treegrowth plan (good/bad) (Bangor, Augusta: sale, assessor, homes)

[boonelsewhere]

My though tend to go along with NMLM example. What you think.

this is from Maine.gov

• Determination of penalty--the penalty will be an amount equal to 30% of the difference between the 100% Tree Growth valuation (of the classified land on the assessment date immediately preceding withdrawal) and
the fair market value of the property on the date of withdrawal. If the land has been classified for more than 10 years, the following percentages shall apply.

10 years or less 30%

11 years 29%

12 years 28%

13 years 27%

14 years 26%

15 years 25%

16 years 24%

17 years 23%

18 years 22%

19 years 21%

20 years or more 20%

• Fair market value--fair market value at the time of withdrawal is the assessed value of comparable property that is not valued on a current use basis in the municipality adjusted by the municipality's certified assessment ratio.

NMLM,

The worst case scenario is that the state will take 30% of the value of your property when you take it out of tree growth. Suppose you own land on a lake and that land is in tree growth. It is valued under the tree growth program at $85 an acre. You sell a 5 acre lot on the water for $150,000.
The state will send you a tax bill for $45,000. There are lake front lots worth $150,000 in Maine. If that lot had never been in the tree growth program there would be a capital gains tax, but nothing like 45 grand.

zymer,

As I read the law, the penalty is not a percentage of the value of the land,
rather it is a percentage of the taxes that were not paid (that would have been paid without the exemption):

to put number on what zymer said. we will use mil rate of $15 per $1000,

Penalty:
150000 x .015 x .30 = $675.00

[kellysmith]

I bought a 4 acre parcel about 10 years ago and paid $4000 for it and paid about $500 to take it out of tree growth. It had been in tree growth less than 10 years. To me it seemed like it was calculated like NMLM says, not the way zymer's got it figured. I think the penalty is based on the land valuation, not mil-rate and valuation. I would think it would be scary to pay the penalty required to get a very valuable piece of property out of tree growth. Another aspect if you buy less than 10 arces is it had to come out of tree growth because you needed at least 10 acres to submit a forestry plan for tree growth. (at least that was the way it was when I got this piece of property.)

[msina]

Boonskyler it seems you have done a lot of study and, that you are becoming very well informed in treegrowth rules. I believe you have learned much and have your facts correct. The only suggestion I can think of is, ask the person that comes to walk your property if this is indeed correct, that person will likely know the way the formulas work very well. Best of luck to you.

[Northern Maine Land Man]

The longer the time a parcel has been in tree growth, the greater the penalty. If it has only been in for four years, for example, the penalty is much less than if it had been in for 30 years. The logic behind that is that the landowner has received a tax break for 30 years which can be very substantial. If the prior owner only had it in for four years he received a far smaller benefit. the law follows the land, not the owner. If a parcel is sold under the tree growth plan, the new owner has one year from the date of closing to state whether he wants to leave it in tree growth or take it out. If he makes no decision the town send him a huge bill and it's high fives all around because the town just got a cash windfall. Don't let your tree growth plan lapse.

Suppose the prior owner has his land in tree growth and his 10 year plan expires on June 15. You close on the land on June 5. The town officials wait like vultures in the hopes you don't notice. If you don't find yourself a forester and have him prepare you a tree growth plan by June 15 you get a really big bill. Does all this sound like a really neat way to trap unsuspecting land owners? You betcha. It is completely intentional.

If you want to buy some land and it is in tree growth, get your contact person, whether it's the owner or a broker, to provide you with a copy of the tree growth plan so you will know when it expires. If the expiration date is in May and you are scheduled to close in June, be absolutely sure the seller renews the plan before you buy the land. That doesn't mean the seller shows you a plan signed by a forester. It means you get the copy of the plan from the town where it was actually received and accepted.

I don't use the word, "vulture" lightly. Here is the story of a soldier from Maine who was doing convoy duty every day in Iraq with a .50 cal machine gun.

"COPYRIGHT 2006 Bangor Daily News
Byline: Diana Bowley

Mar. 9--BROWNVILLE -- A Brewer Army Reservist who spent a year serving his country in Iraq is now engaged in a battle on the home front. Steve Campbell, 39, claims that the town of Brownville violated the federal Serviceman's Civil Relief Act because town officials removed his Brownville land from tree growth while he was in Iraq, and then presented him with a nearly $6,000 supplemental tax bill as a penalty. "I was over there doing convoy security missions while they were over here assessing me tax bills," Campbell said Wednesday. Whether property in tree growth is covered under the federal relief act is a vague issue that may have to..." This is still pending.

As the old police sergeant used to say on NYPD Blue. "Be careful out there."

[Submariner]

I bought land in 'treegrowth' from a forester.

The state sent me a brochure telling me that I would need to contract a forester for a 'Forestry Management Plan', within one year of the date of my purchase.

The seller recommended a Forester that I could use. I contacted him and he was already familiar with this parcel.

The brochure from the state said that my 'Forestry Management Plan' would be my private property. A form came with it that the Forester signed saying that he had in fact formed a 'Forestry Management Plan' and given it to me. And I mailed the signed form to the state.

It is my understanding that I am the only person who holds this 'Forestry Management Plan'. The state only has a signed form stating that the 'Forestry Management Plan' exists.

It is good for 10 years.

I also have taken 1 acre of land out of treegrowth. We paid a penalty for taking that one acre out of treegrowth. That penalty was 96% of the per acre purchase price of the property. The State tax assessor [Lisa Whynot] told me that she had to use their 'Market Value' of my property, being waterfrontage and not the sale price. The state's 'Market Value' of land in Maine appears to be far far above the actual sale prices of land in Maine.

Since I have lived here and been building, the property next to mine on the North side was sold. The new owner has spoken with me many times, he wanted desperately to take all of his property out from 'Treegrowth', including about ten acres of wetland]. I advised him to only take out that portion of land that he truly 'need's to have out of treegrowth. He dis-agreed, saying that he wanted to own forest without the state's control over him. Telling him what he can and can-not do with his land. He went to Augusta and the state tax assessor told him that if he takes it out of 'Treegrowth' the 'penalty' will be far higher that what he paid when he bought the land.

The last time that I saw him, he appeared 'shell-shocked' that he will be forced to keep his woodlot as a woodlot.

I find it humorous in that his only plan for the property has been to drop a cabin on skids at the center of the parcel.

My 'Forestry Management Plan' would most certainly allow me to drop a cabin like that within the Treegrowth. I should think that his 'Forestry Management Plan' will allow him to do this as well.

[AliceT]

So if I had 60 acres and only really wanted to develop 1/2 acre for my homestead and barn, I could put the rest in treegrowth and still have it for picking berries, keeping beehives and planting a garden.

The advantage for me would be to keep the taxes at a rate I can afford in later years as my limited income becomes more permanent. That's assuming that Maine's population continues to grow as more and more people discover the beauty of the way life should be. More people = more taxes.

[Northern Maine Land Man]

The tree growth system only deals with whole acres. If you own 47.68 acres you must take a whole acre out of the plan. That would leave you with 46.68 acres in tree growth. Make sure your buildings and septic system are in the acre you take out.

If the existing forestry plan has three years to go when you buy your land you can just send in a form stating you want to continue with the existing plan. The most cost effective way to renew your plan as you approach 10 years is to have the same forester write your new plan. That's assuming he's still alive. Maine's foresters are an aging group just like the rest of our population. If you go with a new forester, ask to see one of the plans he has prepared. Make sure he has not sabotaged the property for future use. Some foresters have come from places Like Unity College and are far more interested in the denizens that inhabit the topsoil than in enhancing the value of the stand of trees on your property. Any forester recommended by the man who forest beekeeper bought his property from will write you a good plan.

More people don't mean more taxes. We have a town here with one student in school. When he graduates next year there will be no more students to educate. As it is, the town pays $7,800 per year to the nearby district for his tuition. There will be no more kids because the remaining population is beyond their child bearing years. Don't get me wrong. I'm just describing the situation as it exists. I would love to see new young families coming to Maine instead of leaving Maine.

[Submariner]

Originally Posted by AliceT

So if I had 60 acres and only really wanted to develop 1/2 acre for my homestead and barn, I could put the rest in treegrowth and still have it for picking berries, keeping beehives and planting a garden.

The advantage for me would be to keep the taxes at a rate I can afford in later years as my limited income becomes more permanent. That's assuming that Maine's population continues to grow as more and more people discover the beauty of the way life should be. More people = more taxes.

Woodlots are good to have, going through them and cleaning out the dead wood can keep you in firewood nicely.

Ginseng grows well on a forest floor, as does mushroom innoculated logs.

Goats, sheep and chickens all do well in a forest.

[wnc-eky-me]

Originally Posted by Northern Maine Land Man

The tree growth system only deals with whole acres. If you own 47.68 acres you must take a whole acre out of the plan. That would leave you with 46.68 acres in tree growth. Make sure your buildings and septic system are in the acre you take out.

If the existing forestry plan has three years to go when you buy your land you can just send in a form stating you want to continue with the existing plan. The most cost effective way to renew your plan as you approach 10 years is to have the same forester write your new plan. That's assuming he's still alive. Maine's foresters are an aging group just like the rest of our population. If you go with a new forester, ask to see one of the plans he has prepared. Make sure he has not sabotaged the property for future use. Some foresters have come from places Like Unity College and are far more interested in the denizens that inhabit the topsoil than in enhancing the value of the stand of trees on your property. Any forester recommended by the man who forest beekeeper bought his property from will write you a good plan.

More people don't mean more taxes. We have a town here with one student in school. When he graduates next year there will be no more students to educate. As it is, the town pays $7,800 per year to the nearby district for his tuition. There will be no more kids because the remaining population is beyond their child bearing years. Don't get me wrong. I'm just describing the situation as it exists. I would love to see new young families coming to Maine instead of leaving Maine.

Hey NLML not all of us who will go to Unity will be like that. When I graduate in 2 yrs and get my license I would be glad to write a management plan for any landowner that suits that landowners longterm goals if they are siivicultarally sound. But things like soil quality and water quality has to be taken into account otherwise you are just abusing your own land. But I guess some foresters take it too far as far as environmetalism is concearned. I believe that you have to cut trees to have a healthy forest, and once a stand has reached it's economic maturity it has to be cut as soon as markets and weather permit. But you have to cut with the future in mind, you can't just high grade your land and expect anything worthwhile to come back.

I also have seen people who get into these programs just for the tax break and are not interested in cutting trees at all. And get mad at forester who has the audacity to write a plan that has cutting in it. But as a Future Forester I couldn't write a plan for this person that says that if they have over mature dying trees, there isn't any "tree growth" going on so you have to cut and replant or let come back natural if feasible.

I personally think people need to plan ahead and think "do I ever want to sell this land or farm it?" If so then don't put land in tree growth. It is all about planning and you guys getting this topic started is a good thing so maybe some people who are thinking about the program will take the time so sit down and think is the savings worth the control and future penality.
S

[Submariner]

Originally Posted by Northern Maine Land Man

The tree growth system only deals with whole acres. If you own 47.68 acres you must take a whole acre out of the plan. That would leave you with 46.68 acres in tree growth. Make sure your buildings and septic system are in the acre you take out.

Good point.

When I took one acre out of 'Treegrowth', that one acre was not mapped. It could lay anywhere on my 42 acres.

I am making a point of not developing anything more than one acre. If anyone did come along and wanted to know exactly where that one acre lays, I could roughly point it out as being where my house, driveway, septic, well and garden rests.

But so far nobody has come along with the desire to check up on me.

... If the existing forestry plan has three years to go when you buy your land you can just send in a form stating you want to continue with the existing plan. The most cost effective way to renew your plan as you approach 10 years is to have the same forester write your new plan. That's assuming he's still alive. Maine's foresters are an aging group just like the rest of our population. If you go with a new forester, ask to see one of the plans he has prepared. Make sure he has not sabotaged the property for future use. Some foresters have come from places Like Unity College and are far more interested in the denizens that inhabit the topsoil than in enhancing the value of the stand of trees on your property. Any forester recommended by the man who forest beekeeper bought his property from will write you a good plan.

It has become my understanding that the ten year clock on a 'Forestry Management Plan' gets reset to one year when ownership changes.