Feature Article January 29, 2004
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Foresters expect Liberals to rein MPAC in
A group of Foresters who have been participants in the government-sponsored Managed Forests Tax Incentive Program (MFTIP) are waiting for a review to be completed by the Ministry of Natural Resources and the Ministry of Finance to see if they will receive redress for a change in tax assessments on their managed forests. The change would lead to large tax increases this year if left in place.
Last year, the Municipal Property Assessment Corporation (MPAC) decided to change the way MFTIP properties were assessed. Until then, they were assessed in an identical manner to agricultural lands. The assessments were based on the crop value of the land, the potential value of the forestry products produced, and then taxed at 25% of the residential rate.
As of the 2003 assessment year, which will be used to determine 2004 taxes, Managed Forests are still taxed at 25% of the residential rate, but are being assessed at market value instead of crop value. And this is an inflated market value, according to Peter Schleifenbaum, a member of the Haliburton Forest Owners Association, but then again, MPAC never deals in an above board manner.
According to Schleifenbaum, some of the properties in Haliburton are seeing assessment increases of up to 800%.
The Ontario Woodlot Association has been attempting to get this situation reversed on behalf of foresters within the Managed Forest program, and met as recently as January 8 with Ministry of Finance officials. Subsequent to that meeting, the Ministry of Finance has decided to review the entire MFTIP program, including the assessment issue, and says the Ministry of Natural Resources has estimated that this review could take as long as 90 days to complete.
We think this is good news, says Wade Knight of the Ontario Woodlot Association. It is an indication that the MNR and the Ministry of Finance are closer than they have been.
At one point the Haliburton Forest Owners Association had said they were not pleased with the delay in resolving the issue, and threatened to close snowmobile trails on lands owned by their members.
The Association said in a press release Forest land owners have similar practices as farmers, just longer crop rotations. To receive MFTIP status, landowners must pay a professional forester to develop a management plan and sign five-year renewable contracts. MFTIP was designed to provide incentives to keep lands forested.
In the end, most of the members of the Association backed down and decided to leave the trails open in order not to harm the winter tourist season in their area, but vow they will act if the Ministry of Finance does not rein MPAC in over this issue.
The province has broken a contract with landowners, and is wrecking a program that worked and supplied both economic and conservation benefits This is threatening the sustainability of private land forestry, which is an important component of the local economy in rural Ontario, said Schleifenbaum.
