Carbon SB 5688 - HB 1789

SB 5688 and HB 1789  will enable the Department of Natural Resources to tap into new revenue streams to boost local communities, increase the pace and scale of reforestation, improve forest health, avoid conversion of our forestlands, and generate more funding for our beneficiaries. Being able to access the same carbon credit markets as the private-sector and non-profits will reduce the need for tax-payer support for critical natural resource investments. These new revenue streams will complement DNR’s current operations, generate more funds for beneficiaries, and enable us to deepen our investments in the sustainable management of lands and waters for present and future generations. These projects also have significant co-benefits, including reducing wildfire risk, protecting state, private, and Tribal lands, and supporting rural jobs and local economies.
Tapping into new revenue streams will boost local communities and increase the pace and scale of reforestation, forest health, avoided conversion, conservation, and habitat restoration on public lands, all of which are critical to keeping working forests working, supporting rural jobs and local economies, and meeting the state’s climate goals.
As a manager of nearly 6 million acres of forest, range, agricultural, aquatic, and commercial lands, the Department of Natural Resources (DNR) is uniquely positioned to tap into emerging markets for carbon credits and other ecosystem services to generate revenue for beneficiaries and fund critical agency efforts, including reforestation, acquisition of working forest lands, and restoration and recovery of aquatic and riparian ecosystems. 

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Learn more about the Carbon Bill

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Frequently Asked Questions

  1. Will this cost taxpayers money? 

    No. The sale of carbon credits will not cost taxpayers money. Instead, the sale of carbon credits will generate new revenue streams that will increase funding for beneficiaries – like counties and public schools – and decrease the need for taxpayer funding for critical natural resources investments.

  2. Will this bill increase working forestland in Washington state? 

    Yes. Carbon projects will result in a net gain of state trust working forestland as well as a net increase in sustainable harvest volume. 

    For example, with funding from carbon projects, DNR will be able to reforest post-wildfire areas that otherwise would not have regenerated. Currently, DNR has to apply for grants from organizations like the Arbor Day Foundation to replant after wildfires. These grants are limited and do not generate enough funds to fund the 138,000 acres that have burned in the last decade. With these lands reforested, we will increase the working forestland base, including increasing the value and volume of timber that would otherwise not be available but for the lands being reforested. 

    DNR will also be able to afforest lands that are currently fallow and acquire working forests at risk of development to ensure they stay working for generations to come. 

    Without funding from these markets, Washington will continue to see the loss of forest to development. Washington state has already lost over 400,000 acres of working forestland in a little over a decade and is slated to lose another 660,000 acres in the next two decades. With these funds, we can actually grow more trees than before as well as increase the amount of working forest land available.

  3. Why does the bill allow for contracts up to 125 years?

    Both the California and the Washington compliance markets require that projects monitor, report, and verify carbon stocks for at least 100 years following the last credit issuance. This means a contract term of at least 105 years is required, and up to 125 years. However, this does NOT mean that DNR would walk away for 100 years. Over the 100 years, the requirement is simply to maintain carbon stocks above the established baseline. This means that we can be harvesting, completing forest health treatments, and generally maintaining the forest throughout that 100 years, as long as they still allow for greater carbon storage compared to what would have happened in the absence of the project. In fact, because silvicultural practices like pre-commercial thinnings help to create resilient forests that more quickly take on volume and therefore carbon, those practices are actually incentivized under carbon protocols. So, if DNR were to do a reforestation project, for example, we would plant the trees, and then come back to do pre-commercial and commercial thinnings, and eventually be able to harvest according to a pre-determined management plan.

  4. Will this bill create jobs? 

    Yes. The scope of investment and productivity that carbon projects can fund in our forest, agricultural, and aquatic lands is immense. This includes critically important work like reforestation, afforestation, forest restoration and silviculture -- all practices of preparing sites for replanting, restoring, and cultivating the growth of resilient, healthy working forests. 

    For example, DNR will be able to make investments in critical forest management programs — like silviculture and forest restoration— that have been neglected due to lack of funding, all of which create good-paying, private-sector jobs in communities throughout our state. In addition, improved forest management can generate greater value and volume from our forests which also creating benefits downstream in jobs in milling and other sectors. 

    Additionally, due to a persistent lack of funding, DNR is forced to let forests regenerate naturally after wildfire, instead of planting new seedlings. Carbon credits will offset these planting costs. When we replant, we create jobs in reforestation and we create greater value and volume from our forests which benefit downstream jobs. 

    The same is true for other forestry investments, such as pre-commercial thinning, afforestation, working forestland conservation, urban forestry, habitat restoration, and riparian restoration thinning. All of these strategies grow more carbon, volume and value in our working forests and support hundreds of jobs. The more forests we can protect and keep working, the more wood will supply local mills, and the more good jobs we will have at every part of the supply chain. 

    And while many are focused on the impacts of the bill on forestry, this bill will also create investment opportunities on our agricultural, geological and aquatic lands. Jobs created in those areas include but are not limited to biomass, biochar, aquatic restoration, riparian habitat improvements, and basalt carbon capture. 

  5. Why is the fiscal note for this bill $0? 

    DNR’s implementation costs will be covered using existing resources. DNR operates as a business, one which generates more than $225 million each year for beneficiaries. We have in-house experts in carbon, forestry, agriculture, commercial real estate, mining & minerals, clean energy, geology and natural resources. This team is already deeply engaged in this work, including recently releasing DNR’s Carbon Playbook—a first of its kind for a state agency. We have the internal knowledge and capacity we need to successfully launch and manage this new venture. Further, if additional capacity is needed in the future, that will be funded with carbon project revenues – it will not require taxpayer funding.

  6. Will carbon projects have oversight and transparency? 

    Yes. The bill requires all carbon offset contracts or ecosystem service projects be approved by the Board of Natural Resources. This process, which is the exact same process that each DNR timber sale goes through, involves public notice, public comment and a transparency vote.

  7. Are carbon credits used for non-forestland projects? 

    Yes. Carbon projects can be used to conserve or restore submerged vegetation, like kelp forests and eel grass meadows. Projects can also restore and conserve wetlands. When it comes to our agricultural lands, projects could include investments in biochar and incentives to create riparian buffer zones. You can see more in our Carbon Playbook.

  8. Is the private sector utilizing carbon markets? 

    Yes. The private sector is leading the way when it comes to selling carbon credits.

    Examples include: 

    a) Port Blakely—Winston Creek Carbon Project Washington State - “Regardless of what industry you’re in, there’s no better way to create change than to lead by example. This burgeoning market needs visionary leaders to step forward and show others what can be accomplished.…a tree’s ability to capture carbon from the atmosphere increases exponentially between 35 and 60 years of growth. That’s why we practice patience, only harvesting our trees after they’ve had a chance to mature, add considerable mass, and play their part in protecting our planet." 

    b) Sierra Pacific—Received an award from the Climate Action Reserve (a carbon project registry) for submitting the most carbon projects of any entity in 2016. “Sierra Pacific Industries, in recognition of submitting the most projects in 2016 with eight Improved Forest Management projects submitted. …the eight projects are all located in California and cover 153,000 acres. The projects are expected to sequester emissions that would otherwise have been released into the atmosphere while providing important benefits to forest habitat and wildlife.” 

    c) Green Diamond—600,000 acres in Southern Oregon in a carbon project - “Green Diamond purchased some 600,000 acres of forest land in Southern Oregon in 2014. Since the acquisition, Green Diamond has been working to rehabilitate what had been a badly depleted forest. Through forest-health thinning and limited logging, the company is actively increasing the amount of timber—and sequestered carbon—on the landscape. Green Diamond registered the lands with the California Air Resources Board (CARB) in 2016 and 2017 under the agency’s Improved Forest Management carbon offset protocols. Green Diamond has carbon projects in four states and deals with regulated as well as voluntary markets.”

  9. Is the public sector utilizing carbon markets? 

    Yes. Public agencies, including in Washington State, have utilized carbon credits to fund incredible work on the ground. Examples include:

    King County—the county has both urban and rural carbon projects

    King County acquires high-value forests that are at risk of development and then offers buyers the opportunity to purchase carbon credits generated by keeping carbon in the forests. King County will then invest the revenue generated by the program to protect more forests and offer credits to additional buyers.

    Forests protected and managed under the program’s guidelines also will produce other benefits, such as cleaner air and water, healthier habitats for salmon and wildlife, and recreational opportunities.

    Microsoft committed to purchasing all of the credits from the rural program in its first year to offset carbon emissions from its operations. Kirkland-based Fishermen’s Finest is the first local company to purchase urban carbon credits from King County from a recently protected forest near Sammamish.

    Michigan DNR— The Big Wild Forest Carbon Project started in 2020. This project, taking place on over 100,000 acres of the celebrated Pigeon River Country State Forest known as "The Big Wild," creates a portfolio of carbon offset credits generated from sustainable forest management activities. Project development was completed in 2022 with a local energy company purchasing the first decade of carbon offset credits.

  10. How will this impact rural communities? 

    For too long, rural communities have provided vital ecosystem services to people across the state through the maintenance and protection of our working and natural forests without compensation for those services. This bill would change that. For the first time, the communities that are providing cool, clean drinking water, habitat for critical species, purification of our air, forest and agricultural resources, and flood mitigation, could be compensated for these ecosystem services that we all rely on.

  11. Is this bill “either/or” or “both/and”? 

    This is not about timber or the environment, climate or jobs. These are false distinctions – this legislation is both/and. This bill is about sustainable management of our working forests and increasing carbon sequestration and storage through reforestation. It’s about providing jobs to local mills and protecting forests from permanent loss to development. It’s about increasing the amount of forest we have across our state, while continuing to have the best forest management and sustainable harvest practices in the country.