FORESTRY ASSISTANCE IN MICHIGAN

FINANCIAL ASSISTANCE

	2008 Farm Bill
	Forest Incentives Program
	Conservation Reserve Program
	Watershed Protection Program
	WHIP & WRP
	Forest Stewardship Program
	Tax Laws

The Farm Service Agency administers the following federal cost-share programs.  Contact your local FSA office or locate Conservation District office to sign up for a particular program.  For more information, contact the FSA or Conservation District in your area, or the nearest DNR Private Forest Management forester or the Natural Resources Conservation Service.

The 2008 Farm Bill

This bill provides a source of funding to assist private landowners with management costs.  In Michigan, these funds are distributed through Natural Resource Conservation Service and the Farm Services Agency. Unfortunately, the U.S. Congress has not followed through with consistent funding for this program.

The Conservation Reserve Program (CRP) provides landowners up to 50 percent cost sharing to establish erosion control practices to improve water quality and convert highly erodible cropland to permanent cover over a 10 year (15 year for hardwood tree planting) contract period. An annual rental payment is made to participants during the contract period. The CRP is administered by the Farm Service Agency (tree planting practices only) and by the USDA-NRCS for all other cost-shared practices. Both hardwood and softwood tree plantings are eligible for cost-share under the CRP at the 50 percent rate. The landowner is required to develop and follow a basic conservation plan to carry out the planned practice installation. Eligibility requirements for the CRP tree planting practices are specific to meet the program objectives of erosion control and water quality improvement. Funding for the CRP has remained fairly steady in Michigan with nearly 2,100 acres of tree planting applications (hardwood and softwoods) accepted in 1997 and 1,200 acres accepted in 1998.

Wildlife Habitat Incentive Program (WHIP)

The Wildlife Habitat Incentive Program (WHIP) was authorized by the 1996 Farm Bill and provides 50 percent cost-sharing in Michigan for approved wildlife habitat conservation practices. Participants in the WHIP prepare a wildlife habitat development plan with the NRCS and the local Conservation District. The participant then enters into a multi-year agreement with the USDA for a minimum of 5 years and a maximum of 10 years to carry out the wildlife development plan. Practices eligible for cost-share include: grassland establishment; wildlife corridors of tree and/or shrub plantings; streambank stabilization and fish cover structures; and establishment of habitat for threatened and endangered species. While the primary objective of the WHIP is to promote wildlife habitat, secondary benefits of water quality improvement and soil erosion and sedimentation accrue from tree, grass and shrub establishment under this program.

The Wetland Reserve Program (WRP) is administered by the USDA Natural Resources Conservation Service (NRCS) with primary objectives to restore and protect wetlands and their associated values. Secondary benefits include water quality and flood protection, erosion and sediment control and aquifer recharge. The program in Michigan offers three easement options to participants: (1) Permanent easements. NRCS pays 100% of restoration costs; (2) 30 year easements. NRCS pays 75% of what would be paid on a perpetual easement and 75% of restoration costs; and (3) Restoration easements. Minimum of 10 years and restoration cost-shared at a 75% rate. In all cases the landowner controls access to the land.

Timber and other crops such as hay or grazing may be permitted if they do not negatively impact the restoration of other values being protected. NRCS is responsible for the management of 30 year and perpetual easements. To be eligible a landowner must have owned the land for 12 months (unless it was inherited) and the land must be restorable for wildlife benefits.

There are five categories of eligible land: 1) Agricultural land with restorable wetlands; 2) Land adjacent to wetlands - these cannot exceed 50% of the total easement and must include uplands and non-cropped natural wetlands; 3) Wetlands restored under federal or state programs - this land is only eligible if it has fewer than 30 years remaining on its easement; 4) Conservation Reserve Land - only eligible if the land is likely to return to production after the CRP contract expires and the land was not established to trees or alley cropping; and 5) Riparian Areas – areas along waterways that link two or more protected wetlands are eligible if the area averages less than 300 feet wide on each side of the waterway and is less than 1 mile long. Waivers for additional widths and lengths may be granted.

The Forest Stewardship Program encourages the active management of forest resources owned by non-industrial private landowners.   The purpose of the program is to help landowners increase the benefits they derive from their land while conserving it for the future.  This plan serves as a "road map" for landowners by documenting landowner objectives for the land and recommending sound management practices needed to accomplish these objectives.  The FSP assists landowners in having a Forest Stewardship Management Plan written by a professional forester or wildlife biologist.  The FSP may reimburse up to 50% of the cost of a written plan if funds are available.  The program is administered and coordinated by the MDNR Forest, Minerals, and Fir Management Division.

A comprehensive manual titled Timber Tax Management for Tree Farmers (FNR-80) is available from the American Tree Farm organization. Written by professor Bill Hoover, it is 130 pages of easy to understand explanations, examples and worksheets of federal tax applications. Call (202) 463-2462 or write The American Tree Farm System, 111 19^th St. N.W., Washington D.C. 20036. 1998 cost was $24.95.  A great on-line resource can be found at www.timbertax.org. MSU Extension also has a publication entitled "Minimizing Federal Income Tax for Forest Landowners".

Michigan has three acts pertaining to ownership taxes and forest land & open space. In general, all three acts have the objective of preserving forests and open space so that the land is not developed for housing, commercial, or industrial use.

1) The Commercial Forest Program (CFP)

The Commercial Forest Program is an incentive to private landowners to retain and manage their forestland for long-term timber production by property tax relief. Listed forestlands do not pay ad valorem property taxes, instead a specific tax of $1.25/acre is paid annually, with increases every five years. . Enrolled lands must be a minimum of 40 acres and are required to be open to public hunting and fishing without permission of the owner (foot access only). Public access for any reason other than hunting and fishing is NOT provided by this program.  Most of the lands enrolled under this program is owned by forest industry. The Commercial Forest Program is administered by the MDNR.

2)  Qualified Forest Property Program

New in 2006, this program exempts forest parcels from school operating taxes (18 mils) in many taxing districts. The QFP has a number of eligibility requirements, including a forest management plant with timber management considerations. Unlike the Commercial Forest Program, the QFP does not require a forest owner to allow public access for hunting, fishing, and trapping. The Commercial Forest Program is administered by the MDNR, Department of Treasury, and local tax assessors.

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This website is maintained by Bill Cook, Michigan State University Extension Forest in the Upper Peninsula.  Comments, questions, and suggestions are gratefully accepted. 

Last update of this page was 29 March, 2011

This site is hosted by School of Forest Resources and Environmental Science at Michigan Technological University.