Page 7 - Georgia Forestry - Issue 1 - Winter 2024

Cultivating Fairness
Timber is the only commodity in the state that is taxed at harvest. Georgia tree farmers highlight the need for equity.
POLICY
The impact of this policy is profound, put- ting tremendous financial stress on private landowners across the state, considering that they are still obligated to pay annual ad valorem taxes on their land as well as state and federal tax on the income from each timber sale. Entering the 2023 legislative session, the Georgia Forestry Association looks to bring more fairness and equality to the taxation of harvested trees on behalf of the hardworking, dedicated people who steward our state’s forests.
House Resolution 96, sponsored by Rep. Noel Williams (R-Cordele), was introduced during the 2023 Session of the Georgia General Assembly and passed by the House of Representatives. This year, the Senate will pick up debate on the legis- lation, which is aimed at reducing the tax assessment rate from 100% of fair market value to 40% of fair market value. The change will support tree farmers across the state by reducing their ad valorem tax burden and encouraging investment in reforestation and long-term management of the land.
JOHN CASEY
By John Casey
Over the past several decades, the State of Georgia has maintained a steadfast commitment to sound legislative policies, particularly in the area of fiscal responsi- bility. Given Georgia’s status as the nation’s top state for both business and forestry, legislators and state executive leadership have worked diligently to reduce the gov- ernment’s fiscal burden on local industries and landowners — but in the realm of for- estry, there remain significant challenges
Richard Curtis
Greene County
that the Georgia Forestry Association is working to overcome.
Most strikingly, timber faces a distinc- tive challenge as the only agricultural or mining commodity subject to a harvest tax in the state. In addition, the burden of that harvest tax is assessed at 100% of the fair market value of the harvested timber, a stark contrast to the 40% assessment applied to other real properties such as homes, buildings and land.
Pinned between three rapidly developing counties, Richard Curtis is concerned about the future of his family farm. The growth of Athens to the north, Madison to the west, and Oconee to the south has sent their tax assessments skyrocketing, with some of the tracts increasing in value by three times in just a decade. He’s grateful for the tax reprieve he receives through the state’s Qualified Timberland Program (QTP), but it’s not enough to offset additional tax burdens, particularly the state harvest tax. As he looks at the numbers, he fears that soon his only option will be to sell, likely to developers who will parcel out and build on the property.
“It’s totally unfair that we are the only ones whose property is assessed at 100% of value. That money could pay for a good portion of replanting the land,” said Curtis. “We’re at the point where the valuation on the land is so much that we can’t grow timber on it and justify it. At some point in time, we’re going to have to sell it because there just isn’t enough income coming off of it from the sale of timber and recreation.”
According to data from the U.S. Forest Service, Georgia loses 118,000 acres of forestland annually due to urban sprawl. As he begins to plan future harvests, Curtis is now factoring in whether or not he will replant, weighing the burden of the harvest tax and additional management costs.
“Without QTP, we couldn’t afford to pay the tax and live on it as income too. Now we’re at a point where even with it, it’s hard to make sense of holding onto the land after harvest because of the tax we take on when we do,” said Curtis. “I’m not sure for how long, but if they fix it, we can at least hold on to it for a while longer.”
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