The Pacific Lumber Company, officially abbreviated PALCO, and also commonly known as PL, was one of California's major
logging and
sawmill
A sawmill (saw mill, saw-mill) or lumber mill is a facility where logs are cut into lumber. Modern sawmills use a motorized saw to cut logs lengthwise to make long pieces, and crosswise to length depending on standard or custom sizes (dimensi ...
operations, located 28 miles (45 km) south of
Eureka
Eureka (often abbreviated as E!, or Σ!) is an intergovernmental organisation for research and development funding and coordination. Eureka is an open platform for international cooperation in innovation. Organisations and companies applying th ...
and 244 miles (393 km) north of
San Francisco
San Francisco (; Spanish language, Spanish for "Francis of Assisi, Saint Francis"), officially the City and County of San Francisco, is the commercial, financial, and cultural center of Northern California. The city proper is the List of Ca ...
. Begun in 1863, PALCO was carefully managed over most of the twentieth century by generations of the
Simon J. Murphy, Sr. Family or managers chosen by the Murphys from 1905 through 1985. Primary operations existed in massive log storage and milling operations at the historic
company town of
Scotia, California
Scotia, formerly known as Forestville until 1888, is a census-designated place in Humboldt County, California. It is located on the Eel River along U.S. Route 101, southeast of Fortuna and north of San Francisco. Scotia has a population of 85 ...
, located adjacent to
US 101
U.S. Route 101, or U.S. Highway 101 (US 101), is a north–south United States Numbered Highway that runs through the states of California, Oregon, and Washington, on the West Coast of the United States. It is also known as (The Royal Roa ...
along the
Eel River. Secondary mills were located in nearby
Fortuna
Fortuna ( la, Fortūna, equivalent to the Greek goddess Tyche) is the goddess of fortune and the personification of luck in Roman religion who, largely thanks to the Late Antique author Boethius, remained popular through the Middle Ages until at ...
and
Carlotta. PALCO had extensive timber holdings exceeding well over 200,000 acres (890 km²) in the Redwood and Douglas-Fir forests of
Humboldt County. For generations, it was one of the largest private employers in the entire region, appropriately known as the
Redwood Empire
The North Coast of California (also called the Redwood Empire or the Redwood Coast in reference to the dense Sequoia sempervirens, redwood forests throughout the region) is a region in Northern California that lies on the Pacific coast between Sa ...
.
The company was transformed into a wholly owned subsidiary of
Maxxam, Inc for its two final decades. In January 2007 the company filed for bankruptcy protection. On July 29, 2008, the "Final Order" from US Bankruptcy attorney, Judge Richard Schmidt, led to the transfer of the assets of the bankrupt PALCO and all its subsidiaries to the
Mendocino Redwood Company
The Mendocino Redwood Company (or MRC), is a California based forest products company, which operates one mill in Ukiah, California, Ukiah, with holdings of over , primarily in Mendocino County, California, Mendocino County.
Background
This rela ...
and the town of Scotia to Marathon Structured Finance. After 145 years as PALCO, the new company is known as the
Humboldt Redwood Company Humboldt may refer to:
People
* Alexander von Humboldt, German natural scientist, brother of Wilhelm von Humboldt
* Wilhelm von Humboldt, German linguist, philosopher, and diplomat, brother of Alexander von Humboldt
Fictional characters
* H ...
. Some of the affected parties, including Bank of
New York Trust Company
The New York Trust Company was a large trust and wholesale-banking business that specialized in servicing large industrial accounts. It merged with the Chemical Corn Exchange Bank and eventually the merged entity became Chemical Bank.
History
On ...
, filed an appeal and on September 29, 2009 the Court of Appeals for the 5th Circuit modified this judgment. However, the asset transfer and resulting companies were little changed by the modification and no other adjustments of any significance have occurred since.
Overview
The Pacific Lumber Company was started in 1863. Though it employed over 350 people in its final days in 2008, there were over 1,600 employees at the turn of the millennium. The company itself was a tourist attraction that once welcomed visitors for a tour of the (now permanently closed) largest
Redwood Mill ever constructed, which included an unusual
hydraulic debarker
A hydraulic debarker is a machine removing bark from wooden logs by the use of water under a pressure of or greater. Hydraulic debarking can reduce soil and rock content of bark, but may increase the water content. Debarking water may be recycl ...
. The quaint town adjacent to the mill is still open to public visits. Pacific Lumber has been at the center of multiple controversies since a hostile takeover by Maxxam, Inc. (of Texas), that was completed in 1986. The company maintains that it is still a sustainable operation, but its policies and practices bear little resemblance to those before 1986. 1999 saw the sale of thousands of acres of land to become the
Headwaters Forest Reserve
The Headwaters Forest Reserve is a group of old growth coast redwood (''Sequoia sempervirens'') groves in the Northern California coastal forests ecoregion near Humboldt Bay of the U.S. state of California. Comprising about , it is managed by t ...
. In that agreement, strict rules were put into place requiring the company to manage its holdings under more-restrictive practices. This in part led PALCO to file for bankruptcy in January 2007. By late in 2008 The Pacific Lumber Company ceased to exist.
History
19th century
Pacific Lumber (or PL, as locals have known it for generations) began during the heat of the
US Civil War
The American Civil War (April 12, 1861 – May 26, 1865; also known by Names of the American Civil War, other names) was a civil war in the United States. It was fought between the Union (American Civil War), Union ("the North") and t ...
in 1863 when A. W. McPherson and Henry Wetherbee purchased of timberland on California's Eel River at the rate of $1.25 per acre. Over the ensuing 20 years they added more partners and began significant logging by 1882, at the present main site and town, which was originally known as Forestville. By 1888, the company became the largest in Humboldt County, with 300 employees and lumber shipments exceeding annually. By this time the town name was changed to
Scotia
Scotia is a Latin placename derived from ''Scoti'', a Latin name for the Gaels, first attested in the late 3rd century.Duffy, Seán. ''Medieval Ireland: An Encyclopedia''. Routledge, 2005. p.698 The Romans referred to Ireland as "Scotia" around ...
and it boasted a
Western Union
The Western Union Company is an American multinational financial services company, headquartered in Denver, Colorado.
Founded in 1851 as the New York and Mississippi Valley Printing Telegraph Company in Rochester, New York, the company cha ...
telegraph station, church, post office, and school. In 1895, the company suffered a major setback as the entire town burned, suffering $400,000 in losses ($8,000,000 in today's terms). By that time, Simon J. Murphy, Sr. a Detroit business man and one of its first millionaires had consolidated his millions from Detroit and Southern California into PL. The Simon Murphy family, Stanwood Murphy and his direct descendants would be the controllers of the company for nearly a century
[North Coast Journal]
''Scion''
retrieved February 10, 2008. The way they took care of business was shown handily after the big fire as they chose to rebuild everything, despite the fact that insurance covered only 25% of losses.
20th century
Life during early 20th century lumbering is documented by the Neill family’s Photo Album, which features 292 photographs of the Neill family, townspeople, and daily life in the company town of
Scotia
Scotia is a Latin placename derived from ''Scoti'', a Latin name for the Gaels, first attested in the late 3rd century.Duffy, Seán. ''Medieval Ireland: An Encyclopedia''. Routledge, 2005. p.698 The Romans referred to Ireland as "Scotia" around ...
. Images reflect everyday life and hardships, local residents and homes, vacations, trips into the surrounding forest, and Pacific Lumber Company’s mill and work operations, between the years of 1908 and 1913. The Neil Photo Album is available for viewing at Humboldt State University’s Special Collections.
By 1905, Simon Murphy, Sr., originally of
Detroit, Michigan
Detroit ( , ; , ) is the largest city in the U.S. state of Michigan. It is also the largest U.S. city on the United States–Canada border, and the seat of government of Wayne County. The City of Detroit had a population of 639,111 at ...
and later of
Whittier, California
Whittier () is a city in Southern California in Los Angeles County, part of the Gateway Cities. The city had 87,306 residents as of the 2020 United States census, an increase of 1,975 from the 2010 census figure. Whittier was incorporated in ...
, completed the process of gaining control of the company. Through the rebuilding of San Francisco after the
1906 San Francisco earthquake,
World War I
World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, the United States, and the Ottoman Empire, with fightin ...
, and numerous floods on the Eel River, the company came into the modern age. By 1920 the company had 1,500 employees and of timberland. Beginning in the same decade, company management began participating in the preservation movement, primarily as a result of pressure from the
Save the Redwoods League
Save the Redwoods League is a nonprofit organization whose mission is to protect and restore coast redwood (''Sequoia sempervirens'') and giant sequoia (''Sequoiadendron giganteum'') trees through the preemptive purchase of development rights ...
in San Francisco. Portions of prior PL holdings including the Rockefeller Forest, the world's largest remaining contiguous
old growth
An old-growth forestalso termed primary forest, virgin forest, late seral forest, primeval forest, or first-growth forestis a forest that has attained great age without significant disturbance (ecology), disturbance, and thereby exhibits un ...
Redwood Forest to survive, now comprises the core of
Humboldt Redwoods State Park. Further developments included recycling of sawdust into the world's first Presto logs.
In 1931, Stanwood Murphy became president of the company. His unique foresight led to a drastic change in practices from the industry standard of clear cutting to a "selective cut" system of logging. This meant that the company would limit cutting to a maximum of 70 percent of the mature trees in a stand, leaving the younger, most vigorous trees to hold the soil and seed a new generation of forest. He also instituted the concept of "sustainable yield," which directed planners to never cut more than the company's forests could replace by new growth in any year. These practices were hailed as revolutionary and he and his direct heirs ran the company in this manner for the next 55 years.
By the 1950s, PALCO efforts to make Scotia a comfortable place to live and raise a family provided the following in the company town: affordable employee housing, stores, a school, a hospital, a skating rink, and a theatre. Under the Murphy family, the company implemented an employee pension plan, and provided free life insurance. By 1961, academic scholarships were also provided to students who were children of company employees. In 1975, PALCO was listed on the
New York Stock Exchange
The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed ...
.
Late 20th century
By the 1980s, this huge lumber operation had absolutely no debt, holding a partially diversified portfolio that included a high-rise building in San Francisco and lucrative welding operation in the San Francisco Bay Area, all derived from the company's 100-year-plan based on sustained yield directed cutting and profits carefully spent to protect cash flow. These long-term plans consequently and purposely led to a relatively low profit annually, which unwittingly were about to make the company vulnerable to "new" acquisition practices from Wall Street. The last Murphy to manage the company under these circumstances, Warren Murphy, reflected on what it was like to run such a stable enterprise with sound environmental practices: "We were the good guys. It was fun, it was easy—it was a great life."
1985 hostile takeover
On September 30, 1985, the venerable Pacific Lumber Company, having maneuvered through more than a century of business peaks and valleys, was taken over as a result of stock purchases culminating on September 27, 1985. The Murphy family (the largest minority stock holders at the time) and countless previous stockholders, mostly company employees, were relieved of their stock as a result of a hostile takeover by
Charles Hurwitz
Charles Edwin Hurwitz (born 1940) is an American businessman and financier known for his role in the 1980s savings and loan crisis, and his takeover of Pacific Lumber Company, a logging company active in Humboldt County, California.
His other hol ...
and his Maxxam, Inc. corporation of Texas.
On February 26, 1986, the day after the completed takeover, Warren Murphy resigned, turning over the company to
John A. Campbell, a man who had been one of his executive vice presidents.
However, despite indisputable changes in the tenor and management of the company, its last major holding of contiguous old growth forest was ultimately preserved as environmental groups and various auspices of government worked to seek a deal that inevitably led to the creation of the
Headwaters Forest
The Headwaters Forest Reserve is a group of old growth coast redwood (''Sequoia sempervirens'') groves in the Northern California coastal forests ecoregion near Humboldt Bay of the U.S. state of California. Comprising about , it is managed by t ...
in 1999 in exchange for $480 million in taxpayer money.
Clearcutting introduced under Maxxam
Between a desire to turn a higher profit and the need to start paying off the debt incurred from acquiring Pacific Lumber, Hurwitz's Maxxam replaced the
sustainable growth
Sustainable development is an organizing principle for meeting human development goals while also sustaining the ability of natural systems to provide the natural resources and ecosystem services on which the economy and society depend. The desi ...
policy of the previous owner-managers (primarily the Murphy family) with one of
clearcutting
Clearcutting, clearfelling or clearcut logging is a forestry/ logging practice in which most or all trees in an area are uniformly cut down. Along with shelterwood and seed tree harvests, it is used by foresters to create certain types of fore ...
.
Protests and resistance
On May 24, 1990, a bomb planted in the car of
Earth First!
Earth First! is a radical environmental advocacy group that originated in the Southwestern United States. It was founded in 1980 by Dave Foreman, Mike Roselle, Howie Wolke, Bart Koehler, and Ron Kezar. Today there are Earth First! groups around ...
activist
Judi Bari
Judith Beatrice Bari (1949–1997) was an American environmentalist, feminist, and labor leader, primarily active in Northern California after moving to the state in the mid-1970s. In the 1980s and 1990s, she was the principal organizer of Ear ...
exploded, sending her and fellow activist Darryl Cherney to the hospital.
Judi and Darryl were on their way to a music and speaking event on the
UC Santa Cruz
The University of California, Santa Cruz (UC Santa Cruz or UCSC) is a public land-grant research university in Santa Cruz, California. It is one of the ten campuses in the University of California system. Located on Monterey Bay, on the edge ...
campus, part of an organizing tour for
Redwood Summer Organized in 1990 by Earth First! and the Industrial Workers of the World, Redwood Summer was a three-month movement of environmental activism led by Judi Bari aimed at protecting old-growth redwood (''Sequoia sempervirens'') trees from logging by ...
, which sought to inform the wider public about the tragedy unfolding in the Redwood Empire.
That explosion was a milestone of forest activism in the redwoods and elsewhere. The bomber was never identified. Oakland police and the FBI initially accused Bari and Cherney with transporting an explosive device under the driver's seat of her own car; but Alameda County prosecutors dropped the case for lack of evidence a few months later.
A lawsuit filed by Judi against the FBI for violation of Constitutional rights was ultimately successful in 2002, vindicating Darryl and Judi, but coming five years after Judi's untimely death from breast cancer at the age of 47.
On September 17, 1998,
David Chain, an Earth First! activist was struck by a falling tree while trying to stop logging in Pacific Lumber property. He was killed instantly and died of massive head trauma. In response to his death, a Pacific Lumber Co. spokesperson said their logging crew did not see anybody in the area and were unaware of Chain's presence. Earth First! said that the loggers had been deliberately felling huge trees, in a perpendicular manner rather than downhill,
in the protesters' direction. One of the protesters also noted that the tree fellers were fully aware that they were there, as the activists had been ''"yelling at them, walking towards them, telling them
'Don't fell this tree'"''.
On a videotape supplied by Earth First!, Arlington Earl Ammons, the 52-year-old logger responsible for felling the tree that caused Chain's death can be heard shouting expletives and threatening the protesters.
Beginning of a new millennium
The company filed for bankruptcy protection in January 2007. A Texas bankruptcy court considered reorganization options early in 2008. On June 6, 2008 the judge preliminarily decided to confirm the Mendocino Redwood Company option for reorganization and signed the order on July 8, 2008. The company's bond holders attempted to appeal, but on July 24, the appellate court in Louisiana refused to hear the case. Timber note holders stated that this will mean the Mendocino Redwood Company/ Marathon plan will be able to go forward, and many agree that any future court will be unlikely to undo it.
Railroads
![CA Fortuna 297495 1944 62500](https://upload.wikimedia.org/wikipedia/commons/d/d7/CA_Fortuna_297495_1944_62500.jpg)
Pacific Lumber Company incorporated the Humboldt Bay and Eel River Railroad on 17 November 1882 to transport lumber from the Scotia sawmill to
Humboldt Bay for loading aboard ships. The railway was completed across the
Scotia Bluffs
Scotia Bluffs form a 2-mile (3-kilometer) series of gray sandstone cliffs along the north bank of the Eel River near Rio Dell, California.
Geology
The course of the lower Eel River changes from northeasterly to westerly as it encounters the res ...
to
Alton, California
Alton (formerly, Hansen) is an unincorporated community in Humboldt County, California. It is located south-southeast of Fortuna, at an elevation of 62 feet (19 m). Alton is located along U.S. Route 101 and State Route 36. The ZIP Code is 9554 ...
on 20 August 1885 where connection was made with the
Eel River and Eureka Railroad
The Eel River and Eureka Railroad company was organized on November 14, 1882, by a group of Eureka businessmen led by John M. Vance (b. Nova Scotia October 1, 1821 – d. January 1892). One of the other founders of the line was William Carso ...
for the remainder of the distance to Humboldt Bay. Rails were extended southward up the Eel River from Scotia to bring logs into the sawmill.
Atchison, Topeka and Santa Fe Railway
The Atchison, Topeka and Santa Fe Railway , often referred to as the Santa Fe or AT&SF, was one of the larger railroads in the United States. The railroad was chartered in February 1859 to serve the cities of Atchison, Kansas, Atchison and Top ...
merged the Pacific Lumber Company railway into their subsidiary
San Francisco and Northwestern Railway on 15 May 1903, although Pacific Lumber Company retained
timber rights
Lumber is wood that has been processed into dimensional lumber, including beams and planks or boards, a stage in the process of wood production. Lumber is mainly used for construction framing, as well as finishing (floors, wall panels, wi ...
and the ability to use the line for their logging operations. The railway became part of the
Northwestern Pacific Railroad
The Northwestern Pacific Railroad is a regional shortline railroad utilizing a stretch of the 271 mile mainline between Schellville and Windsor with freight and Sonoma–Marin Area Rail Transit (SMART) commuter trains. Formerly, it was a reg ...
on 8 January 1907.
Pacific Lumber Company built
flatcar
A flatcar (US) (also flat car, or flatbed) is a piece of rolling stock that consists of an open, flat deck mounted on a pair of trucks (US) or bogies (UK), one at each end containing four or six wheels. Occasionally, flat cars designed to carry ...
s from wood and maintained a fleet of locomotives for moving logs from the woods into the mill and for
switching cars for loading or unloading at the sawmill. Diesels replaced steam locomotives in 1955. Log trains of wooden flat cars ran to the Scotia mill until 1976 from a log deck in
Carlotta, California
Carlotta is an unincorporated community in Humboldt County, California. It is located southeast of Fortuna, at an elevation of , about east of US Route 101 on California State Route 36.
History
Carlotta is named after Carlotta Vance, daughte ...
. Company switchers were stationed at Scotia until Northwestern Pacific Railroad discontinued service.
Locomotives
Environmental issues
Under pressure from environmental activists, the company considered selling 6,000 acres (24 km²) of mostly old growth
redwoods
Sequoioideae, popularly known as redwoods, is a subfamily of coniferous trees within the family Cupressaceae. It includes the largest and tallest trees in the world.
Description
The three redwood subfamily genera are '' Sequoia'' from co ...
for $300 million to protect the
marbled murrelet,
spotted owl
The spotted owl (''Strix occidentalis'') is a species of true owl. It is a resident species of old-growth forests in western North America, where it nests in tree hollows, old bird of prey nests, or rock crevices. Nests can be between high a ...
, and other old growth dwellers. As required by regulatory authorities, buffer zones have been further developed around rivers to prevent
erosion
Erosion is the action of surface processes (such as water flow or wind) that removes soil, rock, or dissolved material from one location on the Earth's crust, and then transports it to another location where it is deposited. Erosion is dis ...
and maintain animal habitats, but the Eel River, the region's major waterway, has been considerably damaged as a result of more than 150 years of logging activity, not all of which is the result of PALCO operations.
In 1999 PALCO agreed to American activist
Julia Butterfly Hill
''Sequoia sempervirens'' ()''Sunset Western Garden Book,'' 1995:606–607 is the sole living species of the genus '' Sequoia'' in the cypress family Cupressaceae (formerly treated in Taxodiaceae). Common names include coast redwood, coastal ...
's requests to create a buffer zone around a 600-year old-growth redwood named
Luna
Luna commonly refers to:
* Earth's Moon, named "Luna" in Latin
* Luna (goddess), the ancient Roman personification of the Moon
Luna may also refer to:
Places Philippines
* Luna, Apayao
* Luna, Isabela
* Luna, La Union
* Luna, San Jose
Roma ...
in exchange for leaving the tree, as she had been living in it for just over two years. Though someone vandalized the tree during the process, it survives to the present.
In 2003, the Company was sued civilly, by the District Attorney of Humboldt County, for fraud and violations of the California Business and Professions Code. The suit was predicated on the allegation that PALCO had affirmatively represented that its timber operations would have a similar environmental impact across all of its land holdings, when in fact there were wide variances and effects on differing watershed environments. The suit was ultimately dismissed by a California Superior Court Judge, but was later appealed to the California Court of Appeal. In January 2008, the California court of Appeal for the 1st district upheld the trial court's dismissal of the litigation, and the suit is for all practical purposes over. During the pendency of this litigation MAXXAM filed for Bankruptcy. Reports indicate that the family that owns the GAP Stores who are already investors in timber lands in Mendocino county, just south of Humboldt county have submitted a proposal to take over PALCO to the Bankruptcy court in Corpus Christie, TX. Environmentalists hailed the move as being a vast improvement on the increased logging approach by Charles Hurwitz and MAXXAM.
Notes
References
* Harris, David. ''The Last Stand: The War between Wall Street and Main Street over California's Ancient Redwoods''. San Francisco: Sierra Club Books, 1997. .
External links
North Coast Journal€”at least 380 articles on the developments within and surrounding PALCO.
San Francisco Chronicle€”multiple stories and editorials related to PALCO.
Pacific Lumber's environmental recordCritique of PALCO's environmental program
{{DEFAULTSORT:Pacific Lumber Company
*
Companies based in Humboldt County, California
Defunct California railroads
Logging railroads in the United States
Defunct companies based in California
Predecessors of the Northwestern Pacific Railroad
Railway companies established in 1863
Railway companies disestablished in 1903
American companies established in 1863
Defunct forest products companies of the United States
1863 establishments in California
1903 disestablishments in California
American companies disestablished in 2008
2008 disestablishments in California