By Robert Towe- A NOTE TO READERS: This week we depart from our usual format, and look at an important topic of interest to owners of forest land: How to obtain a present-use forest management plan for your property, and the many advantages it offers to you, and to your land. –rt
Today I’m walking a forest property northeast in the county, gathering field data for a forest management plan which will be submitted to the County tax department. These wise property owners want their property to be included in the present-use tax deferment program offered by the state of North Carolina to forest landowners. In addition to providing good forest management practices, a sound forest plan also reduces the property’s real estate taxes each year by a considerable amount, often less than half of the full market assessed rates, depending on several variables. (More on that below).
Good Reasons: So a well written forest plan makes very good financial sense, both now and later. Effective land management also conserves the relatively shallow soil base of steep mountain watersheds. Quality trout waters are highly subject to erosion caused by poor logging practices. Timber quality and growth can also be improved, and a diversity of wildlife populations enhanced with better management. The best plans are customized for each forest property, in keeping with beneficial timber harvest practices and the specific land-use objectives of the individual land owner.
In many years of working with mountain landowners as a forest naturalist and Realtor specializing in farms and forest land, I’m aware that many property owners are neither aware of nor well-informed about this valuable land use program. I am frequently asked several key questions about forest management plans. I will summarize a few of these important inquiries.
Qualifications: First, to qualify for the forest-use tax deferment, the subject property must have at least 20 acres in timber production. This may include old fields growing back into productive forest, plus all “stand types” with variable soils, timber age, size, density, species composition and logging history. If the forest property is not the owner’s primary residence, he or she must have owned it at least four years to qualify for forest use deferment. After acquiring a property with a forest plan already in place, the new landowner has 60 days to apply for continuing deferment, in order to be considered for entrance into the program. The old plan may need some revision.
The Need to Update: Many existing forest plans on the tax books for years are out of date, and need to be reviewed, to determine if the landowner is working with the guidelines of his or her forest plan. Progress is being made toward evaluating older forest plans. If your plan hasn’t been revised recently, it’s a very good idea to get it updated, or rewritten for present conditions, to remain in the present-use program.
Generally speaking, a forest management plan should be reviewed every five years, to make sure it’s current. Sometimes adjustments need to be made, especially if some of the deferred acreage is taken out of timber production, or if part of the forest acreage has been sold. When forest land under the present-use program is sold, the last three years’ deferred taxes become due. Annual real estate taxes continue to be deferred for the property each year, as long as it remains in compliance with the forest plan guidelines and objectives.
Timber Harvesting: The next important requirement to qualify for entrance into the program is an agreement to have the property’s timber harvested at some point in the future. Actual harvest dates depend on several variables including timber age, growth rate, stand density, accessibility, site specifics and again, landowner objectives. Some owners may decide to go with a longer harvest rotation, for increased revenues at a later date. Sawtimber is not like corn. It ripens very slowly toward maximum value, over the decades. The “best” time to harvest timber depends on several factors: growth rate, biological maturity, timber market conditions, the landowner’s needs, etc.
Clearcutting, i.e., removing all the merchantable and non-merchantable timber from a site, is not normally desired or recommended for privately owned mountain forests and watersheds. A forest owner may choose to have only the larger dominant trees harvested, specifying perhaps a 18-20” minimum stump diameter, or only the marked trees, rather than the more conventional practice of cutting everything above a 14” limit. The more conservative practice removes only the largest trees, leaving a healthy, denser stand of co-dominant trees rapidly growing toward forest crown-closure and future harvesting. The real estate sale value is also higher for less heavily timbered land.
Deferred Tax Rates: The actual amount of deferred taxes prescribed by the tax department for each forest property varies across the county. The primary variables determining value, and thus tax (and deferred) rates, are these: soil type, neighborhood location, the amount of acreage in forest use, and other site specifics. At whatever rate, it makes good sense to take advantage of the deferment offered.
Who Writes Forest Plans? Forest plans may be prepared by the state Forest Service, registered foresters, and by the landowner himself, in conjunction with and consulting directly with a qualified natural resource professional like myself. With Bachelor’s degrees in biology and environmental sciences from Appalachian State and in forest management from NC State, I write conservative plans which are more comprehensive than mere timber harvest prescriptions. As a forest naturalist I view each woodland holistically as a complex living community of soils, wildlife, commercial timber and non-timber species in a broader context of watershed, human recreation and aesthetic values. The emphasis and specifics of each forest plan vary with individual landowner’s objectives, as they should.
Stewardship of the Land: All these naturally interwoven components comprise a healthy forest and thus should all be included in a sound forest management plan that the owner will be pleased to use. A good plan is actually a tool for interpreting and enjoying the forest land as it grows and changes with the years, under our responsibility of wise stewardship of the natural resources entrusted to us. Mature ownership of valuable forest land is not all about real estate potential, timber revenues, or saving money on annual land taxes. Mountain forests also offer higher and more lasting values.
Important Timing…Applications for forest management plans are only received during the month of January for that year’s land taxes. So NOW is the time to get your plan prepared, for the 2017 tax year. There are many more details pertinent to each individual forest property. If this information sounds interesting to you, and you would like to get a sound working plan for your forest, or if you would like to update your present plan, please give me a call. I look forward to working with you on your forest land.
Robert Towe is a mountain forest naturalist, a fifth generation native of the area, and owner of Mountain Acreage, Inc., featuring above-average farms, forest land and retreat properties. He prepares forest management plans with mountain landowners, significantly reducing annual real estate taxes. View some of his inventory at mountain-acreage.com. Contact him directly at 828.253.7055 or firstname.lastname@example.org .