FILE - In this Feb. 6, 2013 file photo, President Barack Obama points towards REI CEO Sally Jewell as he announces that he is nominating her as the next interior secretary replacing outgoing Interior Secretary Ken Salazar, in the State Dining Room of the White House in Washington. (AP Photo/Pablo Martinez Monsivais, File)
Friday, March 08, 2013 4:44 pm
Interior pick puts outdoor industry in spotlight
By PAUL FOY and NICHOLAS RICCARDIAssociated Press
Jewell, the 57-year-old chief of Recreational Equipment Inc., represents a new face for a cabinet post more often associated with ranching or oil, gas and mining development. The fact that a mountain-climbing CEO of an outdoors company is President Barack Obama's nominee underscores a new reality in Washington and beyond: the growing influence of outdoor recreation as a political and economic force.
"It's a total game-changer - a recognition of changes in how public lands are used," said Peter Metcalf, president and CEO of Salt Lake City-based Black Diamond Inc., a maker of ski and climbing gear and apparel. "Politics in Washington have finally caught up with reality."
While past interior secretaries have ranged from conservationists, like former Arizona Gov. Bruce Babbitt, to allies of industry like Reagan's first Interior Secretary James G. Watt, they always have been challenged by the competing forces that want to use the federal government's vast lands. That tension doesn't figure to ease under Jewell, who faced her first Senate hearing Thursday and is expected to be confirmed in coming weeks.
Critics complain that the outdoor industry has worked to lock up valuable lands and stymie development in the West. Though oil and gas trade groups aren't opposing Jewell, the nomination of a woman who has a led a recreation-focused company with 128 stores in 31 states alarms some who argue that she might favor her own industry over others.
Rep. Rob Bishop, R-Utah said the recreation industry is "a special interest group like any other .... They have clearly wanted their industry to have a primary position on certain pieces of land."
At Thursday's hearing, Jewell cited federal statistics showing that the Interior Department generated more than $12 billion in revenue from energy production last year, and that visitors to national parks generated an estimated $30 billion in economic activity.
"These are impressive numbers. They underscore the important balance that the Department of the Interior must maintain to ensure that our public lands and waters are managed wisely, using the best science available, to harness their economic potential while preserving their multiple uses for future generations," she said.
Jewell, who also has experience in the oil industry and as a banker, already has been tested with demands as she prepares to take over the department, which manages 780,000 square miles of public lands, including the national parks.
Alaska Sen. Lisa Murkowski threatened to hold up Jewell's nomination if the Obama administration refuses to approve a road to an all-weather airport across a wildlife refuge in the Aleutian Islands. Murkowski called Jewell into her Washington office Feb. 27 on the demand, but said she's expecting departing interior secretary Ken Salazar to give the approval before he leaves office.
It wasn't long ago that that the notion of the outdoors industry holding major political clout would have been difficult to imagine.
"We've always thought the outdoor sector was important. It's just getting others to recognize it that was the challenge," said Sue Rechner, chief of Confluence Watersports, a Greenville, S.C., maker of Mad River canoes and other watersports brands.
Outdoor executives acknowledge they were somewhat naive when they started in politics. They first tried to lobby members of Congress by giving ice-ax awards - that didn't cut it, said Metcalf, one of the industry's most active and passionate voices.
"Some of the feedback we began to get back was, `By the way, this is Washington, D.C. Money talks. Nice to hear from you, but I got a campaign to run,'" he said. "So we began making contributions. It was clear if there wasn't any money behind it, we were compromising ourselves."
Industry officials say Americans spend $646 billion a year on outdoor gear and apparel, off-road vehicles and travel and services, creating 6.1 million professional and seasonal jobs. Many American brands dominate the global marketplace for outdoor equipment.
In Washington, the 4,000-member Outdoor Industry Association tripled its PAC contributions in 2012 to nearly $90,000, according to data compiled by opensecrets.org. The industry spends around $300,000 a year on lobbying, but says it didn't push for Jewell's nomination and that she earned it on her own.
In Utah, the OIA pressured the state's Republican governor to treat outdoor recreation seriously by threatening to pull a lucrative trade show out of Salt Lake City. They have helped fund nonprofits that push for increased land preservation, sometimes butting heads with energy groups seeking to drill on federal lands.
"This is an economic engine, not just a bunch of guys trying to protect the land," said Mike Reberg, district director for Rep. Jim Matheson, D-Utah. "They created an economic perspective on why this stuff is important."
Lobbying disclosures show the OIA's leading issues are protecting wilderness lands and full funding for the Land and Water Conservation Act, which steers money from offshore oil leases to recreation programs. It has teamed up with other industry players to push for a repeal of the 1930s tariff on imported shoes.
"Our industry is often overlooked because of how diverse and broad it is. It's not a normal economic sector," said Frank Hugelmeyer, OIA's president. "We're a horizontal industry that touches many traditional economic sectors."
Beyond her executive experience, it was Jewell's work on the board of the National Parks Conservation Association and for President Barack Obama's "America's Great Outdoors Initiative" brought her leadership to the attention of the White House.
"She knows the link between conservation and good jobs," Obama said at a White House ceremony Feb. 6. "She knows that there's no contradiction."
Jewell is inspirational, "mission-driven" and a consensus builder who nearly doubled REI's revenues to $1.8 billion since joining REI in 2000 and will raise the profile of the industry, said company chairman John Hamlin, managing partner of the private-equity firm Bozeman Limited Partnership.
Among the issues Jewell will need to navigate is the collision between a record-setting energy boom - which has led to sharply increased drilling over the past decade - and the desire of western communities to lure tourists and information-age workers who want to be able to play outdoors, using the gear the industry makes.
Kathleen Sgamma, vice president of government and public affairs for the Western Energy Alliance, said she's baffled at the hostility to energy exploration among the outdoor recreation industry.
"They're not transporting their products via windmills," she said. "Their customers wouldn't be able to use all that gear in the mountains without driving in their cars."
Bishop complained that REI has pushed for America's Redrock Wilderness Act, a bill that has languished in Congress for years without action because of the Utah delegation's opposition. It also helped fund nonprofits who sued to stop the Bush administration's award of 77 oil and gas leases on Utah land in 2008. He scoffed at those who argue that the West can prosper from the recreation economy.
"Recreation is a great element but it's only one of the elements you need," Bishop said. "It is extremely volatile. You need a good industrial sector. You need a good manufacturing sector. You need a good mining sector."