
Concept
Entity Formation
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Problem
There have been ongoing efforts for the past many years to improve supply chains of forest biomass through efforts by collaboratives, non-profit organizations, and the State of California.
These actions have been stymied by several factors, including (1) poor public perception of biomass waste removal, despite negative impacts of leaving it or burning it, (leaving it increases fire severity and burning it impacts public health), (2) the bad reputation of biomass to electricity power plants among environmental groups, and the consequential lack of commitment of the CPUC and the Investor Owned Utilities to recognize any value in biomass conversion to electricity, (3) the high transportation costs of wood waste removal, and (4) a lack of state organizational structure to effectively deal with the topic. In order to achieve success, these four issues must be addressed, as well as other key issues that will be discussed below.
Reports & Resources
- North Coast Summary of New Entity Formation for Woody Biomass Management (Legal report)
- Joint Powers Authorities A Tool To Manage Forest Biomass Residuals In California
- Legal Tools for Government Entities to incentivize Utilization of Forest Biomass in California
- Central Sierra Woody Biomass Aggregation Pilot Project: Organizational Study Executive Summary and Full Report (March 2025, ERG)
- Local Public Entity Solutions for the Forest Biomass Markets in the South Central Sierra (October 2023, CLERE, Inc.)
- Redwood Alternative Agriculture Fund Final Report
- Forest Reciprocity Group Final Report
- Regenerative Forest Solutions Final Report
Solution
Summary: Each pilot region identified a place based strategy given the needs of their communities and available capacity to administer a new Public Private Partnership. A total of six (6) reports were developed across the state to assess the legal framework to address entity formation options to support long-term feedstock contract development. The reports propose various governance models which can be categorized into four distinct frameworks:
- Public governance entities, such as Joint Powers Authorities (JPAs), Community Services Districts (CSDs), and Climate Resilience Districts (CRDs) offer large scale coordination among entities with public interest, but face bureaucratic and funding-related challenges.
- Cooperative models, including producer cooperatives and multi-stakeholder cooperatives, provide a decentralized and member-driven approach to biomass management but present operational and governance challenges.
- Nonprofit organizations, including 501(c)(3) entities and sole member LLCs under nonprofits, offer mission-driven approaches often tied to public interest for biomass utilization, but struggle with financial sustainability and operational flexibility
- Private sector entities, such as Social Benefit Corporations (SBCs) and Social Purpose Corporations (SPCs), aim to blend profitability with environmental and social esponsibility but face investment and regulatory challenges.
Public governance structures were seen as the most viable across regions, and is summarized in detail below.
In Depth Concept Explanation
It is critical to improve the public perception of the value of removing biomass waste from natural lands, as well as where that wood waste goes. There is a plethora of science that demonstrates that removal of wood waste is a critical component of the success of wildfire reduction (alongside prescribed fire). Also, using biomass for electricity production is still the cheapest and easiest way to use the wood waste for something productive while disposing of it effectively. New ceramic filtration technology can also make this significantly cleaner for use in areas of the state impacted by poor air quality, and California regulations already protect against using large trees or incentivizing trees grown just for power generation. Next; the costs of transportation of a heavy commodity like wood will always be high.
The State needs to actively amplify existing research, and fund more research that explicitly describes the costs of inaction. Studies about the non-economic benefits of biomass removal, relating to human health, water quality, wildlife, tourism and soil should be at front and center of the dialogue. Ultimately, the state needs to commit an agency or other state group to the task of organizing and championing this issue amongst the many state and local players in the space.
Biomass removal and utilization is a complicated, siloed, and generally ignored issue by our state government for the past thirty years. Recognition that this wood residues cause significant problems has been known, but the solutions are not easy, and there is no silver bullet. That being said, the influx of organized local support could be a game changer in some parts of California.
Durable legal structures like Joint Powers Authorities or Special Districts can provide the stability needed to the local communities where these challenges reside. They can help develop the consensus that forest residue removal is critical to the success of fuels treatments, and they can get public sector leadership and communities involved in building markets for biomass material at a regional level. The struggles of the past are pernicious, and one reason for this is because those who work on these issues within communities come and go. Nonprofit groups, collaboratives and ad hoc committees are not always sustainable, key staff leave organizations, and the lack of clear leadership can create a local void. Longer term legal structures can help maintain constancy for an issue that takes steadfast commitment to address. The seven pilot projects involved in the LCI Pilot Projects have identified several implementation goals and strategies to improve the bioeconomy in their communities that reflect their understanding that nature and people are inextricably connected. Some of these approaches are similar, and some distinct, but all provide starting points for others in California and beyond that are tackling similar issues.
Pilots are focusing on entrepreneurship, economic development and training of the private sector. Also, they can help existing businesses that are struggling, including their transitions from older technology, and help them address legacy social and environmental issues of wood waste management of the past. They can also build robust relationships with landowners of all types, from small private nonindustrial land owners, state lands, and the many different federal agencies. In particular, they could enter into new Good Neighbor Agreements with the US Forest Service, or use USFS new contract mechanism called “G to Z”, or use Interpersonnel Act to provide staff to the USFS on loan. They can invest in the development of public/private infrastructure, or organize leasing of equipment or land to private endeavors. They can host educational programs, provide regional advocacy at the state and federal level, and provide essential coordination on biomass removal, transport and utilization at the grassroots level, ensuring that there is community buy-in and overall success.
JPAs can finance projects, organize communities to work together to find solutions that they agree on, provide constancy and advocate with state agencies more effectively. They can also finance solutions, provide local know-how, and stability of staff in situ. Special Districts may also be an effective pathway if a water agency or other public services district has woody biomass disposal issues within their jurisdiction. In determining what kind of an entity is best for an area, it is always important to first ask if there is an existing entity that can add this focus to their already existing scope. For example, existing waste management agencies, economic development agencies, or wildfire prevention authorities that already include multiple different local agencies on their board are an excellent place to start. Otherwise, setting up a JPA is also relatively simple if a group of local agencies, especially those of the same type, are interested in problem solving this issue.
Status
The LCI Pilot Project persuaded four existing JPA entities to bring biomass into their workplan, initiated the creation of one new JPA, and brought together three forested, suburban counties to pass a Memorandum of Agreement to work together on this topic, and all of the groups, with funding allocations, are ready to implement change in their respective areas.
