Fed state incentivizing woodlot management

July 2, 2010
| By Pete Daly |
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Proposed legislation that would encourage greater participation in the state’s forest management program to increase private timber supply has been co-sponsored by Sen. Gerald Van Woerkom, R-Norton Shores.

The House has a similar bill under consideration, and Van Woerkom said the measures will persuade more forest landowners to enroll in the state government’s Qualified Forest Property program.

“The lawmakers adopted legislation five years ago that offered tax exemptions to private landowners for managing their forestland,” said Van Woerkom.  “As part of the plan, we also developed penalties for anyone who decided to withdraw from the program after receiving the tax exemption. Unfortunately, the penalties were so high that very few landowners have enrolled in the program, so we hope this new legislation will fix that problem.”

Under the Qualified Forest Property program, landowners receive a property tax exemption if they have more than 20 contiguous acres, of which 80 percent is productive forest, and if they adhere to an approved forest management plan.

Van Woerkom said the goal was to have 1.2 million acres enrolled, but instead only slightly more than 50,000 acres are now part of the program. 

Senate Bill 1400 would reduce the recapture penalty to the number of years enrolled in the program times the amount of the exempted millage rate, with a maximum of seven years as the multiplier.

House Bill 6292 would make several changes to the program, including:

  • Raising the amount of acreage under which an exemption could be applied from 320 acres of qualified forest property to 640 acres.

  • Clarifying that qualified forest property can have buildings or structures on it.

A federal incentive that became available a year or two ago through the Environmental Quality Incentive Program, administered by the Natural Resources Conservation Service within the U.S. Department of Agriculture, has no minimum acreage requirement, according to Matt Soehnel of the NRCS office in Kent County.

Soehnel said that program usually covers about 75 percent of the cost of a woodlot inventory and management plan prepared by a certified forestry consultant. So far, only one property owner in Kent County has enrolled in the EQIP program, a five-acre woodlot in the southern end of the county.

Jack Boss of Lowell, a certified technical services provider for the federal woodlot management program, said many small woodlot owners are unable or unwilling to pay the entire cost of an inventory and timber management plan, for which he typically charges at least $1,000.

“If you leave a woodlot to go its own way, there’s going to be a lot of waste and lost value,” said Boss. He explained that removing certain trees that will never have high value will provide growing room for others that will. That, in turn, will increase the value of the property as the timber approaches maturity.

“People just aren’t aware of these things,” said Boss, referring to woodlot management incentives that have been offered by government on and off over the years.

Boss said he knows a landowner who had 80 acres of forested property, with his house in one corner. He had the two-acre house lot divided from the rest of the property as a separate parcel, and then was able to enroll the other 78 acres in the Qualified Forest Property Tax Program and is “paying school tax on two acres now.”

Jerry Tomandl, the forester for West Michigan Sawmill in Clarksville, said some woodlot owners would be interested in management plans in return for a government incentive, but “other people just don’t want government involvement at all.”

Tomandl said when the federal incentive came out, he recommended it to a number of woodlot owners. “More than half the people said, ‘Nothing doing.’ They just want no part of any kind of a federal program,” he said.

Although the standing hardwood timber market had been depressed for the last few years, Tomandl said the market right now for black walnut and red oak trees is “booming,” but he added that “six months from now, it will be something else.”

The market for standing timber goes “up and down,” he said.

Why is the market hot right now for black walnut and red oak?

“Exports, I think,” said Tomandl. “I think China is buying. They say there’s Chinese walnut buyers” in Michigan. He said West Michigan Sawmill, a “rough green mill” that sells raw lumber to brokers, has not sold to any Chinese buyers, “but several other dealers I know of have been selling to them.”

Will Borden, general manager of Quality Hardwoods in Eaton County, and a board member for the Lake States Lumber Association, said the proposed state legislation would provide “an incentive for landowners to selectively harvest timber in Michigan,” which will create jobs and help the economy.

“I hope the legislature will pass this legislation in a timely manner,” said Borden.

“Michigan has one of the largest amounts of harvestable timber that remains unused,” said state Rep. Darwin Booher, R-Evart, who introduced some of the legislation in Lansing.

Sen. John Gleason, D-Flushing, and Rep. Joel Sheltrown, D-West Branch, have introduced similar bipartisan bills to mirror support for the legislation.

The legislation has been referred to the Senate Finance Committee and the House Committee on Tourism, Outdoor Recreation and Natural Resources.

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