State Fiscal Highlights
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STATE
FUND
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FY 2001
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FY 2002
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FUTURE YEARS
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General Revenue Fund
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Revenues
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- 0 -
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- 0 -
|
- 0 -
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Expenditures
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Potential minimal increase
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Potential minimal increase
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Potential minimal increase
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·
The
reimbursement of expenses of the eight Wayne National Forest Study Committee
members would minimally increase costs for the state.
·
Other
provisions of the bill would primarily affect the U.S. Forest Services’
transactions with private landowners and not the state. However, the state
could potentially forfeit gaining revenues from future sales of state-owned
lands to the United States Forest Service. Moreover, the state could
potentially save in maintenance costs, since the state would not be responsible
for maintaining lands purchased by the U.S. Forest Service from the state.
Local Fiscal Highlights
·
This
bill has no direct fiscal effect on political subdivisions. The bill would
primarily affect transactions with private landowners. However, local
governments could forfeit future revenues that would have been gained with
future purchases of land by the U.S. Forest Service. Likewise, the local
governments would no longer be responsible for maintaining public lands that
would be purchased by the U.S. Forest Service.
Detailed Fiscal Analysis
This bill creates a
four-year moratorium on land purchases by the United States Department of
Agriculture’s (USDA) Forest Service in certain counties; the bill also creates
the Wayne National Forest Study Committee to study the economic and social
impact that the Forest has had on people in the affected areas. Lastly,
provisions remove the requirement that county commissioners pay for the notice
of intent to purchase lands and requires the USDA Forest Services to pay for
these notices.
The bill temporarily revokes
the state’s consent for the USDA Forest Service to acquire land in Hocking,
Monroe, Morgan, Noble, Perry, Athens, Gallia, Washington, Jackson, Vinton, or
Lawrence counties. These counties are
located in southeastern Ohio and have the Wayne
National Forest located in part or all of the counties. These
changes would affect transactions between the USDA Forest Service and private
landowners in the area.
Current Process
The land is acquired through
“arms length transactions” where a willing buyer and a willing seller enter
into an agreement to sell/purchase the land at a fair market value. The U.S.
government must pay landowners fair market value for the land. Land that is in
the National Forest Program is exempt from property taxation. Two programs help
replace the lost revenues, which are administered by the Ohio Department of
Natural Resources, for distribution back to local governments and school
districts. The first program is commonly referred to as the 25% fund (Line-item
725-640) and it returns 25 percent of the gross receipt revenue collected from
forest activities (timber sales). In FY 2001 and FY 2001, $55,000 has been
appropriated for distribution back to county governments. The second funding
source (Line-Item 725-641) provides 25 percent of income from mineral
management. In FYs 2001 and 2002, $185,000 and $190,000 is appropriated for
distribution back to county governments. It is at the county’s discretion to
how the distributed monies are to be used.
Estimate of Current Tax Loss
One method to estimate the
tax revenue loss from land purchased from private landowners in the Wayne
National Forest is to use countywide values for current agricultural use valuation
(CAUV) program to approximate (please see the LBO Policy Brief on CAUV for more
information). While this does not give an exact revenue loss, one can assume
land purchased by the Wayne National Forest would meet the characteristics of
land qualifying for the CAUV program. The CAUV program allows qualifying
agricultural land (which includes timber/forested land) to be based on its
current use value and not market value. Statewide, CAUV represents about a 74
percent reduction in the market value of qualifying agricultural land (please
refer to the LBO CAUV Policy Brief), but the reduction averages about 33
percent in the Wayne Forest counties. Using the county wide CAUV average to
determine Wayne National Forest land value and county wide effective tax rates,
LBO has determined that lost property tax revenue from current federal forest
land in the above counties is approximately $500,000 annually, or about $2.36
per acre.
Wayne National Forest Study
Committee
This bill also creates the
Wayne National Forest Study Committee with the responsibility of studying the
social, economic, natural resources conservation, and quality of life effects
of the Forest. The eight-member committee is required to submit a report of
findings, including a recommendation regarding whether to extend the four-year
moratorium on land purchases. The report will be due no later than three years
after the effective date of the bill. At that time, the committee will disband.
The bill provides for
reimbursement of travel and related expenses to the committee members, which
would minimally increase state costs.
q LBO staff: Sybil Haney,
Budget/Policy Analyst
Jeff Petry, Economist
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