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Non-Industrial Private Forests. Karen Potter-Witter Department of Forestry. Michigan. 19.2 million acres of forestland 18.6 million acres of timberland ~ ___% of Michigan?. Percent forestland by county. Timberland by forest type. Timberland area by region. Timberland ownership, 1955-93. - PowerPoint PPT Presentation
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Non-Industrial Private ForestsNon-Industrial Private ForestsNon-Industrial Private ForestsNon-Industrial Private Forests
Karen Potter-WitterDepartment of Forestry
MichiganMichiganMichiganMichigan
• 19.2 million acres of forestland
• 18.6 million acres of timberland
• ~ ___% of Michigan?
Percent forestland by countyPercent forestland by countyPercent forestland by countyPercent forestland by county
Timberland by forest typeTimberland by forest typeTimberland by forest typeTimberland by forest typepine
spruce-fir
n. white cedar
hemlock
other softwoods
sugar maple
soft maple
aspen
red oak
ash
basswood
paper birch
white oak
yellow birch
beech
elm
other hardwoods
Timberland area by regionTimberland area by regionTimberland area by regionTimberland area by region
UP NLP SLP0
2,000
4,000
6,000
8,000
10,000
Thou
sand
Acr
es
UP NLP SLP
1938 1955 1966 1980 1993
Timberland ownership, 1955-93Timberland ownership, 1955-93Timberland ownership, 1955-93Timberland ownership, 1955-93
1955 1966 1980 19930
2,000
4,000
6,000
8,000
10,000
12,000
Tho
usan
d A
cres
1955 1966 1980 1993
Local govt. Federal Forest Industry State Private Non-industrial
BackgroundBackgroundBackgroundBackground
• 312,000 NIPF owners in Michigan
• own 54% - 8.6 million acres of forest
• 40 % of ownerships are 1-9 acres
• 32% acquired from 1970-1979
FragmentationFragmentationFragmentationFragmentation
8 counties with >15% growth and 50% forest area
Chippewa 19%
Crawford 30%
Grand Traverse 17%
Kalkaska 23%
Missaukee 21%
Montmorency 19%
Otsego 20%
Roscommon 21%
TrendsTrendsTrendsTrends
• More demand for recreation use and amenities from forests
• More objection to timber harvests
• More reliance on private lands for timber
• More fragmentation and accompanying ecosystem challenges
Why have private lands policy?Why have private lands policy?Why have private lands policy?Why have private lands policy?
to promote sustainability
to encourage investment
to increase production
to minimize negative impacts
Major instrumentsMajor instrumentsMajor instrumentsMajor instruments
Financial IncentivesTaxesCost sharing
Technical AssistanceIn the field Educational programsApplied research
Income taxIncome taxIncome taxIncome tax
Major elements:
$ income
$ expenses
$ reforestation
Federal Income TaxFederal Income TaxFederal Income TaxFederal Income Tax
$ Income - Capital Gains
$ maximum tax rate lower than for other income
$Expenses
$ reduces the net cost to the taxpayer
Reforestation Amortization & Reforestation Amortization & Tax CreditTax CreditReforestation Amortization & Reforestation Amortization & Tax CreditTax Credit
reduces the net cost of tree planting
for timber through deduction, plus:
an investment tax credit
Property taxesProperty taxesProperty taxesProperty taxes
• Reduction in mileage rate, special classification or separate from ad valorem
• Ad valorem - most non-industrial
Commercial Forest ProgramCommercial Forest ProgramCommercial Forest ProgramCommercial Forest Program
$1.10/acre per year
public access for hunting and fishing required
minimum of 40 acres
Private Forest Reserve ProgramPrivate Forest Reserve ProgramPrivate Forest Reserve ProgramPrivate Forest Reserve Program
• a few farm woodlots
• 160 acres or less
• ½ in active agriculture
• up to 40 acres can be in PFR
• assessed at $1 per acre
• 5% yield tax
Technical assistance – Technical assistance – federal+state+local+privatefederal+state+local+privateTechnical assistance – Technical assistance – federal+state+local+privatefederal+state+local+private
DNR or other foresters and resource professionalsCooperative Forest Management in MIA few Soil Conservation District Foresters leftCounty foresters in some states (e.g. Minnesota)Industry foresters
Land Grant UniversitiesLand Grant UniversitiesLand Grant UniversitiesLand Grant Universities
• Extension
• Education
• Training
• Applied research
Regulation – federal, state, Regulation – federal, state, locallocalRegulation – federal, state, Regulation – federal, state, locallocal
ESA
Clean Water Act
BMPs
Zoning
Cost sharing – federal+stateCost sharing – federal+stateCost sharing – federal+stateCost sharing – federal+state
• ACP – Agricultural Conservation Program
• CRP – Conservation Reserve Program
• FLEP - Forest Land Enhancement Program
• Forest Stewardship Program
• Many others – Wildlife (WHIP), T&E species
ResourcesResourcesResourcesResources
www.timbertax.org/
forestry.msu.edu/extension/
www.reeusda.gov/nre/forestry/
www.na.fs.fed.us/