Oregon sold $100 million in bonds on Thursday to pay a portion of the Elliott State Forest’s obligation to raise money for schools.
State Treasurer Tobias Read announced the completion of the sale, which will deliver $100 million into the state’s Common School Fund.
The state will repay the bonds to investors over 20 years with 3.83 percent interest.
The bond sale is the cornerstone of a new plan to separate the Elliott State Forest from its requirement to raise revenue for the Common School Fund.
In the past, the state has raised revenue for the Common School Fund through logging in the Elliott State Forest near the southern coast. In recent years, lawsuits over endangered species have prevented timber sales and limited the revenue the state can raise from the forest.
The state considered selling the land to meet its obligation to the Common School Fund, but in 2017 the State Land Board voted to cancel the sale and keep the forest in public ownership.
According to Read, the $100 million bond sale will affect about 82,500 acres of forestland near Reedsport, and the Common School Fund will now have a balance of about $1.7 billion.
The Land Board is exploring ways to compensate the Common School Fund for the full $221 million appraised value of the forest so that the land can be managed for public benefits such as habitat and recreation and not primarily for the financial benefit that comes from logging.
“The future of the Elliott State Forest is on a more sustainable path today,” Read said in a statement.
Last month, the Land Board agreed to start working with Oregon State University convert the land into a research forest. But an additional $121 million is needed to compensate the Common School Fund, and it’s still unclear where that money will come from.