cost-share, income tax, property tax ... Paying Taxes to Caesar (Matthew 22:15-22; Luke 20:19-26) ... return to their original home states every so often to.
Natural Resources Private Land Policy Tools Fred Cubbage Department of Forestry and Environmental Resources North Carolina State University Lecture Presented in Natural Resource Policy and Management NC State University, Raleigh, NC
UPDATED 4 NOVEMBER 2018
Bundles of Rights Associated with Land Users Level of Rights / Title
Owner
Proprietor
Claimant
Authorized User
Entrant/ Viewer
Access
X
X
X
X
X
Withdrawal
X
X
X
X
Management
X
X
X
Exclusion
X
X
Alienation/ Sale
X
Adapted from Schlager and Ostrom (1992), Ostrom and Hess (1991)
Private Land Policy Alternatives Markets Education (exhortation) > extension/information, technical assistance
Incentives (subsidies) > cost-share, income tax, property tax
Regulation/Best Practices (coercion) > BACTs, BMPs, water laws, etc
Land purchase/conservation easements Payments for environmental services Organics, industry/ENGO certification
Technical Assistance Landowner Education and Advice Cooperative extension > landowners, urban residents, professionals > rural development Industrial extension State forestry & wildlife assistance > timber and forest management > seedlings > fire, insect and disease control > multiple use, water quality, BMPs > urban forestry & wildlife Wildlife management assistance > Management plans > Habitat management
Indirect Natural Resource Management Technical Assistance Research > Hatch and McIntire-Stennis federal funds to states > USDA ERS, APHIS, NRLI, etc. > USDA Forest Service > Fish and Wildlife Service Education > Cooperative Research Education and Extension Service > Natural resource, forestry, wildlife schools / ccs Natural Resources Conservation Service Farm Service Agency – loans, insurance, etc Cooperative associations USDA plant, animal, organics certification
Taxes: They Are Not New Paying Taxes to Caesar (Matthew 22:15-22; Luke 20:19-26) 13And they send unto him certain of the Pharisees and of the Herodians, to catch him in his words. 14And when they were come, they say unto him, Master, we know that thou art true, and carest for no man: for thou regardest not the person of men, but teachest the way of God in truth: Is it lawful to give tribute to Caesar, or not? 15Shall we give, or shall we not give? But he, knowing their hypocrisy, said unto them, Why tempt ye me? bring me a penny, that I may see it. 16And they brought it. And he saith unto them, Whose is this image and superscription? And they said unto him, Caesar's. 17And Jesus answering said unto them, Render to Caesar the things that are Caesar's, and to God the things that are God's. And they marvelled at him. http://biblehub.com/kjv/mark/12.htm
Roman Census and Taxes Rome carried out a regular sequence of the census in the provinces (every seven years - the one at Jesus' birth being the first "world-wide" one, though they had been held in some provinces before this), and in each such case there was a "year of enrollment" wherein each individual had to register his/her property in his/her official place of residence. This, of course, was a much more crucial thing in the ancient world than it is today, for citizenship and civil rights were tied to localities for non-Roman citizens (so that this would be analogous today of U.S. citizens having to return to their original home states every so often to maintain their rights and pay their taxes). This is the reason why Joseph and Mary had to journey to Bethlehem http://ichthys.com/mail-Mary.htm
Ephesus Sign: Ad Valorem Taxes ❑
❑
❑
We have gathered as a result of extensive investigation to determine the quantity (as well as the quality) of the land the public has in Asia, and the annual (tax) payment they could (pay)… All over Asia Minor 6737.5 iuga with fertile soil suitable for agriculture that supplies and extra 3000 solidi (units) of crop over the pre estimated (calculated) quota of 8000 solidi and 703 iuga of infertile land will be protected under your control with no objection whatsoever. We urge you to investigate all the estates throughout Asia to find out the actual quantity of the iuga and…the present owners and their potential contribution to the annual budget, and also the estates rented by the wealthy, or the barren, worthless land granted to the state officials, a loss to our budget.
Death and Taxes Benjamin Franklin (1706-90) used the form we are currently more familiar with, in a letter to JeanBaptiste Leroy, 1789, which was re-printed in The Works of Benjamin Franklin, 1817:
"'In this world nothing can be said to be certain, except death and taxes.“ http://www.phrases.org.uk/meanings/death-and-taxes.html
Property Tax Primary funds for county, city, local taxes Schools, roads, police, fire, sanitation, parks, community centers, etc. Ad valorem – “On Value” > Real and personal property > Land, crops, houses, timber, houses, vehicles, stocks, businesses, etc. Assessments > Fair market value > Assessed value Total Budget / Total Taxable Value = Millage Rate Millage Rate * Assessed Value = Tax
Property Tax – Millage Rate The millage rate can be found on the property tax statement or by contacting the local treasurer. Millage rate is the rate at which property taxes are levied on property. A mill is 1/1000 of a dollar. Property taxes are computed by multiplying the taxable value of the property by the number of mills levied. $400,000 farm assessed value > Millage percentage rate of .006, 6 mills > $0.06/$100 in assessed value; or 0.6% > Tax = ($400,000*.006) = $2,400 / yr, or > Tax = ($400,000/1,000) * 6 mills = $2,400
Wake Co. Property Tax Expenditures, 2018 County ($0.6544 per $100) Schools/Oprtg 48% Schools/Capital 20% General Govt 6.6% County Capital 6.0% Sheriff 5.1% Wake Tech 4.5% Human Services 4.4% Community Serv. 1.9% Public Safety 1.6% Housing 1.1% Envtl Services 0.6%
Apex ($0.415 per $100) Public safety 40% Solid waste 15% Cultural & Rec 10% Envtl. Protection 10% Debt Service 8% Economic & Physical Development 8%
Financial Assistance Property Tax Subsidies and Incentives Exemptions and rebates Modified property taxes / current use value > tax at current use > not highest and best > Farm&timber production + wildlife habitat (2008) Timber yield taxes > tax land annually > tax timber only at time of harvest Payments in lieu of taxes > federal payments to counties
Financial Assistance Income Tax Subsidies and Incentives Federal and state income tax breaks > Reduce tax compared to regular marginal rate > Avoid taxes as a incentive Capital gains > Long term investment taxed at reduced rate > Stocks, timber – 15% Equipment > Accelerated depreciation > Investment purposes
Federal Income Tax - Format Filing status (S, M, M/Joint, HH, Widow) Exemptions (dependents, disabilities) Income (wages, business, farm, pensions, etc) - Adjustments (IRA, student loans, tuition, moving, alimony, etc) = Adjusted Gross Income - Itemized deductions (Medical, taxes, interest paid, gifts to charity, casualty, job expenses) = Taxable income x tax rate(s) = Tax - Credits = Net Tax Due
Capital Gains & Income Tax Rates, 1916-2018 100 80 60 40 20 0
1916 1920 1930 1940 1950 1960 1970 1980 1990 2000 2005 2010 2018
Cap Gains 15 15 Income
73 73
12 25
30 78
25 25 32.3 84.4 73.5 73.5 Cap Gains
28 70
33 20 15 20 33 39.6 39.6 39.6
15 37
Income
Source: Hertz Farm Management Presentation, Summer 2007, Des Moines, Iowa Erb 2018; Forbes On-Line
Federal Income Tax Brackets, 2018 Marginal Tax on Income
Single Person Income Tax Bracket
Married Filing Jointly Tax Bracket
10%
$0 - $9,525
$0 - $19,050
12%
$9,526 - $38,700
$19,051 - $77,400
22%
$38,701 - $82,500
$77,401 - $165,000
24%
$82,501 - $157,500
$165,001 - $315,000
32%
$157,501 - $200,000
$615.001 - $400,000
35%
$200,001 – $500,000
$400,001 - $600,000
37%
$500,001 +
$600,001+
Estate tax: 0% for first $11 million per person; $22 million per couple 40% of estate more than that; will increase as indexed in future ~5% max NC income tax; No added estate NC tax, as of 2013
Federal Income Tax Brackets, 2014 Marginal Tax on Income
Single Person Income Tax Bracket
Married Filing Jointly Tax Bracket
10%
$0 - $9,075
$0 - $18,150
15%
$9,076 - $36,900
$18,151 - $73,800
25%
$36,901 - $89,350
$73,801 - $148,850
28%
$89,351 - $186,350
$148,851 - $226,850
33%
$186,351 - $405,100
$226,851 - $405,100
35%
$405,101 – $406,750
$405,101 - $432,200
39.6%
$406,751 +
$457,601+
Estate tax: 0% for first $5.25 million per person; 40% of estate more than $5.25 million per person No added NC tax, as of 2013
North Carolina State Income Tax Brackets, 2013 / 2018 Marginal Tax on Income
Single Person Income Tax Bracket
Married Filing Jointly Tax Bracket
6%
$0 - $12,750
$0 - $21,250
7%
$12,751 - $60,000
$21,251 - $100,000
7.75%
>$60,000
>$100,000
2018:
FLAT TAX
4.99%
Sales Tax Examples Raleigh
6.75%
Durham
7.5%
Rocky Mount
6.75%
Financial Assistance Income Tax Subsidies and Incentives
•
Management cost deductions > Agricultural operations > deduct ag & forestry against (other) income > Must be active investor Reforestation investments > tax deductions, since 2004 > Up to $10,000/yr + 84 mos. if > $10 K Inheritance taxes - reduced or none Conservation easements / deductions > Net value set aside as tax reduction > Started in NC; federal tax adopted later
Conservation Tax Credits and Deductions The Former NC Conservation Tax Credit ➢25% credit against taxes paid for permanent easement ➢Taken directly off tax bill ➢Was eliminated after December 31, 2013 ➢220,000 acres; $1.2 billion donated ❑ Federal Conservation Tax Deduction ➢ Deducted at marginal rate of taxes ➢Taken as percent of tax due at marginal rate ❑
Income Tax Rates Exercise ❑
Calculate 2018 federal and state income tax due for income of $90,000 married filing jointly
❑
Calculate the tax benefit per year that one individual receives from the tax reductions from 2016 to 2018 for a $40,000 income and for a $400,000 income
❑
Calculate the (former) reduced NC state tax credit and the federal tax deduction for a one-time conservation easement deduction of $100,000
Market Based Conservation
Contemporary Policy Interventions Market Development Tradable development rights ❑ Conservation easements ❑ Concessions/extraction quotas ❑ Tradable protection rights payment ❑ Bioprospecting fees ❑ Carbon offset payments ❑ Payments for environmental services ❑ Payments for environmental degradation ❑ Voluntary Environmental Programs ❑ Forest certification ❑ Most can occur on public lands as well ❑
Forest Trends: Ecosystem Marketplace
http://www.forest-trends.org/program.php?id=69
California Conservation and Mitigation Banking
https://www.wildlife.ca.gov/Conservation/Planning/Banking
REDD+: UN Framework Convention on Climate Change
http://redd.unfccc.int/
CARB: California Air Resources Board
http://www.arb.ca.gov/cc/capandtrade/offsets/offsets.htm
World Resources International (WRI): Ecosystem Services Science and Practice
http://www.wri.org/events/2014/12/aces-community-ecosystem-services-linking-science
Westervelt Environmental Consulting: Credit Payments for Ecosystem Services
http://www.wesmitigation.com/
Land Purchase and Management ❑ ❑ ❑ ❑ ❑ ❑
ENGOs – TNC, Conservation International ➢TNC - 40 million ha internationally Land or the development rights Fee simple ownership, permanent or temporary conservation easements State and local governments, and occasionally on the part of the federal government U.S. 2004 3.6 million ha of conservation easements and land trusts U.S. federal cost share/stewardship/partial ownership ➢Wetland Reserve Program, Conservation Reserve Program, and Environmental Quality Incentives Program
Class Case Find an land management ENGO, payment for environmental service, or environmental payment / credit / consulting organizations Describe its main environmental focus market participation
Private Business Regulation / Voluntary Environmental Programs (VEPs) -Theory Must have sufficient rules to achieve goals > Protect environment, correct social problems, improve economic issues > Promote sustainability to public (external) > Improve sustainability within company (internal) Rules and standards > Must be well developed and credible > But not too hard or expensive for organizations > Easy rules, more enrollment; vice versa Process and rules must improve practices, be credible, and affordable Cashore et al. 2007, Vogel 2008
Factors Driving VEPs Public concerns about development, agricuilture, deforestation and illegal logging, social issues Pressure by environmental activist campaigns Increased corporate strategy to support corporate social responsibility (CSR) Expanded business norms and values to consider more stakeholders/communities/objectives Public relations and substance Emerging markets, market share, and prices Professional education and learning Drawn from Vogel 2008
Forest Certification Was First Global VEP Other Now Include Oceans > Marine Stewardship Council > Marine Aquarium Council Social > Social Accountability > Fair Labour Organization Coffee/Cocoa > Fair Trade Coffee > Rainforest Alliance Diamonds
Cashore et al. 2007
Roots of Forest Certification 1992 UNCED Rio Earth Summit > Biodiversity, climate change conventions > But failure to achieve forest convention > Threat to national sovereignty / authority > Developed vs. developing nations split Two eventual responses > Multinational sustainable forest management > Criteria & Indicator processes ~ 1995 > Measure and monitor SFM > Forest Certification – 1993: FSC 1995: SFI > Non-state, market based, private sector/ENGOs Humphreys 2007 > Standards and prescriptions
Non-State Market Driven (NSMD) Approach Cooperation among > leading global environmental groups > social allies > Selected companies and retailers > World Bank > Large foundations e.g. Forest Stewardship Council (FSC) -1993 Monitor companies for environmental and social practices, audit specific standards Move away from government control to NSMD Often termed “soft law” Cashore et al. 2007
Beyond NSMDs: Government Co-Regulation and Corporate Social Responsibility (CSR) Government watches CSR; lets market dictate Govt cooperates – technical information assistance Govt enables – provide incentives Govt endorses – administrative policies, e.g. public procurement Govt certifies – public forest land Govt mandates or blocks – CSR required by legislature, or blocked from implementation
Corporate Social Responsibility Evolving sustainable development principles > Social and environmental > Forest certification a subset for companies > But certification is for public lands as well Economic Perspectives of CSR > Tradeoffs: loss of private business profits > Corp strategy: PR, markets, sales, labor relations > Social impact: community, labor retention, capital Modest evidence that CSR improves performance of large forestry firms Toppinen et al. 2012
External Corporate Sustainability Ratings ❑ New tools for tracking corporate social
responsibility ➢ Dow Jones Sustainability Index ➢ Newsweek ➢ Walmart ➢ And many more
❑Important to certain institutional investors, and increasingly more so ❑ Transparency ❑ Demand continues even in recession
Business-Green Building Exclusive Green Building Rating Tools > USGBC – US Green Building Council > Leadership in Energy and Environmental Design (LEED) Recognizes FSC, not SFI > Local residential building standards (BuiltGreen Washington, Green Star, etc.)
Inclusive Green Building Rating Tools > NAHB - National Association of Home Builders > GBI - Green Building Initiative (US and Canada) > UK Building Research Establishment Environmental Assessment Method (BREEAM)
Business-Printing Our Green Guarantee: Your job is printed chemistry free, in an FSC/SFI certified facility using soy inks on sustainable papers. www.printingresponsibly.com/
Sustainability Performance: reported externally and audit reports available online
43
Conclusions ❑ ❑
❑
❑
Governments actively involved in land ownership, management, incentives, or regulation Government owns much of the world ➢ 35% of USA ➢ 28% federal, 7% state and local ➢ 84% of forests in the world Tempered by very limited government budgets and intense competition for funds for forestry and natural resources with short-run problems that are perceived to be more pressing – health, sanitation, poverty, terrorism Thus market based & mixed programs increasing
Conclusions ❑ ❑ ❑
❑ ❑
Government remains crucial Sets the policy rules and mandates for market exchanges to work in conservation As it always has in production & commerce ➢ Kyoto Protocol for climate change ➢ U.S. no net loss policy for wetlands protection VEPs use government laws as required baseline Host of new policy instruments / partial ownership of bundle of rights / payments for environmental services ➢ Ag land policies ➢ More parks, local lands, etc. ➢ Carbon payments, environmental services
Farm, Wildlife, and Forestry Incentive Programs 2015
Federal Financial Assistance: Conservation Payments and Grants List of Federal programs overlap with Indicator 6.27: Payments for ecosystem services Programs designed to address forest products: • FLP • HFRP • LPI • LSF • SPBP
Table 3. Federal Programs Providing Financial and Technical Assistance to Interests in Forests and Related Resources Source: CFDA, 2014
State Financial Assistance: Conservation and Production Programs State Programs Alabama Agricultural & Conservation Development Commission Program California Forest Improvement Program Delaware
Forestry Cost-Share Program Florida Longleaf Pine Private Landowner Incentive Program Rural & Family Lands Protection Program Illinois Forestry Development Act Program Maryland Woodland Incentive Program Mississippi Forest Resource Development Program Missouri Soil & Water Conservation Program
Program Type
North Carolina
FY 2014
Funding Source/s Forest Development Program Oklahoma
Cost-Share
$1,746,053
Forest Product Assessments
Forest Resource Development Program South Carolina
Cost-Share
$22,720
Oklahoma Forestry Cost-Share Fund
Forest Renewal Program Virginia
Cost-Share
$815,838
Roundwood Tax, State Appropriations
Cost-Share
$0
Alabama Ag & Cons. Development Comm.
Cost-Share
No Info
Greenhouse Gas Reduction Fund
Pine Bark Beetle Prevention Program
Cost-Share
$200,000 2
Virginia Department of Forestry
Cost-Share
$3,257
Delaware Forest Service, Cropland Leases, Timber Sales Revenues
Reforestation of Timberlands Wisconsin
Cost-Share
$1,600,000 2
Commonwealth of Virginia's General Fund
Grant/Loan
No Info
Weed Management Area Private Forest Grant Program Wisconsin
Cost-Share
$0 FY 2013
WDNR Forest Grant Program
Easement
No Info
National Fish and Wildlife Foundation Florida Forest Service, Private Silviculture Operation
Grant/Loan
$711,634
Wisconsin Forestry Fund
Cost-Share
$75,413
Illinois Forestry Development Fund
Cost-Share
$1,800,000 FY 2012
Severance Tax
Cost-Share
$100,000
Woodlands Incentive Fund
Resource Enhancement & Protection Program
Cost-Share
$1,200,000
Oregon
Cost-Share
$2,000,000
Miss. Forestry Comm., Timber Severence Tax
Cost-Share
$1,258
MDNR, Park, Soils & Water Sales Tax
County Forest Acreage Share Payments Louisiana Forest Productivity Program Iowa
Forest Resource Trust
Iowa Environment First Fund, NR License Plate Sales
Collective Funding
Grant/Loan
$1,500,000
Forest Resource Trust (initial deposit by Klamath Cogeneration Project)
State Financial Assistance by Region Number of States in Region with Financial Assistance for Forest Market Practices
Financial Assistance
HI, AK & Pacific Coast 2
Rocky Mountain
North
South
0
6
7
Pacific Coast: Washington, Oregon, California; Rocky Mountain: Idaho, Nebraska, Arizona, Utah, Montana, Wyoming, Colorado, New Mexico, Kansas, Nevada, South Dakota, North Dakota; North: Minnesota, Iowa, Missouri, Wisconsin, Illinois, Indiana, Michigan, Ohio, West Virginia, Pennsylvania, Maryland, D.C., Delaware, New Jersey, New York, Rhode Island, Connecticut, Massachusetts, Vermont, Maine, New Hampshire; South: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia
Contracts vs. Easements Contract – Two parties > Fixed term agreement between landowner and government agency > May pass with land or with operator > % to perform practice + annual payment
Easement – In DEED > Taking away one of development “sticks” > Permanent reduction in more developed use forever – or very long term ~ 50 yr > Recorded as part of your deed
Purpose Voluntary conservation program that provides technical and financial assistance to farmers to address natural resource concerns on their lands. Contracts are developed to solve resource concerns. Payments are made after conservation practices are installed to NRCS technical standards.
Eligibility Persons engaged in livestock, or agricultural production and owners of Non-industrial private forestland are eligible. To apply: Must be a producer Be in compliance with HEL/WC Develop a conservation plan of operations(agreed to schedule)
Some basics… If animal waste storage or treatment is included, a comprehensive nutrient management plan must be implemented. If forestry is included, a forest management plan prepared by a forestry professional is required. Organic – applicant must be either Certified or in Transition and working towards Certification.
Sign up for the program is continuous. We set a batching period each Fiscal Year. At that point, we rank all applications and fund the highest ranking ones. Ranking Pools include: Confined Animals Socially Disadvantaged New and Beginning Pasture(grazing) Cropland Forestry Ag Chemical Handling Facility Lagoon closures Organic Initiative Seasonal High Tunnel
A payment schedule is prepared for each Fiscal Year. Cost share rates are approximately 75% New and Beginning, limited resource producers and Socially Disadvantaged receive 90% There is a $300,000 payment limit during the 6 year life of the Farm Bill. NC’s allocation is approximately $14 million annually….
Purpose Voluntary program to develop or improve high quality habitats that support fish and wildlife populations of national, state and local (and tribal) significance. NRCS provides technical and financial assistance to private landowners for the development or upland, wetland, aquatic and other types of wildlife habitat.
Land eligibility Private ag lands including cropland, grass and pasture land, non-industrial private forest land, tribal lands, other lands determined suitable for fish and wildlife habitat development.
Some changes with the 2008 Farm Bill version of WHIP… Public Lands not eligible Payment limit per person per year is $50,000 North Carolina uses a Habitat Priority process. Proposals are solicited to focus funds on targeted areas rather than a “shotgun” approach.
To be basically eligible for the Initiative: Longleaf pine must be either currently present or capable of being established on the contracted acres within the life of the contract. Mixed stands of longleaf and other tree species are eligible if the intent of the application is to promote the enhancement of the existing longleaf pine or the regeneration of longleaf pine in the next rotation.
Core Conservation Practices 666 (ac) Forest Stand Improvement 338 (ac) Prescribed Burning 612 (ac) Tree Shrub Establishment Facilitating Practices 394 (ft) Firebreak 490 (ac) Tree/Shrub Site Preparation 647 (ac) Early Successional Habitat Development/Mgt. 383 (ac) Fuel Break
Purpose Voluntary program that encourages agricultural and forestry producers to address resource concerns by: (1) undertaking additional conservation activities and (2) improving and maintaining existing conservation systems.
CSP is available to all producers, regardless of operation size or crops produced, in all 50 States. Eligible lands include cropland, grassland, pastureland, nonindustrial private forest land, and agricultural land under jurisdiction of an Indian Tribe.
Applicants may include individuals, legal entities, joint operations, or Indian tribes. 1) Be the operator of record 2) Have effective control of the land for the term of the proposed contract; 3) Be in compliance with HEL/WC; AGI 4) Include the eligible land in their entire agricultural or forestry operation.
CSP pays participants for conservation performance—the higher the performance, the higher the payment. It provides two possible types of payments.
Types of payments An annual payment is available for installing new conservation activities and maintaining existing practices. A supplemental payment is available to participants who also adopt a resource conserving crop rotation.
CSP addresses seven resource concerns Soil Quality Plant Resources, Soil Erosion Animal Resources Water Quality Water Quantity Air Quality Plus…. ENERGY
Market-Based Conservation – Economic Subcommittee Natalie Woolard, NC DENR
Agricultural Cost Share Program (ACSP) Conservation Reserve Enhancement Program (CREP) Community Conservation Assistance Program (CCAP) Impaired and Impacted Stream Initiative Lagoon Conversion Program Methane Capture Program
A voluntary program to protect water quality by installing best management practices on agricultural lands. This approach is supported by financial incentives, technical and educational assistance, research, and regulatory programs provided to farmers by local soil and water conservation districts
Payments of 75% of the average costs directly associated with the installation of a BMP.
Examples include: Water Control Structures Livestock Exclusion Riparian Buffers
A
predetermined fixed payment paid to an applicant for implementing a BMP in lieu of full 75% cost share.
Examples: •Long term No-till
•Nutrient Management •Sod Based Rotation
Percent Age of Practice Refund 0 10 20 30 40 50 60 70 80 90 100
Life Percent
89 74
55 17 0
100 95 82 65 44 31
When
land under cost share agreement changes owners the new landowner shall be strongly encouraged by the district to continue and maintain practice(s) previously implemented.
Contract
goes with the landowner/operator not the land.
CREP is a voluntary program utilizing federal and state resources to achieve long-term protection of environmentally sensitive cropland and marginal pastureland.
$274M
federal/state partnership agreement USDA has committed $221M to payments to NC landowners (80%) State of North Carolina has committed $53M as 20% required match from: NC Agricultural Cost Share Program ◼ Clean Water Management Trust Fund ◼ Appropriated Division personnel and operating funds ◼
CP3 Tree Planting (shortleaf Pine only) CP3A Hardwood Tree Planting (includes Longleaf Pine, Atlantic White Cedar and Bald Cypress) CP21 Filter Strip CP22 Riparian Buffer CP23 and CP23A Wetland Restoration CP31 Bottomland Timber Establishment
Federal Financial Incentives • Farmers enroll in 10 to 15-year contracts with USDA – Farm Service Agency • Farmers receive annual federal incentive payments based on USDA-set soil rental rates • USDA Natural Resources Conservation Service prescribes applicable conservation practice(s) • Farmers receive federal cost share (50 %) to install conservation practice(s)
State Financial Incentives • State offers two conservation easement options to extend duration of protection 30-year
$250 per acre
Permanent
$1000 per acre
• Enrollments 10 acres or more must enroll in the state enhancement • State makes a one-time incentive payment • State makes cost share payment (25-50%) to supplement federal cost share payment
5
acres – Permanent Conservation Easement CP22 Riparian Buffer Practice
State Cost Share Funds $14,104
Landowner receives $18,700 more when funds are combined.
Combining Funds (Federal and State) ▪ FSA
$9,402 ▪ ACSP $9,402 ▪ Soil Rental Payments $9,000 ▪ Easement Payment $5,000 Total
$32,804
Conservation Easements Payments and Taxes Property rights > bundle of sticks to acquire, use, dispose of land > Exclusive, but not absolute
Conservation Easements > Purchase part of development rights > Protect from use forever
Or “Transfer of Development Rights” (TDRs) ~ 9 million ac conservation easements, 2004 Receive payments and/or state and federal income tax deduction as a gift for value foregone
⚫
Established in the 1990 Farm Bill - Sec 2103c.
⚫
Federal-State Partnership - State develops own guidelines
⚫
Feds set national guidelines and provide the funding
⚫
75 % cost share limit Source: NC Forest Service 2013
Prepared by a lawyer Recorded at county courthouse Perpetual Shared Ownership Reserve Interest Deed Option
CONSERVATION EASEMENT CONTENTS
General Purpose Statement Affirmative Rights Restrictions Reserved Rights Terms & Conditions
The purpose of this easement is to effect the Forest Legacy Program in accordance with the provisions of Section 1217 of the Food, Agriculture, Conservation and Trade Act of 1990 (16 U.S.C. 2103c) as amended, on the herein described land…
Title can be held by land trust Appraisal is between landowner and IRS Purpose clauses acceptable to IRS Outdoor recreation Habitat Open space or scenic enjoyment Historic
Amicable agreement Purpose clause meets Forest Legacy objectives Appraisal & Appraisal Review Legal survey, Title Forest Stewardship Plan Publicity
Clauses match the stated purpose Allows landowner use to meet his/her forest stewardship goals Intention unmistakable Defines all rights and restrictions
Landowners uses State forest management goals
rth Carolina Forest Legacy Tracts
Fiscal Year North Carolina Forest Legacy Projects
2000
Working Forest Acres Conserved
Forest Legacy Funding
2001
Town Creek Phase I: Davis Farm in Brunswick County Town Creek Phase II: Boise & Duckhead in Brunswick County
328
2002
Blue Ridge Parkway Buffer: TCF in Haywood County Blue Ridge Parkway Buffer: Roy Taylor in Jackson County
864
$1,500,000
2003
RPM in Carteret County
841
$1,490,000
2004
Cool Springs in Craven County
1,670
$1,481,209
2007
Whitehurst Forest in Craven County
181
$1,000,000
2008
Clarendon Plantation in Brunswick County
327
$1,485,000
2009
Alliene LLC (Fred Taylor) (Donation)
812
$0.00
7,835
$11,050,269
TOTAL
1,082
$1,400,000
1,508
$2,694,060
94
NORTH CAROLINA MARKET BASED CONSERVATION INITIATIVE • Innovative new military/conservation program in NC • To prevent encroachment from developed uses • Designed to protect military training route (MTR) for flight path based at Camp Lejuene • And contribute to rural land conservation • Though long term contracts to keep rural lands in farm, forest, or wildlife status • Payments from DoD/Navy/Marines • Targeted at lands under flight path • With qualifying agricultural status
PROJECT IN BRIEF ▪
Military Training Route is 2 miles wide and overlays an estimated 400,000 acres in 18 eastern counties
▪
Provides yearly payments for landowners to maintain land in agriculture and forest production
▪
Program uses contracts instead of conservation easements
▪
Reverse auction process whereby landowners compete for participation in program by placing bids (i.e. market based)
▪
$~6 million allocated as of October 2012 First round of submissions for Phase 1 by Spring 2013
MBCI PROGRAM REQUIREMENTS • Land must be located under the military flight path • Land must be in agricultural, wildlife, or forestry working lands or other open space land uses • Land should be enrolled in a deferred tax program for agriculture, wildlife, forestry, or other open space land use • Landowner must have or obtain an active management plan for conservation, agriculture, wildlife, forestry, or other open space land use • Landowners must agree to keep the land enrolled in compatible uses, build no tall structures over 100 feet without permission, and refrain from upward shining light projections • Landowners will offer bids they are willing to accept to limit development on their land
PROGRAM DELIVERY SYSTEM •
PRIMARY ▪ NC Foundation for Soil and Water Conservation ▪ NC Association of Soil and Water Conservation Districts ▪ 16 Local Soil and Water Conservation Districts
•
OTHER PARNTERS NC State Cooperative Extension NC Department of Agriculture and Consumer Services Environmental Defense Fund NC Farm Bureau NC Department of Environment and Natural Resources NC Forestry Association Natural Resource Conservation Service NC Grange Local Voluntary Agriculture District Boards
• • • • • • • • •
Choose one property from the reverse side. Then choose one state and one federal program listed below and estimate how many acres you would enroll in the program, “stacking” those programs. Estimate the revenue you would receive for enrolling in the program based on cost-share payments.
Financial Assistance funds eligible agricultural producers, landowners, historically underserved, and Tribes to address various conservation issues such as: Practices to control erosion and improve water quality (Agricutural Management Assistance - AMA) Install new or help maintain existing conservation activities and systems (Conservation Stewardship Program - CSP) Implement conservation practices to address natural resource concerns (Environmental Quality Incentives Program - EQIP) Improve land and water habitat for wildlife species (Wildlife Habitat Incentive Program WHIP)
Natural Resources Private Land Policy Tools Lecture Presented in Natural Resource Policy and Management
NC State University, Raleigh, NC November 2015
NR460_Lecture9_Private_Tools_V18
