Council’s proposed new rules could cost millions

October 30, 2023
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“Extreme” new rules proposed by the Otago Regional Council for Otago’s forestry industry could cost the sector more than a third of its land, wiping out more than NZ$320 million of the region’s forestry value.

City Forests Ltd chief executive and New Zealand Forest Owners Association president Grant Dodson told Otago regional councillors the forestry sector was concerned about setback rules proposed in the council’s land and water plan, now out for public feedback.

Under new national standards there was a 5m setback from small streams and a 10m setback from larger streams. Under the regional council proposal, a 50m setback would be implemented from waterways on a slope of greater than 10 degrees, or ‘‘pretty much the entire forestry estate in Otago’’, he said. ‘‘We don’t believe that the science has been properly investigated or applied in the development of the rules to date‘‘, Mr Dodson said.

‘‘We also note some significant sector inequities, which we believe is a major contributor to some perverse outcomes. We are feeling quite ambushed.’’ Mr Dodson told councillors last week there was concern among forestry owners for the proposed new consenting regime for existing, in some cases long-established, land use.

In the development of rules for the forestry sector there appeared to be input from ‘‘community, mana whenua and councillors’’, but not forestry owners, nor forestry Crown research institute Scion, he said. On behalf of forestry companies representing 125,000ha of plantations across the region, he said the council’s ‘‘extreme’’ rules could have ‘‘absolutely catastrophic’’ economic and social consequences.

There was no reason to expand on rules created through a separate nine-year process to set national environmental standards for commercial forestry, due to come into effect next month. Analysis showed the proposed 50m setback would result in an estimated 37% loss of productive forestry land in the region, which would equate to a more than $320m loss in value to the industry, he said.

‘‘It would completely change the value proposition for forest owners. The impacts on the industry would be dire”. There would also be significant liabilities with respect to the emissions trading scheme (ETS), he said. ‘‘We estimate those liabilities, under the current carbon price could top NZ$980m.’’

Using City Forests’ Waipori Forest as an example, he said under the council’s proposed rules the forest would lose 49% of its productive area, nearly NZ$17m in crop value, and cost more than $76m in ETS liabilities. For the Dunedin City Council-owned company as a whole, the 50m setbacks would mean a 34% loss in productive area, more than NZ$64m in crop value and a near NZ$198m ETS liability.

There were ‘‘literally hundreds’’ of studies that showed that pine trees planted to within 5m of streams produced ‘‘excellent’’ water quality outcomes. We know that fertiliser puts nitrates and phosphates into creeks. Forestry doesn’t fertilise. And so, a pine tree is being forced to move back 50m, and yet I could actually turn that into pasture, put livestock in it, fertilise the hell out of it, even discharge farm effluent in there — all totally detrimental to water quality — and that would be permitted under the plan,’’ Mr Dodson said.

Chief executive Richard Saunders understood the sector would submit on the land and water plan and welcomed the feedback. Mr Saunders hoped to hear from the industry, ‘‘particularly if they’ve got evidence to support’’ managing the effects of forestry on the environment differently from what the council proposed.

Source: Otago Daily Times, City Forests