EXHIBIT 99.1

Press Release                 June 15, 2001               Contact: Mike Sullivan
                                                                  (509) 835-1516


              POTLATCH ANNOUNCES PLANNED DEBT REFINANCING PROGRAM
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SPOKANE, Wash. -- Potlatch Corporation (NYSE:PCH) today announced plans to
proceed with a debt refinancing program that is intended to substantially
increase its financial flexibility.

    The company is pursuing a new $400 million bank credit facility and is
seeking to raise approximately $250 million through an institutional private
placement of senior subordinated notes.  The company expects to complete the new
credit facility and the note offering later this month, subject to market
conditions.  The net proceeds of the note offering and initial borrowings under
the new credit facility would be used to refinance the company's existing bank
loans, meet its debt maturity obligations in 2002 and provide working capital.

    The new credit facility is expected to consist of a $200 million three-year
revolving credit facility and a $200 million four-year term loan.  The company
anticipates that the new credit


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facility will be secured by approximately 130,000 acres of its timberlands, as
well as its accounts receivable and inventory.

    The company expects that the terms of the new credit facility will require
the company to maintain compliance with financial tests, including a funded
indebtedness to capitalization ratio, a minimum consolidated net worth test and
a fixed charge coverage ratio.  The company also expects that the new credit
facility will contain restrictive covenants, including covenants limiting its
ability to incur indebtedness, create liens, merge, dispose of assets, pay
dividends or make certain investments.

    The senior subordinated notes have not been registered under the Securities
Act of 1933, as amended, or any state securities laws, and are being offered
only to qualified institutional buyers in reliance on Rule 144A under the
Securities Act.  Unless so registered, the notes may not be offered or sold in
the United States except pursuant to an exemption from the registration
requirements of the Securities Act and applicable state securities laws.  This
press release shall not constitute an offer to sell or the solicitation of an
offer to buy, nor shall there be any sale of the notes in any state in which
such offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state.


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    Except for the historical information contained herein, the matters set
forth in this press release, including statements concerning the company's plans
for a new credit facility and offering of senior subordinated notes, are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995.  These forward-looking statements are based on
management's best estimates and assumptions regarding future events and are
therefore subject to known and unknown risks and uncertainties that could cause
actual results to differ materially.  These risks and uncertainties include the
company's ability to reach final agreement with the lenders under the proposed
new credit facility, market conditions for the senior subordinated notes, the
company's substantial indebtedness and, as it relates to financial tests and
restrictive covenants in the proposed new credit facility, its ability to reach
its debt reduction targets, cyclical conditions in the forest products industry,
competitive conditions and prices in the company's markets, changes in wood
fiber, energy and other variable operating expenses, changes in environmental
laws and unforeseen environmental liabilities and expenditures, fires and other
natural disasters, labor disruptions and other risks and uncertainties described
from time to time in Potlatch's reports filed with the SEC, including its Annual
Report in Form 10-K for the year ended December 31, 2000 and its Quarterly
Report on Form 10-Q


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for the three months ended March 31, 2001. These forward-looking statements
speak only as of the date hereof. The company disclaims any intent or obligation
to update these forward-looking statements to reflect events or circumstances
occurring after the date hereof.

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