forest recovery act...forest recovery act (h.r.1444) will help america’s forest landowners recover...
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April22,2019
TheHonorableRichardNealChairmanHouseWaysandMeansCommittee 1102LongworthHouseOfficeBuildingWashingtonD.C.20515
TheHonorableKevinBradyRankingMemberHouseWaysandMeansCommittee1139LongworthHouseOfficeBuildingWashington,D.C.20515
DearChairmanNealandRankingMemberBrady,
TheundersignedorganizationssupporttheForestRecoveryActof2019andurgetheHouseCommitteeonWaysandMeanstoimmediatelyscheduleahearingonthelegislation.TheForestRecoveryAct(H.R.1444)willhelpAmerica’sforestlandownersrecover from the loss of their forests afternaturaldisasters.TheHousepassedemergency disaster packageprovidesmuchneededreliefforagriculture crops and farmers butdoesnot provide economic relief for forestlandownerswhose timber crops were devastated.TheForestRecoveryActisnotasubsidyortransferoffundsprogram.Itsimplyallowslandownerstodeductthefairmarketvalueoftimberdestroyed bynaturaldisasters.
Undercurrenttaxlaw,landownersareonlyallowedtodeductthelesseramountofthefairmarketvalue,thecostbasis,ortheadjustedtimberbasis.Unfortunately,thedeductionamounttypicallyequalszero afterthe7-yearamortizationperiodoronlyafractionofthefairmarketvalueofthedestroyedtimber.Thisisproblematicforforestlandownersbecauseinmostcasestheirtimberbecomesmarketable25to40-yearsafterbeingplanted.Forestlandownersmustpayexpenses,includingtaxesannually,withoutcropincomeduringthisentiregrowthcycle.Forestlandownersdifferfromothercropproducersbecausetheyarenotprovidedfundstocoverthefairmarketvalueoftheirlostcropthroughdisasterrelieffundingandinsurancefortimberlandisprohibitivelycostlyintherarecasesitisavailableatall.The Forest Recovery Act would amend the tax code to allow forest owners to deduct the full market value of their timber prior to the loss caused by the federally declared natural disaster.
America’sforestlandisvitaltotheenvironmentandcommunities,accountingfor30percentoffilteredfreshwatersupply,providinghabitatfor60percentofat-riskspecies,andcapturingenoughcarbontooffset10-15percentofU.S.industrialcarbonemissionsannually.Withouteconomic assurancesafteranaturaldisaster,thepublicandenvironmentalbenefitsprovided by forests will begintodeclineasnaturaldisasterscontinuetoaffecttheUnitedStates.This common-sense policy would provide forest owners the security of knowing their 25 to 40-year investment in growing healthy forests will not be a complete economic loss if a natural disaster strikes; incentivizing keeping land in forest use for environmental benefits for both rural and urban communities.
Amendingthetaxcodetogive landownersimmediate relief and remain economically viablewillhavebothenvironmentalandeconomicbenefitsforall Americans.TheundersignedsupportthepassageofH.R.1444,theForestRecoveryAct,whichprovidesthenecessaryincentivestokeep forestland as forests afteracatastrophicdisasteroccurs.Thislegislationwillnotonlysupportfamiliesinthetimberlandandforestindustrybutcontributepositively
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to environmentalconservation.WeurgeCongresstosupportAmerica’sforestlandownersbypassingtheForestRecoveryAct.
Signed,
AlabamaForestryAssociation
ArkansasForestryAssociation
AssociationofConsultingForesters
The ConservationFund
FloridaForestryAssociation ForestLandownersAssociation
ForestResourcesAssociation
ForestryAssociationofSouthCarolina
GeorgiaForestryAssociation
Gulf Coast Land Trust
GulfCoastLandTrust
HardwoodFederationThe LongleafAlliance
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LouisianaForestryAssociation
MassachusettsForestAlliance
MississippiForestryAssociation
MississippiRiverTrust
NationalAssociationofForestOwners
NorthCarolinaForestryAssociation
OregonForest&IndustriesCouncil
PennsylvaniaForestProductsAssociation SocietyofAmerican
Foresters
SouthernLumberManufacturerAssociation
TennesseeForestryAssociation
Southern Group of State Foresters
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VirginiaForestryAssociation Washington ForestProtectionAssociation
WestVirginiaForestryAssociation
WildlifeMississippi
TexasForestryAssociation