3. SierraPine's Application

SierraPine is a California limited partnership headquartered in Roseville, California. It is a family-owned producer of a variety of composite panel products, including medium-density fiberboard (MDF), particleboard and moulding. SierraPine operates nine plants, three of which are located in California.

The Rocklin facility, a division of SierraPine, produces MDF and thin MDF, 84% of which is ultimately used in California. According to the application, the facility is the last producer of MDF and thin MDF in California. The manufacturing process employed by the facility recycles over 200,000 tons of wood waste a year. The application states that the facility employs more than 200 persons and contributes $60 million a year to the local and state economy.

According to the application, the production of MDF is a low margin business that involves substantial energy costs. The product manufactured at Rocklin competes in a commodity market with MDF manufactured by competitors outside of California that have lower energy costs. Applicant states that the imposition of the DA CRS resulted in energy cost increases at Rocklin that the division was unable to pass along and unable to absorb within an already thin profit margin. Due to these increases, the application states that the Rocklin facility cannot continue to operate and will face certain closure unless the relief authorized by Section 367.3 is granted.