New York 480-a or USDA EQIP experience?

Jason_AliceMae Farms · September 12, 2013, 12:42:29 PM

As I mentioned in my introduction I am doing some planting of a few acres so that I will be able to qualify some of my acreage for the New York State 480-a tax plan to help save on the high taxes up here as well as to gain some knowledge from the local forester that I plan on working with. Do any of my fellow NY members have any experience with the 480-a program? http://www.dec.ny.gov/regulations/2422.html

Along the same lines do any members have any experience with the USDA EQIP program? http://www.nrcs.usda.gov/wps/portal/nrcs/main/national/programs/financial/eqip/ Once I am set up in NY with the 480-a I will be able to start applying for some of the grants available through the EQIP program.

I just wanted to see if any members out there had any experience with either of these programs or if you had any thoughts or opinions. I doubt these are new programs to some of you guys but they look to be beneficial to help with some of the taxes and some of the forest management costs associated with a timber stand.

Jason

moosehunter · September 12, 2013, 02:02:10 PM

I did a small amount of research a few years back about NY State programs, don't remember the names or numbers. What I found is that the state is going to get their money sooner or later. If you enter some of these programs today you can get tied up in them for years (10-15 if I remember correctly) and if you ever sell timber off your land you pay a large extra tax because you have not paid your fair share of property tax over the years. AND you have a state bureaucrat looking over your shoulder.
A fellow I know locally that is involved and he really likes it. Right now the state is paying him to build trails on his property.
Just be careful any time you deal with NYS.

Jason_AliceMae Farms · September 12, 2013, 02:40:39 PM

Yeah, I am not a fan of NYS for those reasons but I love the area I am in. The 480-a program does tie up the land for 10 years and that is the time you will save on the property taxes. A lien is placed on the land during that period from what I understand which I am really not a fan of. There is also a 6% stumpage tax paid to the county/town at the time of a timber sale and you have to follow a prepared management plan approved buy the local DEC forester.........do you think it would be smarter to just work with a forester to get a management plan done but not tie up the land in the program with a lien, stumpage tax, etc.?

It sounds like the guy you mentioned may have gotten some money from the EQIP program. they have a scoring system/application and fund projects like trail maintenance and thinning. From what I understand they really like to fund larger $$ projects with lots of land and work instead of giving out a lot of smaller awards.

I am always cautious with anything and everything in NYS. It is so sad how the politics has really devastated such a beautiful state.

Furu · September 12, 2013, 03:21:16 PM

I have previously applied for, been granted and have completed an EQIP application and contract. Last year I applied again and they ran out of money before they made it to my ranking level.

Well worth the effort but you are in bed with the Federal USDA NRCS for the duration and that has its pros and cons. I would and have done it again.

Obviously I can not comment on the advisability of getting in bed with NY state as I have no experience with them.

Raider Bill · September 12, 2013, 04:13:11 PM

Quote from: Jason_AliceMaeFarms on September 12, 2013, 02:40:39 PM
Yeah, I am not a fan of NYS for those reasons but I love the area I am in. The 480-a program does tie up the land for 10 years and that is the time you will save on the property taxes. A lien is placed on the land during that period from what I understand which I am really not a fan of. There is also a 6% stumpage tax paid to the county/town at the time of a timber sale and you have to follow a prepared management plan approved buy the local DEC forester.........do you think it would be smarter to just work with a forester to get a management plan done but not tie up the land in the program with a lien, stumpage tax, etc.?

It sounds like the guy you mentioned may have gotten some money from the EQIP program. they have a scoring system/application and fund projects like trail maintenance and thinning. From what I understand they really like to fund larger $$ projects with lots of land and work instead of giving out a lot of smaller awards.

I am always cautious with anything and everything in NYS. It is so sad how the politics has really devastated such a beautiful state.

You mean it's not all skyscapers and yellow cabs! :D :D :P

jwilly3879 · September 12, 2013, 05:02:28 PM

You must have at least 50 acres, an approved management plan and you can receive an exemption of up to 80% of your assessed value. For example - 50 acres @ 400/acres = 20,000 x 80% = 16,000 exemption. So you would pay taxes based on 4,000 but your property is tied up and you must harvest according to your plan or pay penalties. At the time of a harvest you would pay 6% of the stumpage value.

Here's a link on the side opposing 480-A

http://www.forestrylaw.com/articles/rptl_section480a.html

Another link

http://www.tax.ny.gov/pdf/publications/orpts/forest_taxation_program_480a.pdf

It is some interesting reading.

Here in our Town some smart landowners placed there land into the old 480 program to avoid taxes but are now being looked into for failure to harvest. One particular parcel is 52 acres of lakefront assessed at $480,000 and they have been paying taxes on only $80,000 for the past 38 years and someone pointed it out to the assessors.

treefarm · September 13, 2013, 06:35:32 AM

I have no experience with NY forestry programs & laws, other than through a real estate agent friend over there. I would be very wary of any government entity placing a lien on my land for 10 minutes, much less ten years, and more importantly, suddenly having a state bureaucrat with taxing authority as a boss. In NH, we have a program called current use, which is a huge tax break that only gets taxed if some or all of the land is taken out of the program. Even if you sell the land and it remains in CU during the transfer to the buyer, there's no tax. It was designed to keep open space, woodlands etc. preserved, and fortunately, the state never looked at it as a revenue source, so it's been kept simple and user friendly. NY and Mass. never seem to operate that way
:>(

moosehunter · September 13, 2013, 08:58:52 AM

Another story,.....
Chuck, a friend and neighbor of mine owns 200+ acres, mostly wooded, some old growth with 5'+ dbh Red Oaks. Very beautiful forest.
Tired of paying the outrageous taxes he started looking into options. The first he looked at was the 480-a. The biggest drawback for him was the harvest plan. He wants his forest to never be harvested.
Here is where you KNOW that NYS is going to get their taxes. He can not be in that program if he does not harvest.
Looking for other ideas he talked with the local Land Trust organization. Even they had a "harvest plan"!!!! He talked with them for a long time and they finally agreed to make it a sanctuary and never harvest it. So he is in the process of donating almost all of it to the Land Trust. He will have life time use of it and the land trust will pay him to mow the open areas and keep foot trails open. NYS gets nothing, the Land Trust is a tax free organization.
So instead of having reasonable property tax rates they lose large chunks, which just raises my (and everyone else's) taxes.

Was that a rant? Sorry I try real hard not to do that on the FF.

beenthere · September 13, 2013, 10:49:54 AM

"Never" harvesting is a disaster for a forest. IMO.
A woods that is not managed will in time become too dangerous with old trees to safely use the walking paths.

Had a similar experience in our township when 600+ acres were removed from the tax rolls because the taxes (assessment based on all potential development) were very high. Now the land is in conservancy and big Gov't grants being spent to convert it all back to oak savanah. So we lose both ways (receiving no property tax and spending fed. tax dollars) but gain in conserved land with no development.

moosehunter · September 13, 2013, 04:00:58 PM

Beenthere,
I agree with no harvest is not good, but it is his land and his wishes so I respect it. We have had discussions about healthy Forests and harvesting, but he is pretty set in his desire.

coxy · September 19, 2013, 07:14:18 AM

I have a friend that is or was in the 480 a he had a 15 year plain got out at 9years now he cant cut any wood for 9 more years or he has to pay all the tax money back what a bunch of he only got out because he needed money but in the long run made it worse and they wont let him back in until the 9 years are up if they would have told him all this be fore he would have never got him self in the mess to start with read ALL the fine print over and over his 15 year plain is now 18 years with full tax

Jason_AliceMae Farms · September 20, 2013, 07:56:24 AM

Thanks for all the input, I am leaning towards not enrolling into the 480-a program and just having the management plan put together so I have a good roadmap to work with. I don't like the idea of a lean being placed on my land and NYS politics has been harmful to the state in my opinion so I think it is best that I don't tie myself to all of the red tape.

A week from today I will be starting my planting. I am looking forward to it and plan on tracking the progress with medicine bottles on a few of the seedlings (I am stealing that from another thread on here).