Verification Assessment Report for: CAR582, Finite … · Robert Turner Audit Standard: ... Tim McAbee, CF, Director - Project Development ... 1.6 FPP Section 4 Appendix A:

C-74 CAR Verif Report Tmpl 06Jul11 Page 1

Verification Assessment Report for:

CAR582, Finite Carbon- MWF Brimstone IFM Project I

in Scott County, Tennessee

Assessed by:

65 Millet St. Suite 201 Richmond, VT 05477 USA

Tel: 802-434-5491 Fax: 802-434-3116

www.rainforest-alliance.org

Carbon Forestry Project Audit Managed by:

United States Regional Office

19 Bridge Square Northfield, MN 55057 Tel: 507-663-1115 Fax: 507-663-7771

Contact Person: Lawson Henderson Email: [email protected]

Report Finalized: Original: April 30, 2014 PIA/Final: December 22, 2014

Audit Dates: May 21 - 23, 2013 August 27 - 28, 2013

Lead Auditor: Lawson Henderson

Audit Team Member(s):

Robert Turner

Audit Standard: CAR Forest Project Protocol v3.2

Reporting Period: October 9, 2007 - August 30, 2013

Verification Code(s): RA- VER-CAR-018337

Project Latitude/Longitude:

36.27222 -84.45472

Project Proponent Contact:

Tim McAbee, CF, Director - Project Development

Project Proponent Address:

435 Devon Park Drive, 700 Building Wayne, PA 19087 USA

http://www.rainforest-alliance.org/


Table of Contents 1 Introduction ............................................................................................................ 4

1.1 Objective ............................................................................................................................................................................... 4 1.2 Scope and Criteria ................................................................................................................................................................. 4

1.3 Project Description ................................................................................................................................................................ 4 1.4 Level of assurance ................................................................................................................................................................. 5 1.5 Findings ................................................................................................................................................................................. 5

2 Audit Methodology ................................................................................................ 5 2.1 Audit Team ........................................................................................................................................................................... 5

2.2 Description of the Audit Process .......................................................................................................................................... 6 2.3 Review of Documents ........................................................................................................................................................... 7 2.4 Interviews ............................................................................................................................................................................ 12

3 Verification Opinion ............................................................................................ 13 APPENDIX A: Field Audit Findings for Improved Forest Management Projects ..... 14

1 Initial Verification Requirements (required for initial verification only) ............ 14 1.1 FPP Section 2.1.2 Project definition ................................................................................................................................... 14

1.2 FPP Section 3.1.1.1: Legal requirement test ....................................................................................................................... 14 1.3 FPP Section 3.2: Project start date ...................................................................................................................................... 15 1.4 FPP Section 3.5: Project implementation agreement .......................................................................................................... 15 1.5 FPP Section 3.8: Project location ........................................................................................................................................ 16

1.6 FPP Section 4 Appendix A: Project area ............................................................................................................................ 16 2 Site visit requirements ......................................................................................... 16

2.1 FPP Section 3.4: Minimum time commitment.................................................................................................................... 17 2.2 FPP Section 3.7: Attestation of title .................................................................................................................................... 17 2.3 FPP Section 3.9: Regulatory compliance ............................................................................................................................ 17

2.4 FPP Section 3.10.1: Sustainable harvesting practices......................................................................................................... 17 2.5 FPP 3.10.1: Change in Forest Owner Landholdings ........................................................................................................... 18

2.6 FPP 3.10.3: Maintenance of standing live carbon pool ...................................................................................................... 18

2.7 FPP Table 10.4: Natural forest management ...................................................................................................................... 18

2.8 FPP Section 6.1.3, 6.2.4, 6.3.3, Appendix A and B: Estimation of actual onsite carbon stocks ........................................ 21 2.9 FPP Section 6.1.4, 6.2.5, 6.3.4, Appendix C: Estimation of actual carbon in HWPs ......................................................... 21 2.10 FPP Section 6: Quantification of Primary Effect .............................................................................................................. 22

2.11 FPP Section 6.1.5, 6.2.6, 6.3.5: Quantification of Secondary Effects .............................................................................. 22 2.12 FPP Section 7.3: Reversal Determination ......................................................................................................................... 22

3 Inventory methodology verification items........................................................... 22 3.1 FPP Table 10.5: Inventory design ....................................................................................................................................... 22 3.2 FPP Table 10.9: Inventory considerations .......................................................................................................................... 24

3.3 FPP Section 9.1.1.1: Inventory of onsite carbon stock requirements ................................................................................. 25 3.4 FPP Section 10.3.5: Verification inventory ........................................................................................................................ 26

4 GHG Assessment Boundary – Calculating Baseline ........................................... 27 4.1 FPP Sections 5.1, 5.2, and 5.3: The appropriateness of the source, sink and reservoir ...................................................... 27

4.2 FPP Appendix A.4: Uncertainty and confidence deduction ............................................................................................... 27 4.3 FPP Section 6.2.2: Special considerations for IFM projects on public lands ..................................................................... 27

5 Modeling Baseline ............................................................................................... 28

5.1 FPP Section 9: Model document ......................................................................................................................................... 28 5.2 FPP Appendix B.1: Model choice and calibration .............................................................................................................. 28 5.3 FPP Sections 3.1.1, 6.1.1, 6.2.1.2, and 6.3.1: Legal constraints ......................................................................................... 28 5.4 FPP Sections 3.1.2, 6.1.1, 6.2.1.3, 6.3.1, Appendix E: Financial constraints ..................................................................... 29 5.5 FPP Appendix B: Silvicultural guidelines .......................................................................................................................... 29 5.6 FPP Sections 6.1, 6.2, and 6.3: Modeling guidelines .......................................................................................................... 30


5.7 FPP Section 9 and Appendix B: Model outputs ................................................................................................................. 30

5.8 FPP Section 6.2.1 Appendix A: Inventory of Onsite carbon stocks (Private land only) .................................................... 30

5.9 FPP Section 6.2.1 Appendix A and F: Compare initial aboveground standing live carbon stocks with the minimum

baseline level (Private land only) .................................................................................................................................................. 31 5.10 FPP Section 6.2.1 (Private land) 6.2.2 (Public land), Appendix B: Baseline carbon stock modeling.............................. 32 5.11 FPP Section 9.1.1: Description of forest project activities ............................................................................................... 32 5.12 FPP Section 6.2.2 Appendix A: Initial forest carbon stock inventory (Public land only) ................................................ 33

6 Harvested Wood Products Estimates ................................................................... 33

6.1 FPP Sections 6.2.1 – 6.2.3, Appendix B and C: Baseline harvest volume ......................................................................... 33 6.2 FPP Section 6.2.3, Appendix C: Long-term storage in wood products .............................................................................. 33 6.3 FPP Appendix C.1: Carbon in harvested wood delivered to mills ..................................................................................... 33 6.4 FPP Appendix C.2: Account for mill efficiencies .............................................................................................................. 34 6.5 FPP Appendix C.3: Wood product classification ............................................................................................................... 34

6.6 FPP Appendix C.3 and C.4: Calculation of in-use and landfill carbon storage .................................................................. 34 6.7 FPP Appendix C.5: Total average carbon storage in wood products over 100 years ......................................................... 34

7 Monitoring Plan ................................................................................................... 35

7.1 FPP Section 8.1: Approval of the monitoring methodology ............................................................................................... 35 7.2 FPP Section 9.1 and 9.4: Whether the monitoring plan provides detailed information related to the collection and

archiving of all relevant data ......................................................................................................................................................... 35

8 Reversal Risk Analysis and Buffer Pool Contribution ........................................ 35 APPENDIX B: Organization Details .......................................................................... 38

Contacts ......................................................................................................................................................................................... 38


1 Introduction The Rainforest Alliance’s SmartWood program was founded in 1989 to certify forestry practices conforming to Forest Stewardship Council (FSC) standards and now focuses on providing a variety of forest auditing services. In addition to being an ANSI ISO 14065:2007 accredited validation and verification body, Rainforest Alliance SmartWood program is also a member of the Climate, Community, and Biodiversity Alliance (CCBA) standards, and an approved verification body with a number of other forest carbon project standards. For a complete list of the services provided by Rainforest Alliance see http://www.rainforest-alliance.org/climate.cfm?id=international_standards. Dispute resolution: If Rainforest Alliance clients encounter organizations or individuals having concerns or comments about Rainforest Alliance / SmartWood and our services, these parties are strongly encouraged to contact the SmartWood program headquarters directly.

1.1 Objective The purpose of this report is to document the conformance of CAR582, Finite Carbon - MWF Brimstone IFM Project I with the requirements of the Climate Action Reserve (CAR). The project was developed by Finite Carbon Corporation, hereafter referred to as “Project Proponent”. The report presents the findings of qualified Rainforest Alliance auditors who have evaluated the Project Proponent’s systems and performance against the applicable standard(s). 1.2 Scope and Criteria

Scope: The scope of the audit is to assess the conformance of Finite Carbon's Improved Forest Management project (CAR582, Finite Carbon – MWF Brimstone IFM Project I) in Scott County, Tennessee against the Climate Action Reserve Forest Project Protocol . The objectives of this audit included an assessment of the project’s conformance with the standard criteria. In addition, the audit assessed the project with respect to the baseline scenarios presented in the project design document. The project covers an area of 4,861 acres. The land is privately owned. The project has a lifetime of 100 years, and has calculated a GHG reduction and/or removal of 252,512 tCO2e over the course of the monitoring period.

Standard criteria: Criteria from the following documents were used to assess this project:

Climate Action Reserve Program Manual, October 26, 2011

Climate Action Reserve Verification Program Manual, December 20, 2010

Climate Action Reserve Forest Project Protocol, v 3.2.; and,

All applicable policy memos issued by the Reserve Materiality: All GHG sinks, sources and/or reservoirs (SSRs) and GHG emissions equal to or greater than 3% of the total GHG assertion unless otherwise defined by the standard criteria. 1.3 Project Description

The MWF Brimstone IFM Project I is an Improved Forest Management (IFM) Project developed and implimented using the Climate Action Reserve (CAR or the Reserve) Forest Project Protocol (FPP Version 3.2). The Project Area is 4,861 acres in size and is located in Scott County, in the northern east/central part of the state of Tennessee in the United States. The primary goal of the project is to generate carbon offset credits by maintaining and increasing additional forest carbon stock in a manner consistent with the objectives of the forest owner, MWF Brimstone Forest Company, LLC. ("MWF Brimstone" or "forest owner"). The project was initiated on October 9, 2007, the effective date of the perpetual conservation easement established on the project area as conveyed to the State of Tennessee. The forest owner has retained Finite Carbon as the project developer. The Property lies within the Appalachian Plateau Physiographic Province. The eastern portion of the property lies at the southern most portion of the Cumberland Mountain Physiographic section while the western portion lies within the Cumberland Plateau section. Many streams originate on the property and most ultimiately drain into the Ohio River to the north via the Cumberland River from the Upper Cumberland River Watershed. The largest water deature on the property is Little Bull Creek. Forest still cover most of the area within the Northern Cumberlands, however human activities such as logging, clearing and fire suppresion have altered the quality of many forests in the region. Coal minning and other forms of natural resource extraction have also played a prominent role with the Northern Cumberlands.

http://www.rainforest-alliance.org/programs/forestry/smartwood/index.html

http://www.rainforest-alliance.org/climate.cfm?id=international_standards


1.4 Level of assurance The assessment was conducted to provide a reasonable level of assurance of conformance against the defined audit criteria and materiality thresholds within the audit scope. Based on the audit findings, a positive evaluation statement reasonably assures that the project GHG assertion is materially correct and is a fair representation of the GHG data and information. 1.5 Findings Throughout the verification, findings were recorded by the audit team as per verification guidance outlined in the CAR Forest Project Protocol and supporting documents. Any nonconformances were identified by the audit team were documented as a Non-conformity Reports (NCRs), and non-material issues identified were recorded as Observations and submitted to the Project Proponent. Prior to verification, all identified NCRs are required to be addressed, and additional evidence is required to be submitted to the audit team as evidence of conformance. All identified NCRs and Observations are recorded in a separate annex to this report titled “List of Findings”. As per the Reserve requirements, this annex is a confidential document, and is not publically available. This annex was shared with the Project Proponent, the Rainforest Alliance audit team, and the Reserve.

2 Audit Methodology

2.1 Audit Team

Overview of roles and responsibilities:

Auditor(s)

Responsibilities

Lead Desk

Review

On-site visit

Climate Specialist

Biodiversity Specialist

Social Specialist

Report Senior Internal Review

Lawson Henderson

Robert Turner

Janice O’Brien

Auditor qualifications:

Auditor(s) Qualifications

Lawson Henderson Carbon Coordinator with Rainforest Alliance. Education: B.S.F. in forest management from University of New Hampshire, 2005. Experience, Forest Management Associate with SmartWood, US Region (2008 to 2012). Chain of Custody Associate with SmartWood, US Region (2007-2008). Forest Land Surveyor for a private forest/civil engineering firm in Western Oregon for two years. Auditor on more than 20 FSC forest management and chain of custody audits and assessments. Lead auditor or auditor on 16 forest carbon projects. Project manager on over 250 forest management and chain-of-custody projects. Completed SmartWood CoC Auditor Training in April 2008, Rainforest Alliance Carbon Verification and Validation Audit Training in March 2009, and SmartWood Lead Forest Management Auditor Training in June 2009. Attended the Climate Action Reserve Lead Verifier Training for the Forest Project, and Urban Forest Project Protocol in September 2010. Completed the ISO Quality Management Systems Lead Auditor Training Course (ISO 9001) in December 2010. ARB Lead Verifier credentials obtained in October 2012. Member of the Society of American Foresters.

Robert Turner Robert brings over 25 years of experience in forest management consulting. The bulk of this experience is with larger landowners and spans a broad range of technical and analytical services, often related to forest inventory and management planning, mensuration, growth and yield modeling, financial modeling, information and decision support systems, and spatial analysis. Robert’s work has included participation in numerous FCS assessments and audits (as a representative of the landowner). Auditor on 7 carbon projects with both the CAR & VCS standards. ARB Lead Verifier credentials obtained in


October 2012. He has performed carbon feasibility analyses for clients, evaluated the technical feasibility of changes to RGGI IFM rules. Robert has a MS in Forest Management from the University of Vermont and a BS in Finance.

Janice O’Brien Janice has a Master's Degree in Forest Conservation from the University of Toronto and has been with Rainforest Alliance for 8 years. Janice acts as both the Canadian Verification Services and Chain of Custody Associate. She has task managed multiple Carbon methodology assessments, pre-validations, and validation projects in Canada, has completed a training program in GHG Accounting for Forests and participated as an auditor in 7 Carbon Pre-Assessments, and 5 Carbon Validation Projects. Janice is qualified as a CAR & ARB Lead Verifier. She has coordinated approximately 1000 Chain of Custody

audits and assessments, conducted approximately 50 assessments/audits, and

participated in 1 Forest Management Audit. Prior to joining Rainforest Alliance she worked in operational and financial risk management for 13 years.

2.2 Description of the Audit Process Rainforest Alliance submitted a proposal for the CAR Verification of the MWF Brimstone IFM Project I on May 2, 2013, and was selected by the Project Developer - Finite Carbon as the Verification Body. The Reserve's Notification of Verification Activities & Conflict of Interest form (NOVA/COI) was approved by CAR on May 13, 2013. The Service Agreement contract was signed by Finite Carbon on May 14, 2013 and verification activities began on May 17, 2013 starting with the opening meeting "kick off" call. The Audit Team developed the Audit/Sample Plan for the field verification which was submitted submitted to Finite Carbon on May 17, 2013. The field verification of the Project was conducted from May 21 - 23, 2013. The audit team was accomanpied in the field by staff with the project develper - Finite Carbon, and the landowner - MWF Brimstone Forest Company, LLC. The field verification activities consisted of an opening and closing meeting,measurement of 17 forest inventory plots in accordance with the Reserve's sequential sampling guidelines, assessment of the Project Area & forest strata boundaries, and evaluation of the project's conformance with the sustainable harvesting and natural forest management criteria. Following the field verification, the audit team ran their verification data through the CAR sequential sampling workbook. While the analysis showed that the project's inventory was verifiable, the results were above the 10 percent allowance level, and the Project Proponent would be required to apply the appropriate adjustment factor to the Project's credits given the higher uncertainty found. Once the auditors provided their sequential sampling results to the Project Proponent that indicated an adjustment factor to the credits would need to be applied, the Project Proponent conducted a financial analysis to determine if it was in their best interest to conduct a re-inventory of the project area, and establish another contract with Rainforest Alliance for a second site verification. The Project Proponent determined that it was in their best interest to conduct a re-inventory of the project area and contracted with Rainforest Alliance for a second verification site visit. The second site visit was conducted from August 27-28, 2013 using the same audit team. The on-site verification activities were similar to the those carried out during the first site visit, but at the request of the Project Proponent the auditors used the T-test method for verification of the updated forest inventory. Following CAR guidance for the t-test method, a minimum of 8 plots were required to be measured by the verifiers in the the strata with the highest stocking (OH3A). The determination of the minimum of 8 plots was based on the auditor's professional judgement of the Project against the Verification/Evaluation Items in Table 10.5 of the protocol, the appropriate Verification Intensity Multiplier for the Project from Table 10.6, and the resulting Verification Field Intensity as found using Table 10.7 in the Protocol. Ultimately the passing T-test analysis was ran using a total of 9 plots and the auditors found that it passed the two-tailed paired t-test with a score of greater than 80% allowing the auditors to make a determination that the Project’s inventory was sound. Following the second site visit a web based meeting was held between the auditors and the Project Developers. In this meeting the Project Developers demonstrated the modeling approach that was used to project carbon stocks over time, and how they completed the quantification of the project's carbon stocks and GHG assertion. Updated versions of the project documents were provided to the auditors, which were the final documents considered for development of the draft verification report. The draft version of the verification report was submitted to the Project Proponent on November 13, 2013. On November 26, 2013 the Project Proponent submitted updated project documenation and supporting evidnece requested by the Verifiers and a second desk based review was conducted. The Reserve Attestations signed by the landowner however, were not received until April 3, 2104. Upon completion of the second review of the Project, the Verifier's found with a


reasonable level of assurance that the Project was in full conformance with the CAR standards and Forest Project Protocol Verison 3.2, and the draft final version of the verification report and the List of Findings were completed. The draft final verification report and list of findings were provided to the Project Proponent for review and approval on April 8, 2014. Following approval by the Project Proponent the verification report and list of findings underwent Senior Internal Review with Rainforest Alliance which was completed on April 30, 2014. The verification report and list of findings was then submitted to the Reserve for their review ad aproval processon April 30, 2014. Following ongoing negotiations over the Project Impementation Agreement (PIA), the Project Proponent and CAR entered into the PIA on November 10, 2014. The executed and recorded PIA was provided for auditor review, and the verification report was updated accordingly. The updated verification report underwent final Senior Internal Review, was finalized, and submitted to CAR for approval. Following CAR's approval the Project was offically registered.

Location/Facility Date(s) Length of Audit

Auditor(s)

Rainforest Alliance Richmond, VT Office

RJTCo Bristol, VT Office

May 16 - 17, 2013

1.5 days Lawson Henderson

Robert Turner

Brimstone Forest, Scott County, TN May 21 – 23, 2013


Robert Turner



May 27 – August 20, 2013

1.0 day Lawson Henderson

Robert Turner

Brimstone Forest, Scott County, TN August 27 – 28, 2013


Robert Turner



October 11 – November 11, 2013


Robert Turner


RJTCo Bristol, VT Office (Second Review)

November 26 – April 3, 2014


Robert Turner

Remote Location, Senior Internal Review (original)

April 29-30, 2014

1.0 day Janice O’Brien

Rainforest Alliance Richmond, VT Office (PIA review)

December 19, 2014

.25 day Lawson Henderson

Remote Location, Senior Internal Review (final/PIA)

December 22, 2014

.25 day Janice O’Brien

2.3 Review of Documents The following documents were viewed as a part of the field audit:

Ref Title, Author(s), Version, Date Electronic Filename

1 MWF Brimstone IFM Project I (CAR582) Project Design Document, Finite Carbon, May 17, 2013

PDD_CAR582_Brimstone_draft20130517_2.pdf

2 MWF Brimstone IFM Project I (CAR582) Monitoring Calculation Worksheet, Finite Carbon, May 17, 2013

CAR582 Monitoring-Calculation-Worksheet.xlsx

3 MWF Brimstone IFM Project I (CAR582) Town Roads Map, Finite Carbon, May 17, 2013

Appendix A. CAR582_Map_TownsRoads.pdf

4 MWF Brimstone IFM Project I (CAR582) Watercourses Map, Finite Carbon, May 17, 2013

Appendix B. CAR582_Map_Watercourses.pdf

5 MWF Brimstone IFM Project I (CAR582) Topography Map, Finite Carbon, May 17, 2013

Appendix C. CAR582_Map_Topography.pdf

6 MWF Brimstone IFM Project I (CAR582) County-Cities Appendix D. CAR582_Map_CountyCities.pdf


Map, Finite Carbon, May 17, 2013

7 MWF Brimstone IFM Project I (CAR582) Assessment Areas, Finite Carbon, May 17, 2013

Appendix E. CAR582_AssessmentAreas.pdf

8 MWF Brimstone IFM Project I (CAR582) Data Management & Modeling Systems, Finite Carbon, May 17, 2013

Appendix F. CAR582 Data Management and Modeling Systems.pdf

9 MWF Brimstone IFM Project I (CAR582) Baseline Harvest Volumes (5-17), Finite Carbon, May 17, 2013

Appendix G. CAR582 Baseline Harvest Volumes 20130517.pdf

10 MWF Brimstone IFM Project I (CAR582) Baseline Harvest Volumes, Finite Carbon, May 17, 2013

Appendix G. CAR582 Baseline Harvest Volumes.pdf

11 MWF Brimstone IFM Project I (CAR582) Project Inventory Specifications, Finite Carbon, May 17, 2013

Appendix H. CAR582 Project Inventory Specifications 20130514 Proprietary.pdf

12 MWF Brimstone IFM Project I (CAR582) Geo-data-base, Finite Carbon, May 17, 2013

Appendix I.CAR582_Geodatabase.zip

13 MWF Brimstone IFM Project I (CAR582) Full Monitoring Plan, Finite Carbon, May 17, 2013

Appendix J. CAR582 Full Monitoring Plan.pdf

14 MWF Brimstone IFM Project I (CAR582) Baseline Inventory, Growth and Harvest by Year (5-17), Finite Carbon, May 17, 2013

Appendix K. CAR582 Baseline Inventory, Growth and Harvest by Year 20130517.pdf

15 MWF Brimstone IFM Project I (CAR582) Baseline Inventory, Growth and Harvest by Year, Finite Carbon, May 17, 2013

Appendix K. CAR582 Baseline Inventory, Growth and Harvest by Year.pdf

16 MWF Brimstone IFM Project I (CAR582) Harvested Wood Products Calculation Worksheet (5-17), Finite Carbon, May 17, 2013

Appendix L. CAR582 Harvested-Wood-Products-Calculation-Worksheet 20130517.xlsx

17 MWF Brimstone IFM Project I (CAR582) Harvested Wood Products Calculation Worksheet, Finite Carbon, May 17, 2013

Appendix L. CAR582 Harvested-Wood-Products-Calculation-Worksheet.xlsx

18 MWF Brimstone IFM Project I (CAR582) Sampling Error Calculation (5-17), Finite Carbon, May 17, 2013

Appendix M. CAR582 Sampling Error Calculation 20130517.pdf

19 MWF Brimstone IFM Project I (CAR582) Sampling Error Calculation, May 17, 2013

Appendix M. CAR582 Sampling Error Calculation.pdf

20 MWF Brimstone IFM Project I (CAR582) Inventory Spec Final (5-14), Finite Carbon, May 14, 2013

Brimstone No Harvest CARARB project inventory Spec Final 051413.pdf

21 MWF Brimstone IFM Project I (CAR582) Inventory Spec Final (5-18), Finite Carbon, May 18, 2013

Brimstone No Harvest CARARB project inventory Spec Final 051813.pdf

22 MWF Brimstone IFM Project I (CAR582) Inventory Results, Finite Carbon, May 20, 2013

Inventory_Results_20130520.xlsx

23 MWF Brimstone IFM Project I (CAR582) 2010-2011 Tree List, Finite Carbon, May 17, 2013

Tree_Lists_2010_2011.xlsx

24 MWF Brimstone IFM Project I (CAR582) Comparable Harvest Area, Finite Carbon, May 17, 2013

Comparable Harvest Area.pdf

25 MWF Brimstone IFM Project I (CAR582) Comparable Harvest Volumes, Finite Carbon, May 17, 2013

Comparable Harvest Volumes.pdf

26 MWF Brimstone IFM Project I (CAR582) Inventory Audit Summary, May 17, 2013

FC Little Brimstone Audit Summary 2010-2011.pdf

27 MWF Brimstone IFM Project I (CAR582) Inventory Audit Summary (6-18-10), Finite Carbon, May 17, 2013

Finite Carbon Brimstone Inventory Audit Summary through 6-18-10.pdf

28 MWF Brimstone IFM Project I (CAR582) Merchantable Stand Statistics, Finite Carbon, June 15, 2011

Merch Stand Stats 061511.pdf

29 MWF Brimstone IFM Project I (CAR582) CAR Guidance on Species Equations, Finite Carbon, May 17, 2013

Project Guidance Spp. Equations CAR guidance.xlsx

30 MWF Brimstone IFM Project I (CAR582) Conservation CAR582 Other Property Interests – Conservation


Easement, Tennessee Department of Environment and Conservation, October 5, 2007

Easement.pdf

31 MWF Brimstone IFM Project I (CAR582) Mineral Deed, Bass, Berry & Sims (WHS), June 1, 2004

CAR582 Other Property Interests – Mineral Deed.pdf

32 MWF Brimstone IFM Project I (CAR582) Owner’s Policy of Title Insurance, First American Title Insurance Company, February 8, 2012

CAR582 Ownership Interests Documentation A.pdf

33 MWF Brimstone IFM Project I (CAR582) Special Warranty Deed, Tennessee Valley Title Insurance Co., October 5, 2007

CAR582 Ownership Interests Documentation B.pdf

34 MWF Brimstone IFM Project I (CAR582) 2013 FSC Audit Report, Rainforest Alliance, January 3, 2013

Alabama Treasure Forest Association FSC FM audit 13 public.pdf

35 MWF Brimstone IFM Project I (CAR582) Forest Management Plan, Molpus Timberlands Management, LLC, June 2012

BrimstoneForest_ManagementPlan_final.pdf

36 MWF Brimstone IFM Project I (CAR582), FSC Forest Management System for the Tennessee Operations, Molpus Timberlands Management, LLC, April 2012

FoMgtSystem)TNop_final.pdf

37 MWF Brimstone IFM Project I (CAR582) FSC Operational Controls, Molpus Timberlands Management, LLC, May 2012

FSCoperational Controls_final.pdf

Project Documents following the Second Site Visit

1a MWF Brimstone IFM Project I (CAR582) Roads Files, Finite Carbon, August 2013

Brimstone_Rds.zip (8 files)

2a MWF Brimstone IFM Project I (CAR582) CAR Species Equation References, Finite Carbon, Sept 2013

CAR582_SpeciesEquationRefs_09202013.alsx

3a MWF Brimstone IFM Project I (CAR582) Re-inventory specifications, Finite Carbon, August 2013

FINAL Brimstone No Harvest project Inventory Spec Reinventory 080819.pdf

4a MWF Brimstone IFM Project I (CAR582) Re-inventory internal audit results, Finite Carbon, August 2013

Finite Carbon Audit Report1 (1).xlsx

5a MWF Brimstone IFM Project I (CAR582) Request for Missing Species Equation Guidance from CAR, Finite Carbon, August 2013

Finite Carbon CAR582 Request-for-Project-Guidance Species Equations 2013.docx

6a MWF Brimstone IFM Project I (CAR582) Access Database File, Finite Carbon, August 2013

Little_Brimstone_RA.mdb

7a MWF Brimstone IFM Project I (CAR582) Verification Map, Finite Carbon, August 2013

Little_Brimstone_Verification_Maps.pdf

8a MWF Brimstone IFM Project I (CAR582) Private Roads Files, Finite Carbon, August 2013

LymeTN_roads_private_5082008.shp.zip (7 files)

9a MWF Brimstone IFM Project I (CAR582) CAR Species Equations Guidance V2, Finite Carbon, September 2013

Project Guidance Spp Equations CAR guidance_v2.xlsx

10a MWF Brimstone IFM Project I (CAR582) Verification Timeline Email, Finite Carbon, September 2013

Re Brimstone timeline.msg

11a MWF Brimstone IFM Project I (CAR582) Scott County Map, Tennessee DOT, 2002

Scott_County_76.pdf

12a MWF Brimstone IFM Project I (CAR582) Verification Plot Results, Rainforest Alliance, September 2013

Verification_Plot_Results_0924.xlsx

13a MWF Brimstone IFM Project I (CAR582) Fixed Verification Plot Results, Finite Carbon, September 2013

Verification_Plot_Results_0924_fixed.xlsx

14a MWF Brimstone IFM Project I (CAR582) Verification Preparation Spread Sheet, Finite Carbon, August 2013

Verification_Prep_08202013.xlsx

15a MWF Brimstone IFM Project I (CAR582) Harvested CAR582 Harvested-Wood-Products-Calculation-


Wood Products Calculation Worksheet, Finite Carbon, October 2013

Worksheet_20131015.xlsx

16a MWF Brimstone IFM Project I (CAR582) Monitoring Calculation Worksheet, Finite Carbon, October 2013

CAR582 Monitoring-Calculation-Worksheet_20131007.xlsx

17a MWF Brimstone IFM Project I (CAR582) Updated Project Description Document, Finite Carbon, October 2013

PDD_CAR582_Brimstone_draft20131015.pdf

18a MWF Brimstone IFM Project I (CAR582) Updated Appendix F, Finite Carbon, October 2013

Appendix F. CAR582 Data Management and Modeling Systems 20131008.pdf

19a MWF Brimstone IFM Project I (CAR582) Updated Appendix G, Finite Carbon, October 2013

Appendix G. CAR582 Baseline Harvest Volumes 20131007.pdf

20a MWF Brimstone IFM Project I (CAR582) Updated Appendix H, Finite Carbon, October 2013

Appendix H. CAR582 Project Inventory Specifications 20131007 Proprietary.pdf

21a MWF Brimstone IFM Project I (CAR582) Updated Appendix I, Finite Carbon, October 2013

Appendix I. CAR582 Geodatabase 20131015.zip (1 file)

22a MWF Brimstone IFM Project I (CAR582) Updated Appendix J, Finite Carbon, October 2013

Appendix J. CAR582 Full Monitoring Plan.pdf

23a MWF Brimstone IFM Project I (CAR582) Updated Appendix K, Finite Carbon, October 2013

Appendix K. CAR582 Baseline Inventory, Growth and Harvest by Year 20131007.pdf

24a MWF Brimstone IFM Project I (CAR582) Updated Appendix L, Finite Carbon, October 2013

Appendix L. CAR582 Harvested Wood Products Worksheet 20131007.pdf

25a MWF Brimstone IFM Project I (CAR582) Updated Appendix M, Finite Carbon, October 2013

Appendix M. CAR582 Sampling Error Calculation 20131007.pdf

26a MWF Brimstone IFM Project I (CAR582) Assessment Area Analysis, Finite Carbon, October 2013

Assessment Area Analysis 20131014 Proprietary.pdf

27a MWF Brimstone IFM Project I (CAR582) Comparable Harvest Site, Finite Carbon, October 2013

CAR582_Comparable Harvest Site.pdf

28a MWF Brimstone IFM Project I (CAR582) Backwards Growth, Finite Carbon, October 2013

Backwards_)Growth.xlsx

29a MWF Brimstone IFM Project I (CAR582) FVS LP Outputs, Finite Carbon, October 2013

FVS_LB_Outputs.zip

30a MWF Brimstone IFM Project I (CAR582) FVS Text Outputs, Finite Carbon, October 2013

FVS_Text_Outputs.zip

31a MWF Brimstone IFM Project I (CAR582) Re-inventory Plot Level Carbon, Finite Carbon, October 2013

CAR582 Plot_Lvl_C.xlsx

32a MWF Brimstone IFM Project I (CAR582) CAR Missing Species Equations Guidance, Finite Carbon, September 17, 2013

CAR Missing Species Equations Guidance for Brimstone.xlsx

Project Documents for the Second Review

1b MWF Brimstone IFM Project I (CAR582) Final Harvest Wood Calculation Worksheet, Finite Carbon, November 19, 2013

CAR582 Harvested-Wood-Products-Calculation-Worksheet_20131119.xlsx

2b MWF Brimstone IFM Project I (CAR582) Final Monitoring-Calculation-Worksheet, Finite Carbon, November 198, 2013

CAR582 Monitoring-Calculation-Worksheet_20131119.xlsx

3b MWF Brimstone IFM Project I (CAR582) Final Plot Level Carbon, Finite Carbon, November 2013

CAR582 Plot_Lvl_C.xlsx

4b MWF Brimstone IFM Project I (CAR582) Updated Project Description Document, Finite Carbon, November 26, 2013

PDD_CAR582_Brimstone_20131126.xlsx

5b MWF Brimstone IFM Project I (CAR582) NCR Responses, Finite Carbon, November 26, 2013

Round1_FCResponse_20131126.xlsx

6b MWF Brimstone IFM Project I (CAR582) Appendix D, Finite Carbon, November 19, 2013

Appendix D. CAR582_Map_CountyCities 20131119.pdf

7b MWF Brimstone IFM Project I (CAR582) Appendix F, Appendix F. CAR582 Data Management and Modeling


Finite Carbon, November 21, 2013 Systems 20131121.pdf

8b MWF Brimstone IFM Project I (CAR582) Appendix J, Finite Carbon, November 19, 2013

Appendix J. CAR582 Full Monitoring Plan 20131119.pdf

9b MWF Brimstone IFM Project I (CAR582) Appendix L, Finite Carbon, November 19, 2013

Appendix L. CAR582 Harvested Wood Products Worksheet 20131119.pdf

10b MWF Brimstone IFM Project I (CAR582) Baseline Return Interval Worksheet, Finite Carbon, November 18, 2013

Baseline_Return_Interval_Proprietary_20131118.xlsx

11b MWF Brimstone IFM Project I (CAR582) Harvested Cubic Foot Volume (c02e), Finite Carbon, November 2013

Harvested_CuFt_CO2e.xlsx

12b MWF Brimstone IFM Project I (CAR582) Merchantable Height Regressions, Finite Carbon, November 19, 2013

MerchantableHtRegressions_Proprietary_20131119.xlsx

13b MWF Brimstone IFM Project I (CAR582) Site Index Trees Worksheet, Finite Carbon, November 2013

Site_Index_Trees.xlsx

14b MWF Brimstone IFM Project I (CAR582) Signed Attestations, MWF Brimstone Forest Company, LLC, March 19, 2014

Signed_Attestations_CAR582.pdf

Project Documents following the Reserve Review

1c MWF Brimstone IFM Project I (CAR582) Reserve Comments Response Document, Finite Carbon, May 20, 2014

ReserveRequests_CAR582_05202014.docx

2c MWF Brimstone IFM Project I (CAR582) Final Project Design Document, Finite Carbon, May 20, 2014

PDD_CAR582_Brimstone_20140516.pdf

3c MWF Brimstone IFM Project I (CAR582) Final Appendix A, Finite Carbon, May 16, 2014

Appendix A. CAR582_Map_TownsRoads20140516.pdf

4c MWF Brimstone IFM Project I (CAR582) Final Appendix B, Finite Carbon, May 16, 2014

Appendix B. CAR582_Map_Watercourses20140516.pdf

5c MWF Brimstone IFM Project I (CAR582) Final Appendix C, Finite Carbon, May 16, 2014

Appendix C. CAR582_Map_Topography20140516.pdf

6c MWF Brimstone IFM Project I (CAR582) Final Appendix D, Finite Carbon, May 16, 2014

Appendix D. CAR582_Map_CountyCities20140516.pdf

7c MWF Brimstone IFM Project I (CAR582) Final Appendix E, Finite Carbon, May 16, 2014

Appendix E. CAR582_AssessmentAreas20140516.pdf

8c MWF Brimstone IFM Project I (CAR582) Final Appendix F, Finite Carbon, May 16, 2014

Appendix F. CAR582 Data Management and Modeling Systems20131121 Proprietary.pdf

9c MWF Brimstone IFM Project I (CAR582) Final Appendix G, Finite Carbon, May 16, 2014

Appendix G. CAR582 Baseline Harvest Volumes20131007.pdf

10c MWF Brimstone IFM Project I (CAR582) Final Appendix H, Finite Carbon, May 16, 2014

Appendix H. CAR582 Project Inventory Specifications20131007 Proprietary.pdf

11c MWF Brimstone IFM Project I (CAR582) Final Appendix I, Finite Carbon, May 16, 2014

Appendix I CAR582_Geodatabase.gdb.zip

12c MWF Brimstone IFM Project I (CAR582) Final Appendix J, Finite Carbon, May 16, 2014

Appendix J. CAR582 Full Monitoring Plan20131119 Proprietary.pdf

13c MWF Brimstone IFM Project I (CAR582) Final Appendix K, Finite Carbon, May 16, 2014

Appendix K. CAR582 Harvested Wood Products Worksheet20140516.pdf

14c MWF Brimstone IFM Project I (CAR582) Final Appendix L, Finite Carbon, May 16, 2014

Appendix L. CAR582 Harvested Wood Products Worksheet20140516.xlsx

15c MWF Brimstone IFM Project I (CAR582) Final Appendix M, Finite Carbon, May 16, 2014

Appendix M. CAR582 Sampling Error Calculation20131007 Proprietary.pdf

Project Documents for the PIA Review

1d MWF Brimstone IFM Project I (CAR582) Easement Agreement, Climate Action Reserve, November 10, 2014

Easement Agreement.pdf


2d MWF Brimstone IFM Project I (CAR582) Recorded Project Implementation Agreement, Climate Action Reserve, November 10, 2014

Restrictive Covenant and Project Implementation Agreement.pdf

2.4 Interviews

The following is a list of the people interviewed as part of the audit. The interviewees included those people directly, and in some cases indirectly, involved and/or affected by the project activities.

Audit Date Name Title

May 17, 2013 August 23, 2013 October 11, 2013

Tim McAbee Finite Carbon - Director, Project Management

May 17, 21-13, 2013 August 23, 2013 October 11, 2013

Eric Downing Finite Carbon - Associate Director, Project Management

May 17, 2013 August 23, 27-28, 2013 October 11, 2013

Matt Smith Finite Carbon - VP, Forest Operations

May 21 – 23, 2013

Keith Williams Molpus Timberlands – Managing Director – North Region

May 21, 2013

Mark James Molpus Timberlands - Property Manager

May 21, 2013

Wes Selecman Molpus Timberlands

May 28, 2013

Reserve Staff N/A

October 16 - 18

Stakeholder name to remain confidential Scott and Morgan County Staff

May 20, 2014

Stakeholder name to remain confidential Tennessee Wildlife Resource Agency Staff


3 Verification Opinion

During the verification process, the Rainforest Alliance audit team has gathered evidence to evaluate the project design, the project implementation, and assess the accuracy of the GHG assertion associated with the reporting period. Prior to the issuance of a positive verification opinion, any identified material errors, omissions or misstatements are required to be corrected by the Project Proponent. Following the assessment of the project documents and supporting materials, the Rainforest Alliance audit team has gathered sufficient evidence to determine with a reasonable level of assurance that:

The project is in conformance with the requirements of the Climate Action Reserve Forest Project Protocol and supporting documents.

The project is not in conformance with the requirements of the Climate Action Reserve Forest Project Protocol and supporting documents.

The Rainforest Alliance has verified the Project Proponent GHG assertion of:

252,512 tCO2e for the Reporting Period of October 9, 2007 - August 30, 2013.

The GHG assertion is divided into the following vintages:

Vintage Year

Total CRTs (tCO2e)

Total CRTs to Buffer Pool

(tCO2e)

Total CRTs issued (tCO2e)

Conformance with Reserve Software

Conformance with Reserve Program

Documents

2007 50,224 9,643 40,581 Yes No Yes No

2008 150,746 28,944 121,802 Yes No Yes No

2009 11,049 2,122 8,927 Yes No Yes No

2010 11,049 2,122 8,927 Yes No Yes No

2011 11,038 2,120 8,918 Yes No Yes No

2012 11,060 2,124 8,936 Yes No Yes No

2013 7,346 1,411 5,935 Yes No Yes No


APPENDIX A: Field Audit Findings for Improved Forest Management Projects

Note: Findings presented in this section are specific to the findings resulting from the field audit as presented in the Draft Audit Report. Any nonconformances or observations identified during the field audit are noted in this section, and specific NCR and OBS tables are included in the “List of Findings”, Annex B of this report for each identified nonconformance and observations. All findings related to audit team review of additional evidence submitted by the Project Proponent following the issuance of the Draft Audit Report by Rainforest Alliance, are included within the “List of Findings”.

1 Initial Verification Requirements (required for initial verification only) 1.1 FPP Section 2.1.2 Project definition

a. Evidence provided indicating the canopy cover exceeds 10%. b. No evidence exists for use of broadcast fertilization.

Findings from Review on May 17, 2013 – April 8, 2014

The Brimstone Project is identified as an Improved Forest Management Project with the primary goal of generating carbon offset credits by maintaining and increasing additional carbon stocks in a manner consistent with the objectives of the forest owner. The auditors confirmed conformance with eligibility items 1-4 under section 2.1.2 of the Forest Project Protocol (FPP) V3.2 as follows:

1) The project area has greater than 10 percent tree canopy cover, and the PDD, section 2.1, indicates that in 2013 the project was estimated to have 76% tree canopy cover. On-site observations and review of aerial imagery of the project area by the auditors confirmed that the project takes place on land that has greater than 10 percent tree canopy cover.

2) Section 3.10 of the PDD describes how the project fulfils the sustainable harvesting practices and natural forest management practices requirements of the FPPV3.2. Details on how the project is in conformance with these requirements are provided in sections 2.4 & 2.7 of this report below.

3) A declaration that the project does not employ broadcast fertilization is provided in section 2.1 of the PDD. This was also confirmed through auditor interviews with the landowner.

4) Section 2.1 of the PDD indicates that the project area has never been part of a previously registered forest carbon project. Auditor checks to the CAR website, as well as to the websites of the other major carbon programs/standards (VCS, CFS, CCB, ACR, PV) confirmed the project is not a previously registered forest carbon project with any carbon program/standard.

Due to the restrictions imposed on the property by the “sustainable forestry conservation easement” on the property, the 4,861 acre project area is identified as a forest management exclusion area where no management activities will take place. As such the project represents an eligible management activity for an IFM Project. The PD, section 2.1 states that the project takes place on privately owned land. Ownership documentation (doc #30-33) was provided to the auditors which confirmed private ownership of the Brimstone property by MWF Brimstone Company, LLC.

Conformance Yes No N/A

NCR/OBS None

1.2 FPP Section 3.1.1.1: Legal requirement test

Proof that a signed Regulatory Attestation form is on file with the Reserve. In addition to reviewing this form, the VB must conduct a cursory review of site documentation, permits, and any regulatory inspection notifications (violations, notices, etc.) to guarantee that all non-compliance events were immaterial and that the project meets all relevant eligibility criteria.


As stated in section 3.1.1 of the PDD, the Project only asserts claims on GHG emission reductions and removals that are above and beyond all laws, and the auditors confirmed that the emission reductions and removals exceeded the identified baseline scenario as well. Table 1 in section 3.1.1 of the PDD identifies the applicable laws and regulations on the project area and describes how they impact forest management on the project area. The applicable federal regulations identified include the Endangered Species Act, the Clean Water Act & the National Wild & Scenic Rivers Act. State regulations identified include the Tennessee Department of Agriculture, Division of Forestry’s Best Management Practices (BMPs), and the Tennessee Department of Environmental and Conservation, Division of Water Resources and the Division of Natural Area’s Scenic Rivers Program. The PDD indicates that there are no local ordinances or regulations in the local towns or in Scott County that affect timber harvesting.


The “sustainable forestry conservation easement” is also identified as an applicable regulation subject to the project area, which covers the entirety of the 23,216 acre Brimstone forest. In accordance with Reserve guidelines, since the conservation easement represents the project start date, it is not required to be modelled in the baseline. The restrictions of the easement will however be adhered to during implementation of the project.

As described in the PDD, there are 2 primary legal requirements that the project must adhere to in order to yield voluntary emission reductions. These include the Endangered Species Act & the Clean Water Act. BMPs in the state of Tennessee are not regulated, and it is up to forest landowners to adopt and implement BMPs for the protection of water quality. BMPs are however assumed to be adhered to in both the baseline and project scenario. Figure 2 of the PDD provides an image of the legal constraints relative to the project area and shows the locations of stream side management zones (SMZs) established in accordance with Tennessee BMPs. Auditor review of the Tennessee “Guide to Forestry Best Management Practices in Tennessee” confirmed that the state BMPs are non-regulatory guidelines to minimize the environmental impact of forest management activities. The auditors also contacted officials with Scott County and Morgan County and confirmed there are no local ordinances with respect to timber harvesting on privately owned lands. Based on interviews, and on-site observations, no evidence of any violation of any applicable law or regulation was observed or brought to the attention of the auditors during the verification process.

The PDD also indicates that the forest owner meets the legal requirement test by signing the Attestation of Voluntary Implementation – indicating the project is in compliance with all laws and regulations and that the project was voluntarily implemented. Signed copies of these attestations were provided to the auditors and confirmed to be posted on the project’s account on the Reserve software. In accordance with Reserve guidance in FPPV3.2, since the project is an improved forest management project, the performance test is automatically satisfied.


NCR/OBS None

1.3 FPP Section 3.2: Project start date Identification of a discrete, verifiable action that delineates a change in practice relative to the project’s baseline.


Section 3.2 of the PDD identifies the Project Start Date as October 9, 2007. This represents the effective date of the sustainable forestry conservation easement on the property, and represents an action that initiates forest management activities that increase sequestration and/or decrease emissions relative to the baseline. Placement of the conservation easement on the project area reflects the landowner’s commitment to employ practices and technologies with will maintain or increase net carbon stocks for the duration of the crediting period. Recordation of a conservation easement on a project area is an acceptable action for the establishment of the project’s start date in accordance with the FPP V3.2. A copy of the conservation easement was provided for auditor review, and was confirmed to have been recorded on October 9, 2007 (doc #30). The PDD indicates that the project is a pre-existing project submitted to CAR for listing by the April 30, 2010 deadline. The auditors note that the project was originally listed with CAR under the previous landowner (Lyme Timber Company) by the April 30, 2010 deadline, but it was then removed, and relisted with CAR in May 2013. The Project Proponent indicates that this was discussed with the Reserve and that although the project was removed and relisted with CAR after the April 30, 2010 deadline, since it was originally listed before this deadline the project start date rules are being met and that the October 9, 2007 start date is an eligible project start date. This was confirmed through auditor interviews with Reserve staff.


NCR/OBS None

1.4 FPP Section 3.5: Project implementation agreement Proof that a Project Implementation Agreement (PIA) between the forest owner and the Reserve has been signed and recorded in the county of interest.


The auditors were not provided with a signed copy of the Reserve’s Project Implementation Agreement (PIA) at the initiation of verification activities. It is the auditors understanding that signing of the PIA is to take place once the Project is verified and directly before the Project is registered with the Reserve. Follow-up conversations with the landowner however did reveal that they are committed to signing the PIA, and indicated that the PIA will be signed and recorded directly before project registration.


Rainforest Alliance received clear guidance from the Reserve that the PIA is not required until project registration, and as such the lack of evidence of a signed PIA at this time did not warrant an NCR based on the understanding that the Reserve will verify PIA Registration prior to project registration as will Rainforest Alliance. The auditors were provided with a copy of the executed and recorded PIA on December 18, 2014, accompanied by an Easement Agreement. Auditor review confirmed that CAR and the Project Proponent entered into the PIA on November 10, 2014, and that the PIA was recorded in Scott County, Tennessee on November 20, 2014.


NCR/OBS None

1.5 FPP Section 3.8: Project location a. The project is in the United States of America. b. Project is on private land, or c. If non-federal public lands, provide documentation showing approval by the government agency or agencies responsible, or d. If Tribal land, provide documentation that demonstrates that the land within the Project Area is owned by a tribe or private entities.


Section 3.8 of the PDD details the location of the project area. The project area is located in Scott County, Tennessee USA which is in the northern, east/central portion of the state. Latitude and longitudinal coordinates of the approximate geographic center of the project area is provided and is identified as latitude 36°, 16’, 20” North, and longitude 84°, 27’, 17” West. The PDD clearly states that the project is located on privately owned lands, and not on public or tribal-owned lands. The landowner is identified as the MWF Brimstone Forest Company, LLC. Ownership documentation was provided to the auditors which confirmed private ownership of the Brimstone property by MWF Brimstone Forest Company, LLC. Numerous maps provided within, or in accompaniment to the PDD show the location of the project area (figure 1, Appendix A – D).


NCR/OBS None

1.6 FPP Section 4 Appendix A: Project area

Proof that a description and maps of the geographic boundaries defining the project area are on file at the Reserve.


Numerous maps provided within, or in accompaniment to the PDD show the location of the project area (figure 1, Appendix A – D). As required by the FPPV3.2, the maps provided to define the project area display public and private roads (Appendix A), major watercourses – 4th order or greater (Appendix B), Topography (Appendix C), towns/cities (Appendix A & D), Public land survey townships (Appendix D), and latitude/longitude (Appendix D). The project area is comprised of two separate parcels of land which are described as two separate “zones” within the larger forest management exclusion area, which encompasses the project area and is identified in the conservation easement and forest management plan as approximately 5,000 acres. These 2 “zones” or separate parcels are referred to as Indian Creek Brimstone (approximately 1,128 acres) and Bull Creek Brimstone (approximately 3,880 acres).

Section 4 of the PDD details the methodology used to determine the project area boundaries and area. There are 101.43 acres of non-forested land identified as ineligible and therefore not included in the project area. These ineligible non-forested areas are colored in orange in Figure 4 of the PDD. These non-forested areas consist of roads and a utility line easement.

Data checks confirm the listed project acres are consistent with the GIS data provided. Field observations confirmed the location of the project boundaries are consistent with physical features (roads, ridges, streams).


NCR/OBS None

2 Site visit requirements


2.1 FPP Section 3.4: Minimum time commitment Forest Owners must monitor and verify a Forest Project for a period of 100 years following the issuance of any CRT for GHG reductions or removals achieved by the project.


The PDD, section 3.4 clearly states that the project will monitor and verify forest carbon stocks for a period of 100 years following the last year of the issuance of any Climate Action Reserve Tonne of greenhouse gas (GHG) reductions or removals achieved by the project. The forest landowner’s commitment to the minimum time requirements was also confirmed through auditor interviews. Further, commitment to the minimum time requirements of the FPPV3.2 is also demonstrated by the forest landowner’s signing of the PIA. See associated findings in section 1.4 of this report.


NCR/OBS None

2.2 FPP Section 3.7: Attestation of title

Proof that a signed standard Attestation of Title is on file at the Reserve. In addition to reviewing this form, the VB must conduct a review to confirm ownership and the claim to reductions/removals that occur.


With regards to ownership of the Project Area, Section 1.2 of the PDD indicates that on February 8, 2012, The Lyme Brimstone Forest Company was purchased by Molpus Woodlands Fund III, L.P. and renamed to the MWF Brimstone Forest Company, LLC. Molpus Woodlands Group, LLC, is the managing agent on behalf of MWF Brimstone Forest Company, LLC and manages the forest according to the conservation easement. The auditors confirmed the ownership change from the Lyme Brimstone Forest Company to MWF Brimstone Forest Company, LLC as well as the relationship between the MWF Brimstone Forest Company, LLC and Molpus Woodlands Group, LLC through interviews with project management staff. As described in section 3.7 of the PDD, the forest owner has indicated they have an exclusive ownership claim to the GHG reductions and removals achieved by this project as demonstrated through signing the Reserve’s Attestation of Title form. This form is to be signed after the conclusion of each reporting period. The auditors were provided with a signed copy of the Attestation of Title form, and confirmed that this form is posted on the Project’s account in the Reserve’s online software. Further, the auditors were provided with ownership documentation by the Project Proponent (documents # 30-33) which confirmed their ownership of the Project Area and ownership claim of the GHG reductions to be achieved by the Project. Interviews with the landowner also supported their ownership of the Property and associated GHG reduction claims.


NCR/OBS None

2.3 FPP Section 3.9: Regulatory compliance Proof that a signed Attestation of Regulatory Compliance form is on file with the Reserve for the reporting period. In addition to reviewing this form, the verification body must perform a risk-based assessment to confirm the statements made by the Forest Owner in the Attestation of Regulatory Compliance form.


As described in section 3.9 of the PDD, the forest owner attests that the project is in material compliance with all applicable laws relevant to the project activity. Based on interviews, and on-site observations, no evidence of any violation of any applicable law or regulation was observed or brought to the attention of the auditors during the verification process. The auditors were provided with a signed copy of the Attestation of Regulatory Compliance form, confirmed that this form has been uploaded to the Project’s account in the Reserve Online software.


NCR/OBS None

2.4 FPP Section 3.10.1: Sustainable harvesting practices

a. Commercial harvesting is neither planned nor ongoing within the Project Area, or b. At the time commercial harvesting is either planned or initiated within the Project Area, the Forest Owner meets sustainable harvest

practices on all of its landholdings, as described in section 3.10.1.


As indicated in the PDD, and confirmed through a review of the property’s conservation easement, commercial timber harvesting was discontinued at the project start date (the effective date of the conservation easement). The project area is


defined as a forest management exclusion area where no management activities, particularly no timber harvesting will occur. Further, The larger Brimstone Forest containing the project area, consisting of 23,216 acres is certified by the Forest Stewardship Council (FSC), and is covered by an FSC Forest Management and Chain of Custody (FM/CoC) Certificate (RA-FM/CoC-005397). MWF Brimstone Forest Company, LLC is a group member of this FSC FM/COC Certificate which is held by the Alabama Treasure Forest Association (ATFA). ATFA has been FSC certified since March 2011, and the Brimstone property entered ATFA’s FSC FM/CoC Certificate in June 2012. Confirmation of the project area being covered by the ATFA FSC Certificate was made on the FSC-info website (http://info.fsc.org/), and through Rainforest Alliance staff managing ATFA’s certification.


NCR/OBS None

2.5 FPP 3.10.1: Change in Forest Owner Landholdings

If the Forest Owner has acquired additional forest lands outside of the Project Area, the Forest Owner must incorporate the newly acquired land in their demonstration of sustainable long-term harvesting practices within 5 years of the acquisition.


As described in the second to last paragraph in section 1.2 of the PDD, MWF Brimstone Forest Company, LLC purchased the Brimstone property from the Lyme Brimstone Forest Company, LLC on February 8, 2012 which continues to manage the property in accordance with the conservation easement and the current FSC Forest Management Standards. Auditor interviews with the Tennessee Wildlife Resources Agency (TWRA) which handles the conservation easement on the Brimstone property confirmed the validity of the easement, and that the easement “runs with the land” including through the sale of the property from the Lyme Brimstone Forest Company to the current owner, the project proponent, MWF Brimstone Forest Company, LLC. As defined in section 2.2 of the PDD, the forest landowner is MWF Brimstone Forest Company, LLC who is the sole fee owner of the Project Area and larger Brimstone property. No other entity besides MWF Brimstone Forest Company, LLC has control over the forest or management aside from the conservation easement held by the State of Tennessee. Interviews with the landowner confirmed that MWF Brimstone Forest Company, LLC does not own any other forestlands beyond the “Little” Brimstone project area, and the larger working “Big” Brimstone forest.


NCR/OBS None

2.6 FPP 3.10.3: Maintenance of standing live carbon pool

No decrease has occurred in the Project Area’s standing live carbon stocks over any ten-year consecutive period not accounted for by allowable exceptions.


This verification represents the initial verification of the MWF Brimstone Project (CAR582), and its initial reporting period (October 9, 2007 – December 31, 2012). Section 3.10.3 of the PDD states that since the project’s start date, the project’s monitoring reports do not indicate a decrease in the standing live carbon stocks on the project area over any 10 year consecutive period. On-site observations by the auditors did not reveal any evidence of decreases or removals of carbon stocks across the project area. Further, the project area has been established as a forest management exclusion zone, where forest management activities are prohibited, and it is therefore not expected there will be any reductions in carbon stocks due to timber harvesting. In addition, by signing the PIA, the forest landowner has demonstrated their commitment to maintaining carbon stocks on the project area.


NCR/OBS None

2.7 FPP Table 10.4: Natural forest management

a. Native Species: Completed inventory demonstrates that project consists of at least 95% native species. Must demonstrate continuous progress toward goal and criterion must be met within 50 years.

b. Composition of Native Species: a. Reforestation Projects: Documentation on planted mixture of species meets composition of native species goals. Project

must show continuous progress and criteria must be met within 50 years. c. Sustainability of timber resource:

http://info.fsc.org/


a. Documentation showing that the forest, including entity lands outside project area, is currently under one of the following: Third party certification under the Forest Stewardship Council or Sustainable Forestry Initiative/Tree Farm System,

or A renewable long-term management plan sanctioned and monitored by a state or federal agency, or Uneven-aged silvicultural practices (if harvesting occurs) and canopy retention averaging at least 40 percent across the entire

forestland owned by the Forest Owner in the same Assessment Areas covered by the Project Area, as measured on any 20 acres within the Forest Owner’s landholdings found in any of these Assessment Areas, including land within and outside of the Project Area (areas impacted by Significant Disturbance may be excluded from this test).

b. Completed inventory demonstrates the project maintains, or makes progress toward maintaining, no more than 40% of their forested acres in ages less than 20 years. Project must show continuous progress and this criterion must be met within 25 years.

d. Structural Elements (lying and standing dead wood) Completed inventory work demonstrates that lying and standing dead wood is retained in sufficient quantities and for sufficient duration depending on whether portions of the project area have undergone salvage harvesting.


Native species Conformance with the Natural Forest Management requirements is covered in section 3.10.2 of the PDD, and Table 2 describes how the requirements regarding native species, composition of native species, sustainability of the timber resource, and structural elements are met. With respect to native species, basal area per acre by species (standing live) was calculated for all strata using inventory data and then weighted by area. It is stated that native tree species accounted for 99.72 percent of the tree observations in the forest carbon inventory results. While a small amount of non-native species were tallied in the project’s forest inventory and observed by the auditors during the field verification, no non-native tree species were found to be present in the inventory verification plots measured by the auditors.

Composition of native species As required by the FFPPV3.2, no single species in any Assessment Area exceed the given percentage for “composition of native species as a percent of Basal Area of all live trees in the project Area, and also at the Assessment Area level. Five Assessment Areas were identified in the project area. Each is identified below along with how the project meets the composition of native species requirements for the applicable Assessment Area. The verifier confirmed through independent checks of the inventory data that the assertions made by the Project Proponent with respect to native species composition are correct. Alleghany & North Cumberland Mountains Cove Forests:

Appendix F, the Assessment Area data file available on the Reserve website identifies a “Species Diversity” Index value of 70% meaning that for this assessment area no species, as a percent of Basal Area can exceed 70%. Based on the forest carbon inventory results from 2013, the PDD indicates that yellow poplar was found to have the highest percentage composition of 26.74 percent, while sugar maple has the second highest percent composition of 23.80 percent. This is well below the maximum 70% identified in the Assessment Area Data file. Standing live Basal Area and percentage by species (2012) for the Cove Forests Assessment Area is shown in table 4 of the PDD. Alleghany & Northern Cumberland Mountains Mixed Hardwood:

Appendix F, the Assessment Area data file available on the Reserve website identifies a “Species Diversity” Index value of 70% meaning that for this assessment area no species, as a percent of Basal Area can exceed 70%. Based on the results of the forest carbon inventory results from 2013, the PDD indicates that American beech has the highest percentage composition of 31.50 percent while eastern hemlock has the second highest percent composition at 29.87 percent of basal area. This is well below the maximum 70% identified in the Assessment Area Data file. Standing live Basal Area and percentage by species (2012) for the Mixed-Hardwood Assessment Area is shown in table 5 of the PDD. Alleghany & North Cumberland Mountains Mixed Pine-Hardwood:

Appendix F, the Assessment Area data file available on the Reserve website identifies a “Species Diversity” Index value of 60% meaning that for this assessment area no species, as a percent of Basal Area can exceed 60%. Based on the results of the forest carbon


inventory results from 2013, the PDD indicates that yellow poplar is found to have the highest percentage composition of 22.13 percent while eastern white pine has the second highest percent composition at 18.43. This is well below the maximum 60% identified in the Assessment Area Data file. Standing live Basal Area and percentage by species (2012) for the Mixed Pine-Hardwood Assessment Area is shown in table 6 of the PDD. Alleghany & North Cumberland Mountains Northern Hardwoods:

Appendix F, the Assessment Area data file available on the Reserve website identifies a “Species Diversity” Index value of 70% meaning that for this assessment area no species, as a percent of Basal Area can exceed 70%. Based on the results of the forest carbon inventory results from 2013, the PDD indicates that yellow poplar has the highest percent composition at 48 percent while the next highest percent composition was red maple at 10.51 percent of the basal area. Alleghany & North Cumberland Mountains Oak-Hickory:

Appendix F, the Assessment Area data file available on the Reserve website identifies a “Species Diversity” Index value of 65% meaning that for this assessment area no species, as a percent of Basal Area can exceed 65%. Based on the results of the forest carbon inventory results from 2013, the PDD indicates that chestnut oak has the highest percent composition of 24.65 percent while red maple has the second highest percent composition of 16.36 percent of the basal area. This is well below the maximum 70% identified in the Assessment Area Data file. Standing live Basal Area and percentage by species (2013) for the Oak-Hickory Assessment Area is shown in table 8 of the PDD.

Sustainability of timber resource

As indicated in the PDD, and confirmed through a review of the property’s conservation easement, commercial timber harvesting was discontinued at the project start date (the date the conservation easement was recorded). The project area is defined as a forest management exclusion area where no management activities, particularly no timber harvesting will occur. Further, The larger Brimstone Forest containing the project area, consisting of 23,216 acres is certified by the Forest Stewardship Council (FSC), and is covered by an FSC Forest Management and Chain of Custody (FM/CoC) Certificate (RA-FM/CoC-005397). MWF Brimstone Forest Company, LLC is a group member of this FSC FM/COC Certificate which is held by the Alabama Treasure Forest Association (ATFA). ATFA has been FSC certified since March 2011, and the Brimstone property entered ATFA’s FSC FM/CoC Certificate in June 2012. Confirmation of the project area being covered by the ATFA FSC Certificate was made on the FSC-info website (http://info.fsc.org/), and through Rainforest Alliance staff managing ATFA’s certification. As defined in section 2.2 of the PDD, the forest landowner is MWF Brimstone Forest Company, LLC who is the sole fee owner of the Project Area and larger Brimstone property. No other entity besides MWF Brimstone Forest Company, LLC has control over the forest or management aside from the conservation easement held by the State of Tennessee. Interviews with the landowner confirmed that MWF Brimstone Forest Company, LLC does not own any other forestlands beyond the “Little” Brimstone project area, and the larger working “Big” Brimstone forest. As required by the FPPV3.2, On a watershed scale up to 10,000 acres (or the project area, whichever is smaller), all projects must maintain, or make progress toward maintaining no more than 40 percent of their forested acres in ages less than 20 years. Under the Distribution of Age Classes/Sustainable Management section of table 2 in the PDD, it indicates that from the 4,861 acre project area, about 15% of the forested acres are in ages less than 20 years. These areas are delineated and identified in the map provided as figure 3 in the PDD. Field observations corroborate the mapping as submitted.

http://info.fsc.org/


Structural elements As described in the structural elements section of table 2 in the PDD, the Project Proponent found that as of 2013, the actual on-site carbon for standing dead wood is 0.77 metric tonnes of carbon per acre (equivalent to 1.75% of standing live carbon). In accordance with the FPPV3.2, since there was no evidence uncovered by the auditors that lying dead wood has been actively removed, the forest landowner must maintain (or demonstrate progress toward) an average of at least; 1 metric ton of carbon per acre; or 1% of standing live carbon stocks in standing dead wood, whichever is higher. Currently, the Forest owner is maintaining more than 1% of standing live carbon stocks in standing dead wood. While the current levels of 0.77 metric tons of carbon per acre is currently less than 1 metric ton of carbon per acre, the auditors concur with the Project Proponent in that the exclusion of timber harvesting across the project area will ensure that the project continues to fulfil the minimum threshold for standing dead wood as the forests transitions to late-successional stages.


NCR/OBS None

2.8 FPP Section 6.1.3, 6.2.4, 6.3.3, Appendix A and B: Estimation of actual onsite carbon stocks

a. An inventory of the Project Area’s carbon stocks in required and optional pools has been conducted in accordance with the requirements and guidance of Appendix A and B of the FPP (see section 10.3.5 of the FPP for further verification guidance), or

b. Inventory has been deferred until the second site-visit verification for Reforestation projects.


Section 6.1 of the PDD discusses the Project’s forest inventory & modelling plan. While the original baseline inventory was implemented and completed in two stages during June 2010 and 2011, in order to decrease the project’s confidence deduction a second inventory was completed in August 2013. The new inventory measured the same plots from the original inventory, with an additional 12 plots being added to the Cove hardwood (CH3A) stratum. The carbon cruise design was a stratified random sample, and was pre-stratified based on broad forest type, size class and stand density. The broad forest type classes follow the CAR Assessment Areas in the Assessment Area Data File for the applicable Supersection for the Project. The number of plots was determined based on precision targets (target statistical error was +/- 5% for on-site carbon at the 90% confidence interval), and historical measurement of variance on the property. Non-forested areas (NF00) and five forest strata were identified (CH3A, H1A, MX3A, OH3A, OH3D, RMNE2D), are shown along with the plot locations in figure 5 of the PDD. The original 124 plots were installed on a grid of 17.5 x 20 chains and located using GPS units in 2010. One additional sample was added into the regenerating mine (RMNE2D) and nine additional samples in the hardwood (H1A) strata in 2011. In 2013, an additional 12 plots were added into the CH3A stratum and randomly placed using random plot placement tools. For the new inventory completed in 2013, the PDD indicates that a total of 146 1/10th acre (37.2 foot radius) fixed area plots were used for all trees 6.0 inches DBH and larger were used, while 1/100th acre (11.8 foot radius) fixed area plots were used for all trees 1.0 to 5.9 inches DBH (DBH was recorded to the nearest tenth of an inch). Full details that clearly outline the project’s forest carbon inventory design used for the 2013 measurements are provided in the Inventory Specifications (document #20a). The auditors found the Project’s forest inventory design to follow the guidance of CAR inventory requirements in Appendix A & B of the FPP V3.2. Detailed findings on the project’s forest inventory from 2013 and estimation of on-site carbon stocks are provided in sections 3.2 & 5.8 of this report.


NCR/OBS None

2.9 FPP Section 6.1.4, 6.2.5, 6.3.4, Appendix C: Estimation of actual carbon in HWPs The amount of harvested wood that has been delivered to mills over the reporting period has been determined correctly, and the amount of carbon expected to be transferred to wood products and stored over the long-term (100 years) has been calculated correctly, per the requirements in Section 6 of the FPP, and the requirements and guidance in Appendix C (see Section 10.3.7 of the FPP for further verification guidance.


Since the start date of the project, no harvesting has occurred on the property.



NCR/OBS None

2.10 FPP Section 6: Quantification of Primary Effect

Calculation for the Primary Effect are complete and accurate for both onsite carbon stocks and harvested wood products (HWPs).


Calculations of the primary effect are documented in the PDD sections 6.2.4-6.2.7 and in the Monitoring Calculation worksheet (doc #16a). Subsequent sections of this report describe conformance of the components of the primary effect calculations in detail. The quantification of the primary effect is complete and accurate. In no cases did the verifier’s data checks against the Project’s quantification of the primary effect exceed a 3% threshold of materiality.


NCR/OBS None

2.11 FPP Section 6.1.5, 6.2.6, 6.3.5: Quantification of Secondary Effects

Calculations for quantifying Secondary Effects are complete and accurate.


Based on auditor data checks of the project’s carbon quantifications the quantification of secondary effects (Monitoring Calculation worksheet rows 9-28) were confirmed to be complete and accurate.


NCR/OBS None

2.12 FPP Section 7.3: Reversal Determination

If a reversal has occurred, the type of reversal (avoidable or unavoidable) has been properly identified.


No reversals (avoidable or unavoidable) are identified in the PDD, and no reversals were identified, or brought to the attention of the auditors during the verification process as confirmed through on-site observations and interviews with the landowner. As this is an initial verification, reversals may still occur during future years of the project’s life. To address this, the project has correctly accounted for the buffer pool contribution required by the reserve and identified the total buffer pool contribution for the current reporting period as 19.2 percent (table 23). Potential reversals that could occur from various events (i.e. natural or manmade disturbances) are identified in the monitoring plan for the project, and the on-going monitoring activities by the forest owner (conservation easement, FSC, CAR) will ensure that any unavoidable reversals are identified and reported to CAR. An inventory of affected portions of the forest are to be re-inventoried following the inventory specifications (document #20a) to account for unintentional reversals that require CRT replacement from the Reserve buffer pool.


NCR/OBS None.

3 Inventory methodology verification items 3.1 FPP Table 10.5: Inventory design

a. Plot locations are established is such a way that the verification body can acquire independent data from within the measurement area and compare with Forest Owner inventory reports.

b. Inventory methodology document exists. Document is clear and Forest Owner can demonstrate implementation. c. Forest vegetation is stratified (either before or after sampling) or Forest Owner can demonstrate a methodology that enables the

verification body to compare inventory statistics to defined areas (polygons). d. Updating process clearly defined in inventory methodology document and Forest Owner demonstrates adherence to methodology.

Inventory, through update processes, is current. e. Field observations or aerial photos/other remote sensing comparison to inventory reports demonstrate high correlation.


For Improved Forest Management Projects, actual carbon stocks must be determined by updating the Project Area’s forest carbon inventory. Section 6.1 of the PDD discusses the Project’s forest inventory & modelling plan. The carbon cruise design was a stratified random sample, and was pre-stratified based on broad forest type, size class and stand density. The broad forest type classes follow the CAR Assessment Areas in the Assessment Area Data File for the applicable Supersection for the Project. The


number of plots was determined based on precision targets (target statistical error was +/- 5% for on-site carbon at the 90% confidence interval), and historical measurement of variance on the property. Non-forested areas (NF00) and five forest strata were identified (CH3A, H1A, MX3A, OH3A, OH3D, RMNE2D), which are shown along with the plot locations in figure 5 of the PDD.

The original 124 plots were installed on a grid of 17.5 x 20 chains and located using GPS units in 2010. One additional sample was added into the regenerating mine (RMNE2D) and nine additional samples in the hardwood (H1A) strata in 2011. In 2013, an additional 12 plots were added into the CH3A stratum and randomly placed using random plot placement tools. For the new inventory completed in 2013, the PDD indicates that a total of 146 1/10th acre (37.2 foot radius) fixed area plots were used for all trees 6.0 inches DBH and larger were used, while 1/100th acre (11.8 foot radius) fixed area plots were used for all trees 1.0 to 5.9 inches DBH (DBH was recorded to the nearest tenth of an inch). Full details that clearly outline the project’s forest carbon inventory design used for the 2013 measurements are provided in the Inventory Specifications (document #20a). The auditors found the Project’s forest inventory design to follow the guidance of CAR inventory requirements in Appendix A & B of the FPP V3.2. Plot centers were permanently monumented with steel rebar and paint. Tree data was collected using a nested plot designed as described above. For all standing live or dead trees found to be “in,” data was collected on the; tree species, diameter at breast height (DBH), height of each steam (total height & merchantable height), soundness deduction, and decomposition class. To ensure the quality of the data collected, internal audits were performed of the updated inventory data from 2013, and 7 points (5% of the plots) were internally checked for accuracy. Audit results were recorded and made available to the auditors (document #4a). If a cruiser did not meet the quality standards for allowable error, all points for that cruiser were re-inventories by a new cruiser that met the quality thresholds. Further details on the methods of quality control to be followed with respect to responsible organizations & individuals, document control, and data maintenance/storage are provided in document #20a. Section 7.1 of the PDD acknowledges that the FPPV3.2 requires that forest owners monitor on-site carbon stocks, submit regular monitoring reports, and submit to regular third-party verification of those reports with periodic verification site visits for the duration of the project life. Section 8 of the PDD provides detail on the Project monitoring, and indicates that the primary purpose of the project’s annual monitoring plan is to ensure up-to-date estimates of project carbon stocks and provide assurance that GHG reductions or removals achieved by the project have not been reversed. The major components of the monitoring identified include multiple third party audits (Conservation Easement monitoring by the State of Tennessee, FSC monitoring through annual audits required to maintain certification and forest carbon project verification by an accredited CAR Verification Body). The full monitoring plan was made available to the auditors (document #22a), and found to be of sufficient detail to adequately monitor changes in forest carbon stocks on the project area over time. Details on annual forest inventory and carbon stock updates are also provided indicate that the forest owner will use permanent plots and approved growth and yield modelling to annually update the project’s forest carbon stocks. As necessary, new plots are to be installed in areas affected by unplanned harvests, land sales, natural events, or other similar events. Any such events will require spatial and tabular updates of the carbon data set, and both the PDD & full monitoring report adequately detail what will be done regarding carbon stock updates in the event of a land sale or natural disturbance event.

Calculation of actual on-site carbon reported each year will use plot and tree data grown forward by the growth model (Forest Vegetation Simulator – FVS), to the current reporting year along with incorporation of any recently re-measured plots or new plots installed. The monitoring plan clearly details that the inventory plot data used in the estimate of actual on-site carbon stocks will not be more than 12 years old. The Project’s monitoring plan was found by the auditors to be of sufficient detail to track changes in carbon stocks across the project over time, and will ensure that any unavoidable reversals will be identified and reported to CAR. The auditors were able to navigate to the sampled forest inventory plots using a GPS unit with not much difficulty. Monumented plot centers were intact at all plots visited. The Project’s forest inventory specifications outline a clear methodology for data collection, and could easily be followed by the auditors during the inventory verification measurements taken. On-site observations of the various forest strata visited during the field verification confirmed a correlation between the defined stratum, and the forest inventory data collected by both the project and the verifiers.


NCR/OBS None


3.2 FPP Table 10.9: Inventory considerations a) Other Verified Required and Optional Pools:

a. Sampling methodologies for other reported pools adhere to the minimum required sampling criteria in Table A.2 of Appendix A, acceptable forestry practices, and have been implemented correctly.

b) Inventory Update Processes: a. Forest Owner’s inventory document describes methodology for updating inventory data resulting from growth, harvest, and

disturbances. Methodology adheres to acceptable forestry practices (A forest biometrician employed by the state in which the project is located, or a consulting forest biometrician may be consulted in the event of a dispute between the verification body and Forest Owner. The written opinion of the forest biometrician, submitted to the Reserve as part of the verification report, shall be considered the authoritative word).

b. Harvest/Disturbance updates in inventory management system are implemented per the specified methodology and are representative of the harvest or disturbance.

c. Growth is accounted for using an approved growth model or using a stand table projection, as described in Appendix B. c) Biomass Equations and Calculations:

a. The carbon tonnes per acre for a representative sample plot, computed using the Forest Owner’s calculation tools, replicate output computed by the verification body (The verification body must provide an (idealized) ‘verification plot’ consisting of all tree species in Project Area with varying heights and diameters existing within the project area. The plot need not correspond to an actual plot within the Project Area).

b. All conversions and expansions are accurate.


Other verified required and optional pools

Table 10 in the PDD, adapted from the FPPV3.2, includes the appropriate primary and secondary effect sources, sinks, and reservoirs for IFM projects. All required primary effect carbon pools are included:

Standing live carbon (IFM-1)

Standing dead carbon (IFM-3)

Carbon in in-use forest products (IFM-7)

Forest product carbon in landfills (IFM-8) Since commercial timber harvesting in the project scenario will always be equal or less than the baseline scenario, forest carbon in landfills is included. All required secondary effect carbon pools are included:

Biological emissions from site preparation activities (IFM-9)

Biological emissions/removals from changes in harvesting on forestland outside the project area (IFM-14)

Biological emissions from decomposition of forest products (IFM-17)

The auditors recognize that biological emissions from site preparation activities (IFM-9) is negligible to non-existent, given that no further harvesting or site preparation activities will occur on the property. Leakage (IFM-14) is required when harvesting is reduced in the Project Area and harvesting on other lands may increase to compensate, as is the case with the Brimstone project. Biological emissions from decomposition of forest products (IFM-17) are included, and the Project Proponent includes this source in baseline calculations only, as no harvesting is to occur in the Brimstone Project Area.

Inventory update process Section 7.1 of the PDD acknowledges that the FPPV3.2 requires that forest owners monitor on-site carbon stocks, submit regular monitoring reports, and submit to regular third-party verification of those reports with periodic verification site visits for the duration of the project life. Section 8 of the PDD provides detail on the Project monitoring, and indicates that the primary purpose of the project’s annual monitoring plan is to ensure up-to-date estimates of project carbon stocks and provide assurance that GHG reductions or removals achieved by the project have not been reversed. The major components of the monitoring identified include multiple third party audits (Conservation Easement monitoring by the State of Tennessee, FSC monitoring through annual audits required to maintain certification and forest carbon project verification by an accredited CAR Verification Body). The full monitoring plan was made available to the auditors (document


#22a), and found to be of sufficient detail to adequately monitor changes in forest carbon stocks on the project area over time. Details on annual forest inventory and carbon stock updates are also provided indicate that the forest owner will use permanent plots and approved growth and yield modelling to annually update the project’s forest carbon stocks. As necessary, new plots are to be installed in areas affected by unplanned harvests, land sales, natural events, or other similar events. Any such events will require spatial and tabular updates of the carbon data set, and both the PDD & full monitoring report adequately detail what will be done regarding carbon stock updates in the event of a land sale or natural disturbance event. Calculation of actual on-site carbon reported each year will use plot and tree data grown forward by the growth model (Forest Vegetation Simulator – FVS), to the current reporting year along with incorporation of any recently re-measured plots or new plots installed. The monitoring plan clearly details that the inventory plot data used in the estimate of actual on-site carbon stocks will not be more than 12 years old. The Project’s monitoring plan was found by the auditors to be of sufficient detail to track changes in carbon stocks across the project over time, and will ensure that any unavoidable reversals will be identified and reported to CAR.

Biomass equations and calculations

Biomass, carbon, and CO2e calculations were made on both the verification sample data and the updated inventory data by the verifiers for standing live and standing dead. The auditor calculations validate the calculations by the Project Proponent. All data checks yielded results that were below the 3% threshold of materiality for projects of this size. A number of species were recorded in the inventory that had no referenced volume equations in the CAR set of recommended equations for this supersection. Formal guidance from CAR was requested by the project proponents (document 32a). CAR’s response included references to USFS-FIA publications that supplied the appropriate equations for the missing species. The list of inventory species and the equations used is included in document # 2a. The Verifiers confirmed that the CAR guidance was followed and that the correct species were used. Data checks were made against inventory plot data, modeled data, and the verification plot.


NCR/OBS None

3.3 FPP Section 9.1.1.1: Inventory of onsite carbon stock requirements a. An inventory has been conducted of the project’s carbon pools following the guidance of the FPP. b. Baseline onsite carbon stocks must be portrayed in a graph depicting time in the x-axis and carbon tonnes in the y-axis. The

graph should be supported with written characterizations that explain any annual changes in baseline carbon stocks over time. These characterizations must be consistent with the baseline analysis required in section 6 of the FPP.


Section 6.1 of the PDD discusses the Project’s forest inventory & modelling plan. The carbon cruise design was a stratified random sample, and was pre-stratified based on broad forest type, size class and stand density. The broad forest type classes follow the CAR Assessment Areas in the Assessment Area Data File for the applicable Supersection for the Project. The number of plots was determined based on precision targets (target statistical error was +/- 5% for on-site carbon at the 90% confidence interval), and historical measurement of variance on the property. Non-forested areas (NF00) and five forest strata were identified (CH3A, H1A, MX3A, OH3A, OH3D, RMNE2D), which are shown along with the plot locations in figure 5 of the PDD. The original 125 plots were installed on a grid of 17.5 x 20 chains and located using GPS units in 2010. One additional sample was added into the regenerating mine (RMNE2D) and nine additional samples in the hardwood (H1A) strata in 2011. In 2013, an additional 12 plots were added into the CH3A stratum and randomly placed using random plot placement tools. For the new inventory completed in 2013, the PDD indicates that a total of 146 1/10th acre (37.2 foot radius) fixed area plots were used for all trees 6.0 inches DBH and larger were used, while 1/100th acre (11.8 foot radius) fixed area plots were used for all trees 1.0 to 5.9 inches DBH (DBH was recorded to the nearest tenth of an inch). Full details that clearly outline the project’s forest carbon inventory design used for the 2013 measurements are provided in the Inventory Specifications (document #20a). The auditors found the Project’s forest inventory design to follow the guidance of CAR inventory requirements in Appendix A & B of the FPP


V3.2. Plot centers were permanently monumented with steel rebar and paint. Tree data was collected using a nested plot designed as described above. For all standing live or dead trees found to be “in,” data was collected on the; tree species, diameter at breast height (DBH), height of each steam (total height & merchantable height), soundness deduction, and decomposition class. To ensure the quality of the data collected, internal audits were performed of the updated inventory data from 2013, and 7 points (5% of the plots) were internally checked for accuracy. Audit results were recorded and made available to the auditors (document #4a). If a cruiser did not meet the quality standards for allowable error, all points for that cruiser were re-inventories by a new cruiser that met the quality thresholds. Further details on the methods of quality control to be followed with respect to responsible organizations & individuals, document control, and data maintenance/storage are provided in document #20a. Full details that clearly outline the project’s forest carbon inventory design are provided in the Inventory Specifications (document #22a). The inventory specifications and their implementation were determined to follow the guidance of the FPPV3.2. In accordance with the FPPV3.2, Baseline on-site carbon stocks are portrayed in a graph depicting time in the X-axis, and carbon tonnes in the Y-axis in the PDD; figure 11 (Baseline above-ground standing live carbon stocks; figure 12 (additional baseline carbon pools); and figure 13 (final baseline for all on-site carbon pools). Appendix K of the PDD supports these depictions with a listing of annual carbon stocks, growth and harvest.


NCR/OBS None

3.4 FPP Section 10.3.5: Verification inventory The verification body shall allocate the verification plot sets according to the appropriate distribution corresponding to the Verification Field Intensity, as identified in Table 10.8 of the FPP. Each plot set is installed by the verification body, or a consultant hired by the verification body, for an identified area and compared to the Forest Owner’s reported inventory for the same area. The comparison is analyzed using a paired T-test at the 80 percent confidence interval to determine if the inventory is within the same population as the inventory submitted by the Forest Owner. A plot set will either support or raise concerns about the accuracy of the Forest Owner’s inventory. A Forest Owner receiving an 80 percent score or better has demonstrated that their inventory is sound. Forest Owners that do not meet this standard may choose to have additional plot sets analyzed and added to all previous plot sets, or determine that their inventory requires additional effort prior to pursuing further verification activities, with the understanding that the Forest Owner will bear the expense of additional effort. The verification body can also apply their discretion to add more plots in the event the Forest Owner does not meet the score.


For the second site visit (see also the description of the audit process in section 2.2 of this report), the auditors used the T-test method for verification of the Project’s updated forest inventory measurements. Following the guidance in the FPPV3.2, a minimum of 8 plots were required to be measured, and according to the plot allocation rules all plots were allocated to the stratum with the highest stocking levels (OH3A). The determination of the minimum of 8 plots was based on the auditor’s professional judgement of the Project against the Verification/Evaluation Items in Table 10.5 of the protocol, the appropriate Verification Intensity Multiplier for the Project from Table 10.6, and the resulting Verification Field Intensity found using Table 10.7 in the Protocol. Using the Project’s GIS plot shape file attribute table as a source of the plots for this stratum, the auditors generated random numbers between 1 and 68 for each of the 68 plots in the OH3A stratum. The list was then sorted by random number and the first 12 were selected for re-measurement (4 extra in case additional measurement beyond the minimum 8 was necessary).

The selected plots were brought onto a map of the project area and logistical considerations were discussed with the project proponent during a call prior to the second site visit and again at the onset of the second site visit on August 27th. Over the course of two field days during the second site visit, the minimum sampling intensity in accordance with CAR guidelines and as outlined in the audit/sample plan was met (8 plots). With the minimum 8 plots the T-test did not pass the two paired t-test with a score of 80% or higher, but was close. An additional plot was measured and the two paired T-test was re-calculated in the field. The T-test using 9 plots passed with a score higher than 80% allowing the auditors to make a determination that the Project’s inventory was sound.



NCR/OBS None

4 GHG Assessment Boundary – Calculating Baseline 4.1 FPP Sections 5.1, 5.2, and 5.3: The appropriateness of the source, sink and reservoir

Project type specific tables are included within Sections 5.1, 5.2, and 5.3 of the FPP, listing all required and optional SSRs.


Table 10 in the PDD, adapted from the FPPV3.2, includes the appropriate primary and secondary effect sources, sinks, and reservoirs for IFM projects. All required primary effect carbon pools are included:

Standing live carbon (IFM-1)

Standing dead carbon (IFM-3)

Carbon in in-use forest products (IFM-7)

Forest product carbon in landfills (IFM-8) Since commercial timber harvesting in the project scenario will always be equal or less than the baseline scenario, forest carbon in landfills is included. All required secondary effect carbon pools are included:

Biological emissions from site preparation activities (IFM-9)

Biological emissions/removals from changes in harvesting on forestland outside the project area (IFM-14)

Biological emissions from decomposition of forest products (IFM-17)

The auditors recognize that biological emissions from site preparation activities (IFM-9) is negligible to non-existent, given that no further harvesting or site preparation activities will occur on the property. Leakage (IFM-14) is required when harvesting is reduced in the Project Area and harvesting on other lands may increase to compensate, as is the case with the Brimstone project. Biological emissions from decomposition of forest products (IFM-17) are included, and the Project Proponent includes this source in baseline calculations only, as no harvesting is to occur in the Brimstone Project Area.


NCR/OBS None

4.2 FPP Appendix A.4: Uncertainty and confidence deduction

A summary of inventory confidence statistics. Appropriate confidence reduction applied to GHG assertion based on calculated sampling error following the guidance outlined in Appendix A.4 of the FPP.


Confidence statistics are summarized in the PDD section 6.1.3 and details are provided in Appendix M. The verifiers have checked these calculations using the 2013 inventory and found them to be performed correctly following the FPP guidance. The total percent error is 5.68% for the project, resulting in a confidence adjustment to carbon stocks of 0.68%. This value is used in the estimates of total net GHG reductions and removals contained in the Monitoring Calculation worksheet.


NCR/OBS None

4.3 FPP Section 6.2.2: Special considerations for IFM projects on public lands

a. A projection of future changes to project area forest carbon stocks by extrapolating from historical trends; and anticipating how current and future public policy will affect onsite carbon stocks per the requirements of Section 6.2.2 of the CAR Forest Project Protocol.

b. b. An explanation of how current and future public policy will affect onsite carbon stocks and how, the baseline modeling incorporates constraints imposed by all applicable statutes, regulations, policies, plans and Activity-Based Funding.


As described in the PDD, section 2.2, the project area is privately owned by the MWF Brimstone Forest Company, LLC. Ownership documentation was provided to the auditors confirming that the project area, and the larger Brimstone forest is privately owned by MWF Brimstone Forest Company, LLC. The FPPV3.2 special considerations for IFM projects on public lands are therefore non-applicable. The PDD also clearly states that the project is not located on public or tribal-owned lands.



NCR/OBS None

5 Modeling Baseline 5.1 FPP Section 9: Model document

A model document exists that contains all the verification items in this section.


The PDD sections 6.1.4 and Appendix F pertain specifically to modelling, and can be considered the “modelling plan” required by FPP Appendix section B3. Together, these sections present the 4 required components of a modelling plan. These components are more fully described in the report sections below.


NCR/OBS None

5.2 FPP Appendix B.1: Model choice and calibration a. The model used is an approved model. b. The forest owner has provided a description of the rationale for any model calibrations or an explanation of why calibrations were not

incorporated. c. The forest owner has provided a description of the site indexes used for each species and explanation of the source of the site index

values used.


The project developers use Forest Vegetation Simulator (FVS) as the growth and yield model. The correct variant (southern or SN) is used along with the most recent version of the program (VERSION 4862 -- SOUTHERN U.S. RV:01/17/13). FVS is a CAR-approved model. FVS was used to grow initial inventory under a variety of regimes including growth-only-no harvesting, thinning, and clearcutting. The results of the growth-only run were used to “grow” the inventory backwards to 2007 (year of project start date) and to populate yield tables in subsequent optimization modeling. The annual increment of the grow-only run was expanded by the total amount of time between the start date and the time of the inventory and then discounted by that amount from the inventory at the date of the inventory. Auditor review of the documentation on this process (PDD, section 6.1.4 & Document #28a) as well as discussions with the project management staff confirmed the appropriateness of the process followed and associated results to establish the baseline carbon stocks. Model calibration is discussed in the PDD §6.1.4. The model uses the correct regional location code (80211). Each of the six inventory strata were modeled as groups of plots. The Project Proponent describes using field-collected data for site index and increment cores to modify the default site index settings by stratum. The actual site index values used in the modeling have been provided (doc # 14a). The verifiers reviewed the specifications and output of the model runs and were assured that the model outputs showed agreement between the increment core data and the results of the NRCS soil data analysis (see associated findings in section 5.9 below) . Checks against recent FIA data for the region, technical publications for these forest types, and historical documents for this property confirm that the level of removals and the rate of growth conform to these reference benchmarks.

The performance of the Project’s model is reasonable. Evidence provided to support the site index used in the modelling included a listing of the site index trees (31) and a listing of the calculated site index values. The verifiers checked the calculations and found that they adequately support the site index calibrations used in the FVS model. The evidence submitted to support the appropriateness of the regressions used to estimate merchantable height for FVS total height (predicted) from inventory field data included the source data for the height regressions (1685 hardwood trees, 83 softwood trees) and the summary statistics of the regression results. The verifiers reviewed the form of the regression and the results. The relationship between Total Height and Merchantable Height in the inventory data is strong, with regression R2 exceeding 95%. Nearly one-half of the height data are in trees 52 to 77 feet tall and the data appear to fit the curve most tightly in this range. The evidence suggests the assignment of merchantable heights to trees with total heights using these regressions is sound and reasonable.


NCR/OBS None

5.3 FPP Sections 3.1.1, 6.1.1, 6.2.1.2, and 6.3.1: Legal constraints

A list of legal constraints is provided that includes a description of the type and effect of the constraint on the ability to harvest trees and the area constrained for each constraint.



Table 1 in section 3.1.1 of the PDD identifies the applicable laws and regulations on the project area and describes how they impact forest management on the project area. The applicable federal regulations identified include the Endangered Species Act, the Clean Water Act & the National Wild & Scenic Rivers Act. State regulations identified include the Tennessee Department of Agriculture, Division of Forestry’s Best Management Practices (BMPs), and the Tennessee Department of Environmental and Conservation, Division of Water Resources and the Division of Natural Area’s Scenic Rivers Program. The PDD indicates that there are no local ordinances or regulations in the local towns or in Scott County that affect timber harvesting.

As described in the PDD, there are 2 primary legal requirements that the project must adhere to in order to yield voluntary emission reductions. These include the Endangered Species Act & the Clean Water Act. BMPs in the state of Tennessee are not regulated, and it is up to forest landowners to adopt and implement BMPs for the protection of water quality. BMPs are however assumed to be adhered to in both the baseline and project scenario. Figure 2 of the PDD provides an image of the legal constraints relative to the project area and shows the locations of stream side management zones (SMZs) established in accordance with Tennessee BMPs. Auditor review of the Tennessee “Guide to Forestry Best Management Practices in Tennessee” confirmed that the state BMPs are non-regulatory guidelines to minimize the environmental impact of forest management activities. The auditors also contacted officials with Scott County and Morgan County and confirmed there are no local ordinances with respect to timber harvesting on privately owned lands. Legal constraints pertaining to the baseline are briefly summarized on page 35 of the PDD. According to the Project Proponent, no legal constraints that affect forest management exist. The model has been constrained to recognize the area (86 acres) and management (retention of overstory) conforming to the voluntary Tennessee BMP for streamside management zones. Evidence is provided that supports the contention that no additional constraints to apply to harvesting under the baseline scenario. See also associated findings in section 1.2 above.


NCR/OBS None

5.4 FPP Sections 3.1.2, 6.1.1, 6.2.1.3, 6.3.1, Appendix E: Financial constraints

A sufficient qualitative description is provided indicating that the harvesting activity modeled in the baseline is a financially viable activity. For Improved Forest Management projects, Forest Owner has provided either a financial analysis of the anticipated growth and harvesting regime that captures all relevant costs and returns, taking into consideration all legal, physical, and biological constraints; or has provided evidence that activities similar to the proposed baseline growth and harvesting regime have taken place on other properties within the Forest Project’s Assessment Area within the past 15 years.


The Project Proponent submitted evidence supporting harvesting similar to the baseline on a nearby property, occurring in 2011 (document #24 and 25). The evidence supports the comparability of the two sites with respect to site characteristics. The comparable site employed a clearcutting regime on most of the 30 acres harvested, while the project is employing lighter harvests. The ratio of wood products removed on the comparable is roughly 50% sawlogs and 50% pulp; whereas the project property (Appendix L.) suggests a higher proportion of the total volume for the baseline is sawlog, closer to 67%. Clear cuts, removing all material regardless of size or quality, could be reasonably expected to harvest a higher proportion of pulp as compared to the project’s thinning approach. Yields from this comparable are approximately 33 cords/acre, as compared to early period yields from the project at approximately 18 cords/ac under the thinning regime. Overall, the evidence submitted satisfies the financial constraints test. The proposed baseline removals and harvesting activity is considered to be financially feasible.


NCR/OBS None

5.5 FPP Appendix B: Silvicultural guidelines

The silviculture guidelines incorporated in the model demonstrate all legal constraints are applied in the model. The silviculture guidelines must include:

Description of trees retained by species group;


Level of retention;

Harvest frequency; and

Regeneration assumptions


No specific section of the PDD fully describes silvicultural approach employed in the baseline modeling, though the modeling technique is discussed in §6.2.1, Consideration of Legal Constraints. Here, the silviculture is described as: “thinnings that removed 50 percent of the basal area throughout all diameter classes,” and “Regeneration relied on hardwood sprouts and advanced regeneration from established seedlings and saplings.” Harvest area by year is illustrated in the PDD figure 9. A minimum harvest volume constraint (2 MBF/ac) is in place and modeled growth appears consistent with norms for this region and type. As stated in PDD and demonstrated in document 10b, the baseline model resulted in an average return interval of 10 years. While 10 years is the average time for treatments in the baseline, the majority of the property is not treated during the final 20 years of the projected baseline, and this average does not account for the number of years since the last treatment at the start of baseline modelling.


NCR/OBS None

5.6 FPP Sections 6.1, 6.2, and 6.3: Modeling guidelines

Improved Forest Management: Modeling is conducted per Section 6.2.


The modeling used to develop estimates of baseline onsite carbon stocks generally follows the guidance in Section 6.2 and Appendix B of the protocol. Aspects of the baseline modeling are covered in additional detail in other sections of this report.


NCR/OBS None

5.7 FPP Section 9 and Appendix B: Model outputs The forest owner has provided reports that display periodic harvest, inventory, and growth estimates for the entire project area presented as total carbon tonnes and carbon tonnes per acre. Estimates are within the range of expected growth patterns for the project area.


Appendix K in the PDD documents the Baseline inventory, growth, and harvest, both as total and per-acre tonnes of CO2e. This summary, along with the actual model results (documents #29a and 30a) were checked for the accuracy of computations and compared to norms for the region and forest type. Most published growth and yield estimates are reported in cubic feet and not carbon. FIA estimates of growth for the Plateau counties of TN (including Scott county) average 50 cf/ac/yr (2011). Baseline model results range between 45 and 75 cf/ac/yr for the first 40 years of the model, for the major strata. According to research publications for southern hardwoods, medium sites can produce in the range of 65 to 80 cf/ac/yr. Finally, modeling done for this property by a previous owner (document # 35, management plan) supported growth in the range of 58 cf/ac/yr. The FVS model runs for a thinning prescription create yield trajectories that are used in subsequent optimization modeling. The optimization modeling is driven by the objective to harvest in a way that leaves the long-term average stocking close to the level of common practice stocking. The optimization routine evaluates when and how many acres get harvested over time to meet this objective. Harvest volumes are computed as the difference between the pre-harvest volume and the post-harvest volume as defined by the FVS yield trajectory for that stratum. Based on the results provided (PDD figure 9), nearly every project acre is harvested in the early years of the baseline scenario, and major harvests occur over roughly 10-year intervals. This effectively means that harvested acres spend most of their time “growing” on the early years of the yield curve. Typically, the early years of any modeled scenario are more reliable than later years.


NCR/OBS None

5.8 FPP Section 6.2.1 Appendix A: Inventory of Onsite carbon stocks (Private land only)

An inventory of the Project Area’s carbon stocks in required and optional pools has been conducted in accordance with the requirements and guidance in Appendix A of the FPP (see Section 10.3.5 of the FPP for further verification guidance).


Section 3 of this report above, describes the inventory design and execution. Based on the evidence provided (cited above) and the verifiers observations on the project site, the inventory is deemed to be in accordance with CAR guidance.


FPP 10.3.5 requires that reports that reference carbon stocks be submitted under the “oversight of a Professional Forester.” Section 1 of the PDD states “The PDD and all other project documentation and reports that reference carbon stocks has been prepared and submitted by Tim McAbee, SAF Certified Forester (No. 3789).” Since TN does not require state licensing of foresters, this satisfies the oversight test.


NCR/OBS None

5.9 FPP Section 6.2.1 Appendix A and F: Compare initial aboveground standing live carbon stocks with the minimum baseline level (Private land only)

a. The baseline analysis utilizes the correct value for Common Practice and the Minimum Baseline Level (for above-ground standing live carbon stocks) associated with the Assessment Area(s) covered the Project Area.

b. Initial above-ground standing live carbon stocks have been estimated correctly following the requirements and guidance in Appendix A of the FPP.


As displayed in Appendix E (Document #7), the entire Project Area is located within the Allegheny and North Cumberland Mountains CAR Supersection. The auditors confirmed the appropriateness of the five Assessment Areas identified in the Project Area (Cove Forests, Mixed Hardwoods, Mixed Pine-Hardwood, Northern Hardwoods, Oak-Hickory) by reviewing section 6.2.1 of the PDD and the corresponding species composition from the FPP Assessment Area Data File. Further, based on the tree species observed and measured in the field by the auditors as well as the tree species recorded in the Project’s forest inventory (Table 14 of the PDD), the auditors confirmed the appropriateness of the species composition for each assessment area and forest strata that make up the Project Area. The choice of Assessment Area and the values for Common Practice (CP) calculations are provided in the PDD, §6.2.1. In justifying the use of low site class for all four assessment areas, the project proponent cites the Natural Resources Conservation Services (NRCS) Soil Survey Geographic Database (SSURGO) and provides a supplemental document describing the area-weighted, soils-based assessment conducted to support this assignment. Verifiers reviewed the productivity classes for the major soils in Scott County and found evidence to support the project proponent’s analysis. Overall, the productivity of these assessment areas in the low-site class is consistent with FIA and other published productivity for the region. Further auditor review of the model outputs confirmed agreement between the increment core data and the results of the NRCS soil data analysis. According to the FPP V3.2, determining the minimum baseline level (MBL) for an IFM project requires comparison to carbon stocking levels on other lands within the same logical management unit. A LMU is defined as; “all land that the forest owner and its affiliate(s) either own in fee or hold timber rights on, and which it or they manage as an explicitly defined planning subunit. LMUs are generally characterized by having unique biological, geographical, and/or geological attributes, are generally delimited by watershed boundaries and/or elevation zones, and contain unique road networks.” As described in Section 6.2.1 of the PDD (page 39), the Project Area was identified as one LMU and that the Project Area was used for the purposes of calculating WCS (The weighted average of above-ground standing live carbon stocks per acre for all forest owner (and affiliate) landholdings within the same logical management unit as the Project Area). The Project Proponent asserts that the Project Area has unique qualities consistent with the definition of an LMU which are demonstrated in the conservation easement. The Project Area is legally defined by its special status within the larger Brimstone property’s conservation easement as a Forest Management Exclusion Area. The conservation easement provides a detailed description of the forest management exclusion area that is approximately 5,000 acres where no management activities will occur. The exclusion area has been explicitly defined through a map prepared by the State of Tennessee (the Grantee) in which the easement describes “shall be maintained with the baseline documentation.” The auditors acknowledge that the description of the exclusion area in the easement indicates “the location and boundaries of any forest management exclusion area may shift or be adjusted over time with the mutual consent of the parties.” However as documented in the PDD and confirmed through discussions with project management staff, the landowner has no plans to modify the location and boundaries of the forest management exclusion area. Further, CAR prohibits any adjustments to the Project Area in the future. The PDD offers additional justification on the selection of the Project Area as the LMU for determining the MBL based on its other unique attributes. The auditors concur with the defined LMU that has been selected for the project.

Table 13 (PDD) documents the area-weighting of the Common Practice stocking for each stratum, and calculates the weighted Common Practice carbon stock at 87.67 tonnes CO2e (AGSL). These calculations were verified as correct and use the correct Assessment area stocking levels. This section of the PDD goes on to document the calculation of MBL following the steps in the


FPP. FPP equation 6.5 is calculated correctly and reported on page 42 of the PDD. Estimates of initial above-ground standing live stocks involved the following steps:

1. Grow initial inventory ahead 5 years to estimate growth rates for dbh and height. 2. Apply these rates to the initial inventory for 6 years in reverse, essentially estimating the diameter and heights of each

tree as existing at the project start date in 2007. 3. Calculate AGSL stocks for this adjusted tree list, using the CRM method prescribed by the FPP.

Table 15 (p. 34) of the PDD presents the result of these steps, and Appendix F describes the process in more detail. Various documents (#28a, 31a) offer results of tree and plot level calculations. The verifiers have checked the application of periodic growth from the model to the 2013 trees, and have independently confirmed the calculation of both 2013 and 2007 estimates of carbon. All estimates were found to be accurate below the 1% materiality threshold. All calculations reflect the guidance in Appendix A of the FPP.


NCR/OBS None

5.10 FPP Section 6.2.1 (Private land) 6.2.2 (Public land), Appendix B: Baseline carbon stock modeling A 100-year forest management simulation of standing live carbon stocks has been conducted in accordance with the requirements and guidance in Section 6.2.1 or 6.2.2, and Appendix B of the FPP (see Section 10.3.5 or 10.3.6 of the FPP for further verification guidance).


FPP V3.2, section 6.2.1 cites the following 4 required steps:

1. Determine the Common Practice level of above-ground standing live carbon stocks applicable to the Project Area. 2. Determine if the Project Area’s initial above-ground standing live carbon stocks are above or below Common Practice. 3. Estimate baseline above-ground standing live carbon stocks, taking into account financial and legal constraints on harvesting in the Project Area, as well as the minimum baseline level applicable to the Project Area, as defined in the guidance for Step 3. The minimum baseline level will depend on whether initial above-ground standing live carbon stocks are above or below common practice. 4. Determine the baseline carbon stocks over 100 years for all required and optional carbon pools in the Project Area. As cited in this report, §5.9, above. Common Practice stocks for the Project Area were calculated correctly. Initial carbon stocks for the Project (2007) were calculated correctly and PDD pg. 34 compares the CP stock (87.67) against the initial stock (119.44). MBL was calculated and initial stocks were projected in the baseline scenario, under appropriate financial and legal constraints. Above-ground, standing live stocks are averaged over the 100-year baseline and reported in Figure 11 and Appendix K. Figure 12 (Pg. 44) incorporates standing dead stocks. Estimates of harvested wood products are included in Figure 14 and supported by Appendix G. The Verifiers checked the common practice calculations, independently calculated estimates of AGSL and standing dead carbon, reviewed the calculations and estimates of harvested wood products, and verified that correct species equations and calculations were employed. A verification plot, with all species in the inventory represented, was submitted to the project developer for calculation of carbon. The Project Proponent’s results were within 0.15% of the verifier’s results (<0.1 tonnes difference).


NCR/OBS None

5.11 FPP Section 9.1.1: Description of forest project activities A description has been provided of the management activities that will lead to increased carbon stocks in the Project Area compared to the baseline.


Section 3.2 of the PDD identifies the Project Start Date as October 9, 2007. This represents the date in which the sustainable forestry conservation easement was executed. The conservation easement establishes the Project Area as a Forest Management Exclusion Area where no forest management activities will occur. Establishing the Project Area as an exclusion area ensure the management activities will lead to increased carbon stocks on the Project Area relative to the common practice baseline.



NCR/OBS None

5.12 FPP Section 6.2.2 Appendix A: Initial forest carbon stock inventory (Public land only)

An inventory of the Project Area’s carbon stocks in required and optional pools has been conducted in accordance with the requirements and guidance in Appendix A (see Section 10.3.5 for further verification guidance).


As described in the PDD, section 2.2, the project area is privately owned by the MWF Brimstone Forest Company, LLC. Ownership documentation was provided to the auditors confirming that the project area, and the larger Brimstone forest is privately owned by MWF Brimstone Forest Company, LLC. The FPPV3.2 special considerations for IFM projects on public lands are therefore non-applicable. The PDD also clearly states that the project is not located on public or tribal-owned lands.


NCR/OBS None

6 Harvested Wood Products Estimates 6.1 FPP Sections 6.2.1 – 6.2.3, Appendix B and C: Baseline harvest volume

The average volume of harvesting in each year of the baseline over 100 years has been derived from the growth and harvesting regime used to develop the baseline for onsite carbon stocks, following the requirements and guidance in Section 6.2.1 or 6.2.2, Section 6.2.3, Appendix B, and Appendix C of the FPP (see Section 10.3.7 of the FPP for further verification guidance).


The periodic harvest volume for the entire 100-year baseline is reported in Appendix G, as derived from the baseline modeling (presented in cubic foot units). The protocol specifically calls for determining the average harvest volume (FPP § 6.2.3), providing “a uniform estimate of carbon harvested each year of the baseline…” The average harvest volume has been calculated from the baseline modeling and is presented in Figure 14 and in the accompanying text on page 44 of the PDD. The verifiers have checked the calculation of CO2e from cubic foot volume, and have validated that the averages presented are correct. See the discussion in section 5.7 above for more detail on the modeling approach used to determine baseline harvest volumes. The data presented and methods used are consistent with the protocol guidance.


NCR/OBS None

6.2 FPP Section 6.2.3, Appendix C: Long-term storage in wood products

The average amount of carbon expected to be transferred to wood products each year and stored over the long-term (100 years) has been calculated following the requirements and guidance of Section 6.2.3 and Appendix C (see Section 10.3.7 for further verification guidance).


The periodic volume of harvested wood for the entire 100-year baseline is reported in Appendix G (in cubic feet), as derived from the baseline modelling and the average volume (CO2e) in Baseline wood harvested is noted in Figure 14 of the PDD. Auditor data checks confirmed these calculations were correct and performed in accordance with the requirements and guidance of Section 6.2.3 and Appendix C of the FPP V3.2. While the average in CO2e can be verified (approximately) as being derived from the average of cf volume, there is no evidence for this calculation.


NCR/OBS None

6.3 FPP Appendix C.1: Carbon in harvested wood delivered to mills a. Amount of wood harvested that will be delivered to mills has been estimated and reported. b. The appropriate wood density factor has been applied and/or water weight subtracted to result in pounds of biomass with zero

moisture content. c. Total dry weights for all harvested wood have been calculated. d. Total carbon weight has been computed. e. The total has been converted to metric tonnes of carbon.


The total carbon in harvested wood and wood delivered to mills was calculated using the standard CRM equations and tree lists from the baseline scenario. This accounts for wood density and converts cubic foot volume to weight. The PDD states that only merchantable wood is included in the delivered wood estimate (no bark, top, stump or below-ground portions). Verifier checks of


harvested trees confirm the appropriate components were summed.


NCR/OBS None

6.4 FPP Appendix C.2: Account for mill efficiencies The correct mill efficiency factors have been used to calculate total carbon transferred into wood products.


The Project Proponent used the CAR-supplied Harvested wood products worksheets (document #24a). These worksheets require that data be entered for baseline average volumes in CO2e units for harvested wood and delivered wood. The user must also enter the correct region. The verifiers confirmed that the correct region has been entered and that the baseline estimates for harvested wood and delivered wood are consistent across the various references in the PDD and Forest Calc worksheet (document #16a). Mill efficiency factors are automatically provided by the worksheet if the correct region is entered.


NCR/OBS None

6.5 FPP Appendix C.3: Wood product classification The percentages of harvest by wood product class has been determined correctly with verified reports from the mill(s) where the Project Area’s logs are sold; or by looking up default wood product classes for the project’s Assessment Area(s); or if not available from either of these sources, by classifying all wood products as “miscellaneous.”


The PDD states “In HWPCW Table 5, the average baseline carbon in harvested wood delivered to the mill is then distributed among the wood product classes based on the percent product values established by the volume actually harvested in the project for that reporting period.” (pg. 48). The proportions of harvested wood delivered to mills by product class are entered in the wood products worksheet (document 24a). The Project Proponent supports the wood product proportions entered in the harvested wood products worksheet which uses the correct default product proportions for the Project’s supersection. The calculated results that are also presented in the final PDD and monitoring calculation worksheet were reviewed by the Verifiers and found to be correct.


NCR/OBS None

6.6 FPP Appendix C.3 and C.4: Calculation of in-use and landfill carbon storage a. The average amount of carbon stored in in-use wood products over 100 years has been calculated correctly using the worksheets in

Appendix C. b. The average amount of carbon stored in landfilled wood products over 100 years has been calculated correctly using the worksheets

in Appendix C.


CAR Default values for in-use and in landfill are used in the harvested wood products worksheet, based on Table 10 in that worksheet. These are the correct values and the calculations are performed automatically.


NCR/OBS None

6.7 FPP Appendix C.5: Total average carbon storage in wood products over 100 years

Total average carbon storage in wood products over 100 years for a given harvest volume has been calculated and reported.


Document 24a automatically calculates the project and baseline carbon stored in harvested wood products, as long as the correct inputs are provided and the correct region is chosen. These final values are then entered into the Forest Calc worksheet. The values summarized in document #24a have been correctly transferred to the Forest Calc worksheet (document #16a)


NCR/OBS None


7 Monitoring Plan 7.1 FPP Section 8.1: Approval of the monitoring methodology

Prior to a Forest Project’s first verification, the Forest Owner must establish a monitoring plan detailing the specific methods that will be used to update the project’s forest carbon inventory on an annual basis. The inventory methodology detailed in this monitoring plan must adhere to the guidance in Appendix A and B, which establish the equations for computing biomass and limits to which computer models can be used in the inventory update process.


Section 7.1 of the PDD acknowledges that the FPPV3.2 requires that forest owners monitor on-site carbon stocks, submit regular monitoring reports, and submit to regular third-party verification of those reports with periodic verification site visits for the duration of the project life. Section 8 of the PDD provides detail on the Project monitoring, and indicates that the primary purpose of the project’s annual monitoring plan is to ensure up-to-date estimates of project carbon stocks and provide assurance that GHG reductions or removals achieved by the project have not been reversed. The major components of the monitoring identified include multiple third party audits (Conservation Easement monitoring by the State of Tennessee, FSC monitoring through annual audits required to maintain certification and forest carbon project verification by an accredited CAR Verification Body). The full monitoring plan was made available to the auditors (document #22a), and found to be of sufficient detail to adequately monitor changes in forest carbon stocks on the project area over time. Details on annual forest inventory and carbon stock updates are also provided indicate that the forest owner will use permanent plots and approved growth and yield modelling to annually update the project’s forest carbon stocks. As necessary, new plots are to be installed in areas affected by unplanned harvests, land sales, natural events, or other similar events. Any such events will require spatial and tabular updates of the carbon data set, and both the PDD & full monitoring report adequately detail what will be done regarding carbon stock updates in the event of a land sale or natural disturbance event. Calculation of actual on-site carbon reported each year will use plot and tree data grown forward by the growth model (Forest Vegetation Simulator – FVS), to the current reporting year along with incorporation of any recently re-measured plots or new plots installed. The monitoring plan clearly details that the inventory plot data used in the estimate of actual on-site carbon stocks will not be more than 12 years old. The Project’s monitoring plan was found by the auditors to be of sufficient detail to track changes in carbon stocks across the project over time, and will ensure that any unavoidable reversals will be identified and reported to CAR.


NCR/OBS None

7.2 FPP Section 9.1 and 9.4: Whether the monitoring plan provides detailed information related to the

collection and archiving of all relevant data Monitoring plan includes instructions for archiving data as outlined in section 9.1 and 9.4 of the FPP.


Appendix J (document 22a) provides the full monitoring plan for the project. Within this document information describes the monitoring quality control procedures including Organization and Responsible Individuals, Document Control and Central Data Repository procedures. The forest owner (MWF Brimstone Forest Company, LLC) and Finite Carbon are responsible for maintaining critical documents and files that support carbon data collection and processing. The ESRI personal geodatabase will be used to store spatial and tabular project data. It is stated that all monitoring results will be summarized in the Annual Forest Monitoring Report required by the Reserve. Page 5 of the Monitoring Plan (Appendix J) acknowledges the requirement for the forest owner to keep all documents and forms related to the project for a minimum of 100 years after the final issuance of CRTs, and clearly indicates that the quality control procedures will be implemented and maintained during this 100 year period.


NCR/OBS None

8 Reversal Risk Analysis and Buffer Pool Contribution Risk type Application Conformance

Financial Risk FPP Appendix D.1: Financial failure of an organization resulting in bankruptcy can lead to dissolution of

Yes No


agreements and forest management activities to recover losses that result in reversals. Projects that employ a Qualified Conservation Easement or Qualified Deed Restriction, or that occur on public lands, are at a lower risk than projects with a PIA alone.

Findings: As stated in section 3.6 of the PDD, the Project does not employ a qualified conservation easement as defined in the FPP V3.2. This section of the PDD also states that the Project does not employ a Qualified Deed Restriction. Table 23 of the PDD provides the risk rating analysis for the required buffer pool contribution. Regarding financial risk, the project has correctly identified the default risk score of 5% given that there is no qualified conservation easement or deed restriction in place on the property.

Management Risk: Illegal removal of forest biomass

FPP Appendix D.2: Illegal logging occurs when biomass is removed either by trespass or outside of a planned set of management activities that are controlled by regulation. Illegal logging is exacerbated by lack of controls and enforcement activities.

Yes No

Findings: In accordance with the FPPV3.2, table 23 of the PDD identifies the risk rating for illegal removals of forest biomass as 0%. This is the correct default risk rating for the illegal removal of forest biomass to be used for projects located in the United States.

Management Risk: Conversation of project area to alternate land use

FPP Appendix D.2: High values for development of housing and/or agriculture may compete with timber and carbon values and lead to a change in land use that affects carbon stocks. The risk of conversion of any Project Area to other non-forest uses is related to the probability of alternative uses, which are affected by many variables, including population growth, topography, proximity to provisions and metropolitan areas, availability of water and power, and quality of access to the Project

Area.

Yes No

Findings: As stated in section 3.6 of the PDD, the Project does not employ a qualified conservation easement as defined in the FPP. This section of the PDD also states that the Project does not employ a Qualified Deed Restriction. Table 23 of the PDD provides the risk rating analysis for the required buffer pool contribution. Regarding risk of conversion of the project area to alternate land uses, the project has correctly identified the default risk score of 2% given that there is no qualified conservation easement or deed restriction in place on the property.

Management Risk: Over-harvesting FPP Appendix D.2: Favorable timber values, among other reasons, may motivate some project managers to realize timber values at the expense of managing carbon stocks for which CRTs have been credited. Additionally, reversals can occur as the result of harvest associated with fuels treatments.

Yes No

Findings: As stated in section 3.6 of the PDD, the Project does not employ a qualified conservation easement as defined in the FPP. This section of the PDD also states that the Project does not employ a Qualified Deed Restriction. Table 23 of the PDD provides the risk rating analysis for the required buffer pool contribution. Regarding risk of over-harvesting, the project has correctly identified the default risk score of 2% given that there is no qualified conservation easement or deed restriction in place on the property.

Social Risk FPP Appendix D.3: Social risks exist due to changing government policies, regulations, and general economic conditions. The risks of social or political actions leading to reversals are low, but could be significant.

Yes No

Findings: In accordance with the FPPV3.2, the PDD identifies the social risk rating as 2%. This is the correct default social risk rating to be used for projects located in the United States.

Natural disturbance: Wildfire FPP Appendix D.4: A wildfire has the potential to cause significant reversals, especially in certain carbon pools. These risks can be reduced by certain techniques including reducing surface fuel loads, removing ladder

Yes No


fuels, adding fuel breaks, and reducing stand density. However, these techniques cannot reduce emission risk to zero because all landowners will not undertake fuel treatments, nor can they prevent wildfire from occurring.

Findings: Table 23 in the PDD identifies the wildfire risk rating as 4%. Below this table the PDD describes how the wildfire risk was established based on the default risk for the applicable Supersection and Assessment Areas from the most recent Assessment Area Data file as published on the Reserve website. This was confirmed to be accurate based on auditor review of the Assessment Area Data file. Based on on-site observations and interviews with the landowner, there was no evidence of fuel treatments being implemented on the project area, and the default wildfire risk rating was therefore the appropriate selection – rather than reducing the value by the appropriate percentage in accordance with the FPPV3.2.

Natural disturbance: Disease or insect outbreak

FPP Appendix D.4: A disease or insect outbreak has the potential to cause a reversal, especially in certain carbon pools. All projects within the U.S. have the same default natural disturbance of disease or insect outbreak.

Yes No

Findings: In accordance with the FPPV3.2, the PDD identifies the risk rating for disease or insect outbreaks as 3%. This is the correct default risk rating for disease or insect outbreaks to be used for projects located in the United States.

Natural disturbance: Other episodic catastrophic event

FPP Appendix D.4: A major wind-throw event (hurricane, tornado, high wind event) has the potential to cause a reversal, especially in certain carbon pools. All projects within the U.S. have the same default natural disturbance of other episodic catastrophic event risk.

Yes No

Findings: In accordance with the FPPV3.2, the PDD identifies the risk rating for other episodic catastrophic events as 3%. This is the correct default risk rating for other episodic catastrophic events to be used for projects located in the United States.

Cumulative risk FPP Appendix D.5: Reversal risk rating calculate correctly using the formula in Appendix D.5 of the FPP.

Yes No

Findings: Section 7.3 of the PDD identifies the total buffer pool contribution for the current reporting period as 19.2%. This section also outlines the correct formula for determining the overall buffer pool contribution percentage. Table 23 identifies the risk rating determined for each risk item, and correctly shows the calculation of the overall total risk score to be applied to the project. All risk items that can be impacted on whether or not there is a qualified conservation easement or deed restriction in place, accurately reflect the correct higher score since the project does not employ a qualified conservation easement or deed restriction. In accordance with CAR guidance, the total risk score calculated also correctly waives the additional 2.0 % for the PIA Subordination Clause (Type I) on top of the risk rating analysis result because the Landowner will be converting all offset credits to the ARB offset program and compliance offset protocol.

NCR/OBS: None


APPENDIX B: Organization Details Contacts

Primary Contact for Coordination with Rainforest Alliance

Primary Contact, Position: Tim McAbee, CF, Director - Project Development

Address: 435 Devon Park Drive, 700 Building Wayne, PA 19087

Tel/Fax/Email: 484-949-5427/484-586-3081/[email protected]

Billing Contact

Contact, Position: Tim McAbee, CF, Director - Project Development

Address: 435 Devon Park Drive, 700 Building Wayne, PA 19087

Tel/Fax/Email: 484-949-5427/484-586-3081/[email protected]