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Legislative Memo

Darren Suarez
Director of Government Affairs
T 518-694-4462
www.bcnys.org

BILL:

S.7508 / A.9508 (Budget, Part Z)

Support

SUBJECT:

Empire Forests for the Future Initiative

 

DATE:

February 26, 2018

 

The Business Council strongly support the adoption of this legislation that would modify the existing forestry property tax law (480a), create a new property tax incentive for privately owned forests and open space (480b).   Adoption of the proposed legislation will have significant economic, environmental and societal benefits because it will help to preserve New York's working forest lands.  The proposed reforms to the 480-a Timber Tax law will reduce barriers to participation and will have the added benefit of increasing the amount of managed private forest lands.  The Business Council is pleased to join our fellow supporters of New York's private forest lands in supporting the Empire Forest for the Future Initiative.

Specifically, the Empire Forests for the Future Initiative would amend real property tax law to streamline processes for private forestland owners who are currently in a tax abatement program authorized under section 480-a, and create a new program that would open participation to landowners with 25 or more acres. The provision would also create two ways to participate, through enrollment in a third-party certified sustainability program or through a state-approved plan for sustainable management action, which can enhance forest habitat for wildlife, water quality or sequester carbon. It would also allow for the inclusion of limited non-forested open space in the program and a formula for state-funded relief for local governments that, in some cases, are currently forced to shift the tax burdens of privately-held forest lands to other local taxpayers.

New York State has a long history of understanding that property tax liabilities can directly affect land use decisions.   Even before the adoption of the Fisher Forest Tax Law (RPTL Section 480) New York has provided reduced or deferred taxation on forest property.   Those laws were repealed by Chapter 610 of the Laws of 1926 which was based upon the yield tax principle where land was taxes yearly as if the timber was absent, once the land was harvested, the removed timber was taxed.  Additionally the value of the land could not increase once an application was received.  The Fisher Tax Law proved overtime to be ineffective.

In 1977, Section 480-a replaced the Fisher Tax Law, property enrolled under the old law could either remain under the provisions of the old Law or elect to apply for certification under Section 480-a.   The 480-a program provides eligible landowners with an eighty percent in the assessed value of the wooded parcel.   To be eligible an owner must enroll at least 50 contiguous acres, have a forest management plan developed by a professional forester, and commit to follow the prescribed forestry management activities in that plan.   Unfortunately, 480-a has proven to be inadequate and has resulted in the only seven percent of forest land enrolled, which is the lowest owner participation in the country.  There are numerous reasons that the enrollment has been very low, many of those reasons are addressed in the proposed amendments. 

It should be noted that the legislative proposal is truly comprehensive containing many provisions that the Business Council supports, but we are concerned that some of the enactment of a stat wide Commercial Timber Harvest Notification Law as currently drafted in the proposal will be an additional regulatory burden and should be amended to reflect concerns of the forest products business. 

In conclusion the Business Council strongly support the adoption of this legislation that would modify the existing forestry property tax law (480a), create a new property tax incentive for privately owned forests and open space (480b).