contributed to 195 hardwood friendly candidates in 2004 election 2004 Election Milestone $320, 000 contributed to 195 hardwood friendly candidates in 2004 election cycle

Election 2004 – Scorecard # of HFPAC Candidates Elected Defeated Victory % 195 187 Election 2004 – Scorecard # of HFPAC Candidates Elected Defeated Victory % 195 187 8 96% Senate Candidates Elected Defeated Victory % 19 15 4 79% House Candidates Elected Defeated Victory % 176 172 4 98%

2006 Election Cycle • PAC challenge – increase $$ for 2006 Election Cycle • 2006 Election Cycle • PAC challenge – increase $$ for 2006 Election Cycle • Our opponents continue to raise more money

Legislative Issues • Association members develop issue papers to be considered by the entire Legislative Issues • Association members develop issue papers to be considered by the entire Board for discussion and prioritization. • Board adjusts the HF legislative agenda to ensure we can react quickly and effectively to emerging issues of importance to the health of the hardwood industry.

2004 Victories • FSC/ETI Bill halted retaliatory actions by EU against wood and also 2004 Victories • FSC/ETI Bill halted retaliatory actions by EU against wood and also included specific timber tax initiatives. • U. S. Forest Service funded two early warning systems located in North Carolina and Oregon to protect hardwood forests from emerging pests and disease. • Halted the European Union’s proposed debarking standard on wood pallets by gaining a one-year extension on implementation of a law.

Tree Planting with Senator Lugar • Arbor Day • HF sponsored Tree Planting with Senator Lugar • Arbor Day • HF sponsored

Fall Legislative Conference Mandarin Oriental Hotel • September 27 & 28, 2005 • Rep. Fall Legislative Conference Mandarin Oriental Hotel • September 27 & 28, 2005 • Rep. and Dem. Congressional Receptions

Key Issues for 2005 • ESA Reform • Pro-Hardwood Provisions in HFRA • Elimination Key Issues for 2005 • ESA Reform • Pro-Hardwood Provisions in HFRA • Elimination of Estate Tax • Oppose LEED Building Standards • Broad Tax relief for US Hardwood Industry • Protect wood pallets from unreasonable trade restrictions • Invasive Species • WTO Review of FSC/ETI Bill

Emerging Issues • Imports • 2006 Farm Bill Emerging Issues • Imports • 2006 Farm Bill

Your Voice in Washington Headquarters now in heart of our nation’s Capitol Full time Your Voice in Washington Headquarters now in heart of our nation’s Capitol Full time lobbyist – Grace Terpstra

Lobbying Congress Grassroot contacts PAC contributions DC – On-the-ground Lobbying Congress Grassroot contacts PAC contributions DC – On-the-ground

Key House. Members Rep. Richard Pombo (R-CA) Rep. Jerry Lewis (R-CA) Rep. Norm Dicks Key House. Members Rep. Richard Pombo (R-CA) Rep. Jerry Lewis (R-CA) Rep. Norm Dicks (D-WA Rep. Greg Walden (R-OR)

Key US Senators Sen. Mike Crapo (R-ID) Sen. Conrad Burns (R-MT) Sen. Larry Craig Key US Senators Sen. Mike Crapo (R-ID) Sen. Conrad Burns (R-MT) Sen. Larry Craig (R-ID) Sen. Ron Wyden (D-OR)

Recasting the Issue Western Forestry=Hardwood Forestry Recasting the Issue Western Forestry=Hardwood Forestry