July 22, 2021

A Tempest over Moosehead Lake

Posted on July 22, 2021 by Jerry Reid

If you’ve never been to Moosehead Lake in northwestern Maine, you really should go.  It’s a place of spectacular and unspoiled natural beauty.  The lake is 48 miles long and 20 miles wide, surrounded by mountains.  Jutting up from the middle of the lake is Mt. Kineo, with a shear precipice of dark, volcanic rock that was prized by Native Americans for tool-making.  Henry David Thoreau began two of his trips to the North Woods on Moosehead Lake with his Penobscot Indian guides. 

The Moosehead region has a wild and enchanted feeling to it.  It’s iconic.  And as is true for such places, it generates intensely strong feelings, not just among the hearty people who live and work there, but also among lots of others who feel a connection to it because of what they experienced there or for what it represents to them.  

It is also an area facing serious economic challenges.  For most of Maine’s history, the vast forests of the Moosehead region were owned by the world’s largest paper companies.  These timberlands supplied pulp to the mills, and the landowners allowed public access to the woods for hunting, fishing, and outdoor recreation.  In the late 1990s, Maine’s paper industry began to decline.  The mill operators started selling off their landholdings, including to Real Estate Investment Trusts (REITs) that were concerned less with growing a reliable supply of wood, and more with maximizing return on investment. 

In 1998, Plum Creek Timber Co. purchased more than 900,000 acres of Maine forest, including more than 400,000 acres surrounding Moosehead Lake.  Plum Creek was new to Maine, but its reputation preceded it.  Once a timber management company, Plum Creek had reorganized into a REIT, and had a recent track record of acquiring large tracts of commercial timberland in Washington and Montana, and converting the most valuable portions into exclusive resort and residential developments. 

There was little doubt that Plum Creek had similar plans for its prized new holdings in Maine, but the land was zoned for forestry, and therefore would have to be rezoned before any development could occur.  That rezoning was the purview of Maine’s Land Use Regulation Commission (LURC), the planning and zoning authority for 10,000,000 acres of the State without municipal government, known as Maine’s “unorganized territory.” 

Plum Creek filed its petition to rezone in 2005, igniting one of the most contentious regulatory proceedings in the State’s history.  The proposal was for a 30-year “concept plan” – a form of prospective zoning designed to discourage sprawl, focus development in those areas where it’s most appropriate, and ensure the protection of fragile resources.  To achieve these objectives, concept plans offer landowners development rights beyond what generally applicable rules allow, while requiring in return substantial conservation and other public benefits, beyond what rules would otherwise require.  The approval of a concept plan merely rezones land, but does not act as a development permit or the equivalent.  Plum Creek’s plan called for nearly 1,000 house lots, most of which were proposed for the shoreline of Moosehead Lake or some of the other remote ponds and lakes within the roughly 400,000-acre plan area, as well as two large resorts.  For conservation, Plum Creek proposed a series of shoreline conservation easements that could add up to 11,000 acres, but that were contingent on future approval of development permits for the associated resorts and residential subdivisions. 

LURC’s review of the proposal was painstaking.  The agency’s statute prescribed a novel process with both adjudicatory and legislative elements.  LURC held an adjudicatory hearing to create an evidentiary record that it would use to decide whether and how it should exercise its discretion to rezone the land – ultimately a legislative act.  Twenty-six parties intervened, including regional and national NGOs.  The formal hearings, repeatedly interrupted by protesters, lasted four weeks, though the full proceeding lasted more than two years. 

LURC determined that Plum Creek’s proposal was seriously flawed, calling for too much development in the wrong places, and with too little conservation offered under problematic terms.  Rather than denying the petition, however, the agency seized the opportunity to create a comprehensive conservation and development plan for the region, and instructed its staff to draft amendments that would address the deficiencies.  LURC’s final concept plan allowed for resort or residential development in nine development zones comprising a total of 16,000 acres, while requiring perpetual conservation in 392,500 surrounding acres.  Significantly, the agency re-wrote the operative conservation easements to include rigorous terms, required an ample endowment to ensure their enforcement, and made recording of the easements a threshold condition of rezoning.  The easements permitted commercial forestry to continue in accordance with the certification standards of the Sustainable Forestry Initiative.  LURC’s decision locked in the conservation benefits and capped potential development, but the extent of actual development was left to the mercy of market forces.  Most were satisfied with the outcome, although a few committed opponents criticized it as a sell-out that would lead to the desecration of one of Maine’s sacred places.  All agreed the concept plan would be transformational for the region, but there was bitter disagreement as to how.

What happened – and didn’t happen – following the concept plan’s 2009 approval is remarkable.  First, the market for high-end, second homes and resorts five hours from Boston never materialized as the country struggled to emerge from recession.  Plum Creek was then acquired in 2016 by Weyerhauser, whose focus is more traditional timberlands management than real estate development.  In 2020, Weyerhauser did what would have been inconceivable 15 years earlier.  Abandoning any intention to act on the development rights that Plum Creek fought so hard to secure, it petitioned to terminate the concept plan in order to return the development zones to their prior designation – the far less lucrative zoning classification that permits commercial forestry but precludes development.  That petition was approved in a business-like meeting free from any of the overheated rhetoric that characterized the original proceeding. 

With the dust now settled, the predictions of the region’s transformation have never come to pass, both for better and worse.  A world class conservation framework now protects the landscape, but the economic benefits that plan proponents were counting on from the build out of the development zones have never been realized.  Today the region continues to struggle to sustain itself on the same combination of commercial forestry and outdoor recreation that it relied on before Plum Creek proposed its rezoning.  In the end, the concept plan defied all projections – neither environmental ruination nor economic salvation.  Who would have guessed?

Disclosure:  The author served as counsel to Maine’s Land Use Regulation Commission during the 2009 rezoning proceeding and in litigation challenging the outcome.