Forest at a CROSSROADS

WHEN THE STATE OF MARYLAND AGREED TO BUY CHESAPEAKE-IMPORTANT FORESTLAND, THE QUESTION BECAME: HOW TO KEEP IT THE SAME WHILE MAKING IT BETTER.

On this early January morning, as it flows the half-mile from bend to bend past unbroken banks of tall pines and hardwoods, the river seems cloaked in white. But the covering is neither snow nor ice; it is thousands of wild tundra swans and other waterfowl, drawn to this nighttime resting place by its forested isolation.

That remarkable scene on Maryland's rural Eastern Shore, surely worthy of a national wildlife refuge or public park, is actually in the midst of a working forest: thousands of acres of loblolly pine plantations owned for decades by Virginia-based Chesapeake Corporation.

The Company's forest products division always observed the wooded streamside buffers required by Maryland law--and then some. On tours of its 58,000 acres of Maryland timberlands, Chesapeake's foresters also pointed with pride to the trees they chose not to cut--tracts with riverbottom cypress and Atlantic white cedar, islands of huge pines bordering salt marshes, and high banks overlooking some of the area's prettiest tidewater creeks.

But recent years brought ominous signs of change for the corporation's Chesapeake Forest Products division. The parent corporation sold its paper mill, becoming more of a landowner with vast holdings than a timber company.

"It makes them look at land differently," said Larry Walton, Chesapeake's regional forest manager, on a tour a few years ago. The company had stockholders to satisfy, Walton said. And it had a development subsidiary that was already transforming some 10,000 acres, mostly in Virginia, from trees to housing.

The Eastern Shore is an easy day trip from Washington, Baltimore, and Philadelphia. Land there is increasingly seen as too profitable to be left in the farms and forests that, ironically, attract prospective homeowners in the first place. And land-use regulations in many of its counties invite rampant sprawl development.

Walton, struggling at the time to keep his Maryland lands in forestry, was floating plans to his bosses that ranged from selective, high-end waterfront housing development to managed game hunting areas, all of which he hoped could coexist with timbering. Any such plans became moot in April 1999, when Chesapeake announced it was selling its entire forest holdings to John Hancock Mutual Life Insurance Company.

The news prompted a summer of feverish and delicate negotiations with Chesapeake and Hancock by Maryland's Department of Natural Resources (DNR) and The Conservation Fund, a national, nonprofit that has preserved 1.7 million acres of land since it was founded in 1985.

Environmentally, it was a once-in-a-life-time opportunity for Maryland: a chance to preserve nearly 1 percent of its total acreage. That's no small feat when you're already the fifth most densely populated state in the nation and you're poised to add another million residents by 2025.

It is also a state working to restore the Chesapeake Bay, whose tidal waters border 16 of Maryland's 23 counties as well as Baltimore city. Forests are now recognized as the land use that generates the least-polluted runoff to the Bay.

Tree loss is of especial concern in the Chesapeake Bay area, particularly in light of satellite surveys done by AMERICAN FORESTS that show the lower Chesapeake Bay watershed has lost nearly a third of its heavy forest cover. The Chesapeake Bay Program has pledged to plant buffer strips along 2,010 miles of Bay waterways by 2010.

The 58,000 acres of Chesapeake Corporation's Maryland lands included more than 11,000 acres of unaltered wetlands and dozens of miles of frontage on five Eastern Shore rivers. They also linked up well with existing DNR holdings and overlapped to a remarkable degree with the agency's "green infrastructure"--GIS mapping showing those areas most critical for environmental protection.

"Those lands were the ideal vehicle for virtually every one of DNR's goals for water quality, wildlife, recreation--they touched all our objectives like nothing I'd ever been associated with," says Mike Nelson, the department's director for land and water conservation services.

But there was another consideration. Taking that much land out of private forestry would do more than just cause property tax losses in five rural counties. The loss of timber base might be enough to kill the whole forest industry in that region of the state.

Also, Maryland's "smart growth" strategy, which channels growth by focusing state infrastructure investments away from the countryside, calls for supporting natural resource-based industries as a defense against unplanned sprawl.

By the fall of 1999. A unique and challenging deal and had evolved. Maryland along with The Conservation Fund, which had a longstanding commitment to sustainable forestry, each put up $16.5 million to buy the entire 58,000 acres for the dual purposes of sustainable commercial forestry and environmental protection.