Yak Timber closes after shareholder opposition

0
Yak Timber was established in July 2018 to harvest 21 million board feet from Yak Tat Kwaan Inc. Forest land remaining from a 1979 partnership with Koncor Forest Products. YAK Timber has since harvested more than 15 million board feet of lumber and exported that lumber to China, according to its website.

A logging company run by the Yakutat Village Corporation is disbanding. Yak Timber was established four years ago to harvest 21 million board feet of land owned by Yak-Tat Kwaan, Inc. The forestry subsidiary has since harvested about three-quarters of that – some 15 million board feet – and shipped them to China, according to its website.

As CoastAlaska’s Angela Denning reports, Yak Timber is closing its doors after shareholders turned down a proposal to operate a major island just outside the city.

Yak Timber’s logging has been controversial in Yakutat, a village of about 600 people in the Gulf of Alaska. As a subsidiary, it is supposed to extract value from the company’s land holdings to fund shareholder dividends. But Yakutat’s tribal and municipal governments – along with a significant number of shareholders – have spoken out against past clearcutting which they fear will damage salmon habitat and endanger their way of life. life.

More recently, Yak Timber faced backlash over a proposed logging of the company’s land near Khantaak Island (pronounced CAN-tak).

“Khantaak is seen as a barrier island for our community,” said Marry Knutsen, cultural heritage director for the Yakutat tribe. “It’s literally right in front of the city and blocks out all the severe storms that come off the Gulf of Alaska. And so it keeps us out of high-velocity winds. And it protects against tsunamis.

Yak Timber planned to harvest the island by thinning rather than clearcutting – choosing specific trees and leaving most of the forest intact.

In a letter to shareholders, parent company Yak-Tat Kwaan, Inc. says the decision to mine the island was made in the best interest of the community. The company says it had hoped to use revenue from timber harvesting to fund new business ventures and help community members build homes.

“Ultimately, the board felt there would be more benefit to shareholders if the company went ahead with tree thinning, subject to strict guidelines such as a zone 300-foot buffer from shore and daily monitoring,” Yak-Tat Kwaan’s board told shareholders in a letter dated Oct. 4.

But it was still too much for many. Knutsen says that in addition to the island’s geographic significance, it is culturally significant.

“Before we have the process of burying people in a specific place, we also cremate them, which would then make the trees culturally modified trees, wouldn’t they,” Knutsen said. “So we haven’t been able to do enough exploration there as a tribe to be able to say where all of those specific places might be.”

Yakutat tribal fisheries biologist Hava Roelof says Khantaak’s waterways need to be surveyed before any logging takes place. State biologists did not record any oceanic fish in the streams, so Roelof hiked the island to study them herself.

“None of the streams that are there are currently cataloged by the state, so they don’t have anadromous protections,” she said. “It’s ideal coho habitat, it’s just coho habitat. So my focus right now is just to map the entire stream system and make sure that if the coho are using the streams they are documented in, they will be protected.

Yak-Tat Kwaan cites opposition to Khantaak logging as the reason for its closure. With debts maturing and no viable source of income, the company’s board said it had no choice but to dissolve Yak Timber and sell its assets.

“Yak Timber had significant debts that required revenue and cash flow for service, which could only be effectively generated by harvesting the timber,” the council letter states.

Yak Timber and Yak-Tat Kwaan, Inc. did not respond to requests for comment.

But some shareholders say they are not responsible for Yak Timber’s closure.

Jason Jensen is a descendant of a shareholder who worked for a company to which Yak Timber entrusted the loading of its wood on ships.

“If you read the fine print this is what it looks like, it’s our fault we didn’t let them do this,” Jensen said. “Almost every shareholder here has the same mindset that it seems like they’re trying to blame it on the shareholders because they’re not a successful business enterprise.”

He says shareholders were unaware of the company’s finances and there was a problem with transparency. Meanwhile, he says the logging company went bankrupt by taking out loans, acquiring equipment and taking on more debt without communicating with shareholders.

“It just seemed that every step of the way there was a roadblock, there was something – canceled meetings, canceled elections and non-stop stuff on the road, the blockade, or to prevent shareholders from ‘get the information they wanted,’ Jensen said. “And so at one point that number came out that there was about $14 million in loans, and the collateral was land that the shareholders never agreed to give up.”

Yak-Tat Kwaan says the company plans to sell all of Yak Timber’s equipment and assets at an auction in Seattle in the coming months.

Letter from Yak-Tat Kwaan to shareholders Page 1, Page 2, Page 3, Page 4

Share.

Comments are closed.