This Dept of Revenue gives a simple explanation Forestland and its tax assessment intent:
https://www.oregon.gov/DOR/programs/property/Pages/timber-forestland-tax.aspx
Introduction:
Property in Oregon is valued and taxed based upon the real market value—the price the land would sell for on the open market. The Legislature recognized that urban areas are encroaching on lands capable of growing timber. Legislators also recognized that this drives up the value and tax on these properties and makes holding these lands while the timber is growing more expensive. This is why Oregon offers special assessment programs to forestland owners. These programs reduce the property tax the landowner pays if they agree to manage the property primarily for growing and harvesting timber.
The question is: Why does the city of Bend, Oregon have a total of approximately 100 acres of Designated Forestland assessed at a value of $79.38 per acre within the city limits. The urban area has already encroached on the forest! Without the Forestland Designation these same properties totaling approx. 100 acres would be assessed at about $250,000 per acre.
I sent an email to Deschutes County Representative Buehler regarding this situation
and providing factual information regarding specific properties within the city that are assessed at the Designated Forestland rate.
https://www.blogger.com/blogger.g?blogID=1176829519333181968#editor/target=post;postID=6110653029596981719;onPublishedMenu=allposts;onClosedMenu=allposts;postNum=0;src=link
He never replied. Never acknowledged receipt.
This is Washington's explanation of the assessment valuation of Forestland in that state:
http://apps.leg.wa.gov/RCW/default.aspx?cite=84.33.130
Purpose—1981 c 148: "(1) One of the purposes of this act is to establish the values for ad valorem tax purposes of bare forestland which is primarily devoted to and used for growing and harvesting timber without consideration of other potential uses of the land and to provide a procedure for adjusting the values in future years to reflect economic changes which may affect the value established in this act.
(2) Chapter 294, Laws of 1971 ex. sess., as originally enacted, required the department of revenue annually to analyze forestland transactions to ascertain the market value of bare forestland purchased and used exclusively for growing and harvesting timber. Most transactions involving forestland include mature and immature timber with no segregation by the parties between the amounts paid for timber and bare land. The examination of these transactions by the department to ascertain the prices being paid for only the bare land has proven to be very difficult, time consuming, and subject to recurring legal challenge. Samples are small in relation to the total acreage of forestland involved and the administrative time and costs required for the annual analyses are excessive in relation to the changes from year to year which have been observed in the value of bare forestland. This act eliminates most of these administrative costs by establishing the current bare forestland values and by providing a procedure for periodic adjustment of the values which does not require continuing and costly analysis of the numerous forestland transactions throughout the state."
Washington Designated Forestland
"
- "As a way to encourage commercial forestry in Washington State, landowners may choose to have their land designated as forest land. This designation often results in a lower assessed value and lower taxes. Specific requirements must be met to qualify for this designation."
"The assessed value of designated forest land was set in state statute, and in 2014 ranged from $1/acre to $189/acre, based on soil productivity and the ease/cost of timber extraction. Current values can be found on the State Department of Revenue website at: http://dor.wa.gov/content/findtaxesandrates/othertaxes/timber/forst_lvs.aspx.
In contrast, assessed fair market value could be thousands of dollars per acre. So, designating your land as forest can reduce your tax burden by up to 99 percent on the forested portion of your property. The tax assessment for the residential portion of your property and any structures would not see a reduction.".......
"Is This Special Designation Fair?
Some people have raised objections to this lower tax status program, claiming that it’s not equitable to decrease the tax burden on forest land, because that increases the tax burden on other land. Others, however, note that forestland owners are expected to provide public benefits with no compensation, and also have many regulatory constraints imposed upon them by the public. ......
Eighty studies nationwide by the American Farmland Trust and others on the cost of community services have found that forest lands contribute far more in taxes than they require in public services (37 cents in services needed for every $1.00 of tax revenue produced). Residential lands, on the other hand, require more in public services than they contribute in taxes ($1.19 in services needed for every $1.00 of tax revenue produced)."
The preceding is an interesting way of looking at the low tax on Designated Forestland. It gets an "A" for creative thinking. It deserves some logic and reason analysis.
Is this a valid basis for the formation of tax policy supporting community services?
"forest lands contribute far more in taxes than they require in public services"
https://timbertax.org/statetaxes/states/summary/oregon/
https://timbertax.org/statetaxes/states/summary/washington/
Oregon Forest land Protection Program
https://www.oregon.gov/LCD/pages/forlandprot.aspx
In contrast, assessed fair market value could be thousands of dollars per acre. So, designating your land as forest can reduce your tax burden by up to 99 percent on the forested portion of your property. The tax assessment for the residential portion of your property and any structures would not see a reduction.".......
"Is This Special Designation Fair?
Some people have raised objections to this lower tax status program, claiming that it’s not equitable to decrease the tax burden on forest land, because that increases the tax burden on other land. Others, however, note that forestland owners are expected to provide public benefits with no compensation, and also have many regulatory constraints imposed upon them by the public. ......
Eighty studies nationwide by the American Farmland Trust and others on the cost of community services have found that forest lands contribute far more in taxes than they require in public services (37 cents in services needed for every $1.00 of tax revenue produced). Residential lands, on the other hand, require more in public services than they contribute in taxes ($1.19 in services needed for every $1.00 of tax revenue produced)."
The preceding is an interesting way of looking at the low tax on Designated Forestland. It gets an "A" for creative thinking. It deserves some logic and reason analysis.
Is this a valid basis for the formation of tax policy supporting community services?
"forest lands contribute far more in taxes than they require in public services"
https://timbertax.org/statetaxes/states/summary/oregon/
https://timbertax.org/statetaxes/states/summary/washington/
Oregon Forest land Protection Program
https://www.oregon.gov/LCD/pages/forlandprot.aspx
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