Legislative Update

Far left, Rep. Tom Casperson, R-Escanaba, Judy Augenstein, legislative consultant, Governor Jennifer Granholm, Senator Mike Prusi, D-Ishpeming, Kristen Kraft, Chief of staff to Senator Prusi, Ron DeCook, chief MDOT legislative liason. PA 136 was a bi-partisan effort put forth by MAT and TPA to correct a problem some log haulers were having with the log plate bill.

Shortly before the end of 2005 the Forestry Package was introduced to Michigan House of Representatives. The issues being addressed in this package are Factor Limits on Michigan State Forest lands, Commercial Forest Act (CFA), Private Landowner Incentives and Renaissance Zones. I provided testimony as to the impacts of these bills on our industry and how they would help stimulate forest management not only on private lands but state lands as well. Needless to say these bills have been facing opposition from the beginning.

Annually ten percent of Michigan’s state forest land is inventoried, equating to roughly 390,000 acres. Acres that meet silvicultural criteria or harvest criteria, roughly 90,000acres, are noted. However, some of these 90,000 acres have harvest restrictions placed on them called "Factor Limits" or "Limiting Factors". The Department has forty (40) separate limiting factors (reasons) that commercial logging is either temporarily or permanently not allowed on designated areas of state forests. The list of limiting factors includes everything from "federal law" prohibition to "timber contractors not available". There was no public input into the development of the list of limiting factors or into any additions to the list. The proliferation of reasons to exclude commercial logging from state forests has resulted in a significant number of acres that are not receiving any conservation treatment. Approximately 30,000 acres are factor limited on an annual basis leaving roughly 60,000 acres available for harvest. The factor limit bill is looking to decrease the amount of acres restricted on an annual basis by factor limits. Needless to say there has been strong opposition to this bill from DNR and other environmental groups. This bill is currently in committee on the Senate side and hopefully will be voted out of committee soon after the Spring Break.

The CFA bill received great scrutiny as well. A trade off for the great tax break for being enrolled in the CFA program was the landowner could not deny foot access to hunt or fish on this property. Many parcels of the CFA property have become landlocked over the years and a concern is that they are no long accessible. There was a great push to make sure all CFA land provide, in some cases, legal access. We felt that land prior to 1995 should be grandfathered and not penalized for land transactions that were out of the CFA owners hands, which could have resulted in reduced access. One of our concerns was that landowner enrolled in CFA program that didn’t own the mineral rights would be penalized if they had oil or gas well put on their property. Another issue was re-evaluating the tax payment. The Michigan Treasury Department has not followed this program and thus a reasonable rate increase could not be determined. Marquette County did track CFA land in their county and proposed a tax increase; however, this was not acceptable to all parties. This bill is currently tabled.

The private landowner bill is requesting a tax break for private landowners who are actively managing their forest and meet the requirements of this bill. The requirements are to own more then 20 acre but less then 100 and your property must be capable of producing 50 cubic feet of wood per acre per year. These parameters were put into place to limit the enrollment and financial burden to local municipalities. Those who meet these requirements while managing and harvesting their forest will receive an 18 mil tax break. The financial burden to local municipalities would be made up from the State’s general fund. This bill had been passed out of both the House and Senate committees and will be taken up on the House floor after the spring break.

The Renaissance Zones Bill is looking to create tax free areas around the state to encourage forestry based companies to locate in Michigan. There were provisions to allow for facilities to create alternative energy or fuels. Currently, there are agricultural zones to allow agricultural based companies or facilities to come into Michigan.

This has been a long frustrating road these bills have taken. I have spent a lot of time in Lansing testifying in support of these bills. Once I remained neutral because a new version was presented the morning of my testimony and I had not had time to receive the new document.; we later supported this piece. We will continue to support this package as it has great potential in stimulating our forest management and forest industry.

Our amendment to the Log Plate bill has been passed out of both committees and should not have any problem passing through the House. The amendment was made to better clarify what could be hauled on the log plate. We did face some opposition from Secretary of State and Michigan Department of Transportation. However, through the hard work of many people, including Denny Olson, these issues were result very quickly.