AF&PA on the Issues

Our industry, employing nearly 900,000 men and women, is one built on sustainable principles:
producing recyclable products from a renewable resource. American Forest & Paper Association
(AF&PA) members manufacture and provide essential products used in daily lives of people
across the country and around the world; products playing an important role in literacy, education,
hygiene, food safety, product marketing and protection, and home and office construction. We
support market-based policies and regulations that foster economic growth, job creation, and
international competitiveness in this vital sector. Public policies are most effective when they
meet the environmental concerns, economic needs, and societal expectations of our diverse
communities.


Air Regulations

AF&PA member companies have invested billions of dollars to improve our performance and air
quality, including a 23 percent reduction in emissions of nitrogen oxide (NOx) and 42 percent for
sulfur dioxide (SO2) by our pulp and paper facilities since 2000. Unfortunately, the industry faces
challenges from recently released and expected new regulatory proposals – driven by lawsuits
or petitions under the Clean Air Act – that together could impose roughly $14 billion in new
capital obligations on the industry over the next 10 years. Business uncertainty often continues
even after a rule is published due to challenges in court. Some provisions of a given law may be
overturned even after compliance investments have been made, only leading to more cost and
confusion.

Biomass for Renewable Energy

The paper and wood products manufacturing industry is the nation’s leading producer and user
of carbon-neutral renewable biomass energy. Government policies that pick winners and losers
by mandating a particular use for a raw material or fuel are misguided and should be avoided.
AF&PA supports policies that rely on free markets - rather than mandates and incentives - to
promote competition and innovation in the development of renewable energy.
Woody biomass is an essential raw material for value-added forest products, such as paper,
packaging, wood products, wood-based chemicals, and other innovative wood-based products.
On average, about two-thirds of our industry’s total energy demand is met through carbon
neutral biomass, and some of our renewable electricity is sold to the grid. We also account
for 33 percent of the electricity generated by the manufacturing sector using highly efficient
cogeneration systems.

Carbon Neutrality of Biomass Energy

Paper and wood products manufacturers use biomass residuals from sustainable forestry
operations to produce energy, providing significant carbon reducing benefits to the environment.
AF&PA urges policymakers to continue to recognize our industry’s unique use of biomass as
carbon neutral.

As forests grow, trees remove CO2 from the atmosphere and convert it into organic carbon. Trees
release the stored carbon when they die, decay, or are combusted, thus completing the carbon
cycle. On average about two-thirds of our energy comes from biomass, which takes advantage
of energy value that would otherwise be lost to the atmosphere. The use of biomass in the
paper and wood products manufacturing industry provides enormous greenhouse gas (GHG)
reduction benefits, removing the emission equivalent of 40 million cars from the atmosphere.
On July 12, 2013, the D.C. Circuit Court of Appeals vacated EPA’s Deferral Rule of 2011, stating
EPA failed to adequately justify the temporary delay, but the court left the door open for EPA to
issue permanent regulations distinguishing biogenic CO2 from other emissions.

In June, 2014, the U.S. Supreme Court held that EPA retains some, but not all, of its authority to regulate GHG emissions from sources subject to Clean Air Act permitting program. For sources subject to PSD/Title V permits for conventional pollutants anyway, EPA can regulate their GHG emissions.
The ruling underscores the need for EPA to complete its accounting framework for biogenic carbon emissions and provide clarity that recognizes the GHG reduction benefits of biomass energy. Until the Accounting Framework is issued, EPA will continue to regard CO2 emissions from biomass energy like fossil fuel.

Illegal Logging

AF&PA has been a strong proponent of international efforts to suppress illegal logging and trade.

AF&PA played an active role in a coalition of forest products industry, environmental and labor
groups to advocate for passage of the 2008 amendments, because trade in illegally sourced fiber
is a serious detriment to the industry’s sustainability, the environment and the global economy. An
AF&PA commissioned study estimated that illegal logging cost the U.S. forest products industry
some $1 billion annually in lost export opportunities and depressed U.S. wood prices.

AF&PA is working closely with a broad consensus coalition that is calling on federal agencies to ensure successful implementation of the law. AF&PA supports adequate funding for the
implementation of the Lacey Act and the phase-in of the declaration requirement to imports of
composite wood products and pulp and paper.

AF&PA is on record in support of administrative clarification that the Lacey Act amendments do
not apply to products imported or manufactured prior to May 2008, and the Lacey Act should not
be enforced against individual consumers.

International Trade and Competitiveness

Exports have been of growing importance for our industry, with paper and wood products exports accounting for more than 15 percent of the industry’s annual total sales. In 2013, U.S. exports of forest products reached $31.3 billion, consisting of $22.3 billion in paper and wood pulp exports, and $9 billion in exports of wood products.

AF&PA supports free and fair trade. In an increasingly globalized market, it is critical for the U.S.
paper and wood products manufacturing industry to achieve unrestricted access to international
markets and level the playing field among international competitors by eliminating both tariff and
non-tariff barriers. AF&PA supports bilateral, regional and multilateral trade agreements that offer
substantive economic benefits to U.S. forest products companies and their workers. Specifically,
we support the current negotiations of the Trans-Pacific Partnership Free Trade Agreement,
which will establish a strong platform for achieving trade liberalization in the fast growing Asia-
Pacific region.

AF&PA also supports the launch of free trade negotiations with the European Union, called
the Transatlantic Trade and Investment Partnership. This trade deal provides an opportunity
to eliminate tariff and non-tariff barriers and regulatory impediments to trade in one of the top
export markets for U.S. forest products. To successfully complete these free trade agreements
to the benefit of U.S. business, AF&PA supports the congressional consideration and enactment
of Trade Promotion Authority.

Paper Recycling

More than 63 percent of paper consumed in the U.S. was recovered for recycling in 2013. The
annual paper recovery rate in the U.S. has nearly doubled since 1990. By weight, more paper
is recovered from municipal solid waste streams than glass, plastic, and aluminum combined,
according to the EPA. Recovering paper extends the useful life of fiber and saves valuable
landfill space. Paper recycling is widely accessible, with 87 percent of Americans having access to community curbside and/or drop-off paper recycling programs. The existing voluntary, marketbased
paper recovery system fuels innovation, creates lasting infrastructure, and has allowed
the paper recycling success we are realizing. 

Postal Reform

The U.S. Postal Service (USPS) is the essential component of a $1 trillion mailing industry
that employs about 8 million Americans in large and small business enterprises as diverse as
advertising, printing, paper manufacturing, publishing, and financial services. Approximately
one-third of printing and writing paper demand is delivered through the mail system. The USPS
is facing unprecedented challenges to adapt to the evolving nature of how people communicate
and conduct business.

Only Congress, through comprehensive postal reform legislation, can provide the necessary tools
that will ensure mail is an affordable and effective option that meets the changing communication
and business transaction needs of customers. Postal reform legislation must recognize that
rate increases above inflation and reductions in service will drive customers away and further
accelerate the decline in mail volume.

AF&PA supports legislative measures that allows for long-term cost reductions and new revenue
sources, relieves USPS of unfair financial obligations, minimizes postage rate increases on First
Class or Standard Mail, and satisfies the service needs of the nation.

Promoting Access to Paper Options for Government Programs

AF&PA supports policies that recognize paper-based communications are critically important
for millions of Americans. Increasingly, taxpayers are being denied the option to receive
federal services and communications such as social security documents, tax documents, and
savings bonds in a paper format. The government’s move to digitize all forms of communication
disadvantages nearly 30 percent of American households without Internet access, 45 percent of
seniors who do not own a computer, and 8 percent of the population who choose to not maintain
a bank account.

AF&PA believes people should be able to choose the manner in which they receive information
and services from the federal government. In a recent survey, 72 percent of respondents said the
government should continue to offer important documents and records in paper form. Millions of Americans simply cannot access information in electronic formats. Paper and digital formats can
be complementary; those who wish to receive paper-based communications and documentation
should have that choice and not be forced to digital delivery or forgo the information or service.


Sustainability

AF&PA’s comprehensive sustainability initiative - Better Practices, Better Planet 2020 - includes
six measurable goals that focus on increasing paper recovery for recycling; improving energy
efficiency; reducing greenhouse gas emissions; promoting sustainable forestry practices;
improving workplace safety; and reducing water use. Our members have long been good
stewards of our planet’s resources, and this initiative shows our proactive approach to the longterm
success of our industry, our communities, and our environment.

Tax

AF&PA supports a federal tax system that promotes economic growth, job opportunities, and
the competitiveness of U.S.-based businesses. We believe the tax code should provide a level
playing field for business activity and avoid picking “winners and losers” among economic players.

Transportation

AF&PA supports making critical improvements to America’s transportation efficiency by enacting
H.R. 612, the Safe and Efficient Transportation Act of 2013, to increase the maximum gross
vehicle weight on federal interstate highways from 80,000 pounds to 97,000 pounds with an
additional axle. An increase in the maximum allowable weight of six-axle semi-trailers is an
effective and safe way to increase truck productivity and America’s freight capacity. Technology
improvements and stronger roads and bridges make it safe for each truck to carry more freight.
It would also mitigate the current transportation capacity shortage that inhibits moving raw
materials to mills and products to customers.

AF&PA also supports legislation to reform the Surface Transportation Board to effectively address
rail service challenges for shippers. Nearly one-third of forest products facilities have access to
only one rail carrier, which inherently increases costs. AF&PA also supports legislation removing
current special railroad exemptions from the nation’s antitrust laws.