Cuomo hopes to see forest initiative funded
According to a proposal in Gov. Andrew Cuomo’s State of the State, far too few forest owners are taking advantage of tax breaks that can help the economy and environment.
In addition to calling for $300 million in funding for the Environmental Protection Fund, Cuomo also wants to establish the Empire Forests for the Future Initiative, aimed at keeping privately-held forests wild.
More than four decades ago, New York instituted what is known as 480-a Forest Tax Law. The law essentially allowed owners of 50 contiguous acres of forest to get a break on their property taxes in exchange for developing and following a forest management plan. That plan can allow for harvesting of forest products or outdoor recreation, but failure to follow the plan carries penalties.
The State of the State says that only a small percentage of eligible owners are taking advantage of the incentive.
“There is more to be done to better protect and sustain the state’s private forest lands. Private lands account for three-quarters of New York’s 19 million acres of forest,” the forest proposal reads. “The state’s forest management and timber harvesting industries support an estimated 6,000 direct jobs and provide an annual economic contribution of $14 billion, 90 percent of which comes from private forest lands.
“Timber harvesting in New York currently generates an estimated $250 million per year in forest landowner revenue, and the forest product industry remains in the top ten manufacturing sectors statewide.”
However, the proposal also notes that the sell-off or subdivision of forests is a major concern in New York for a number of reasons.
“These practices negatively impact tree species diversity and long-term economic value of the land, and leave genetically inferior trees standing–and are, in large part, caused by the pressure of high property taxes,” the SOTS says. “To address the property tax burden, which is the chief concern of most forest landowners, the State adopted a forest property tax reduction program known as 480-a. “However, after more than 40 years, only seven percent of eligible landowners–covering just 16 percent of eligible private forest lands–participate despite the availability of significant tax benefits.”
The governor’s new initiative would encourage more forest owners to join the 480-a program through a number of measures, including a new law that would be called 480-b.
The new law would simplify the application process and provide landowners who already have certified working forests with an easier approval process. The new law would also reduce the size of contiguous forest from 50 acres to 25 acres for the purposes of getting the tax break. The state considers forests contiguous regardless of county or town boundaries.
480-b would also expand eligible lands from just forests to include open spaces, “better enabling the state to protect important ecosystems and water resources.”
The new law would also have financial implications. One would create “a state procurement preference for New York wood products,” while also establishing two grants for landowners and financial help for local governments that lose out on the tax revenue.
“One [grant] to help landowners implement best forest management practices, and one [grant] to support local governments and non-profits acquiring and managing community forests,” would be included, while also providing “financial relief to local governments that are significantly impacted by the existing 480-a program, in which the tax breaks given to participating forest landowners are shifted to other property taxpayers.”
The initiative would also start out by providing $150,000 “in grants to create hands-on training programs for New York’s loggers, starting in the Southern Tier.”
While the main beneficiaries of these measures are the landowners, the proposal also touts ecological and economic benefits that may not be quite as tangible.
“The current forest tax program contributes an estimated 800,000 tons of carbon dioxide reduction, which is equivalent to the annual emissions from about 172,000 passenger vehicles,” the SOTS says. “The potential changes to this program are likely to further increase these statistics.
“Increasing enrollment in the forest tax law programs by just 10 percent and expanding eligibility to a 25 acre minimum parcel size would improve the estimated annual carbon benefit by approximately one million tons of carbon dioxide due to avoided conversion and improved forest management–the equivalent of removing about 215,000 vehicles from the road each year.”
The state Department of Environmental Conservation, which oversees the 480-a plan, says that forest owners who take part are committed for a 10-year period once they start getting the tax breaks. Owners who fail to follow the forestry plan can be forced to pay back-taxes.
“An owner must first decide if he or she is willing to commit land to the production of forest crops and to follow a management plan, prepared by a forester and approved DEC, for the next succeeding ten years beginning each year that they receive a tax exemption,” the DEC says. “This decision can be made only after an analysis of the investments required by the plan, income from forest product sales and associated stumpage.
“Eligible tracts must be managed primarily for forest crop production, although other compatible uses, such as forest recreation and watershed management can be allowed. A [forest management] plan identifies scheduled commercial harvests, noncommercial thinnings, road construction and other management practices. These practices are listed in a scheduled part of the plan that shows the work to be done each year.”
For more information on the 480-a law, go to www.dec.ny.gov/lands/5236.html.