Property Tax Programs | Green Timber

Available property tax programs

The Commercial Forest Act

The Commercial Forest Act (often referred to as CFA, CFR, CFP or CF) is a property tax incentive option that requires enrolled properties to be actively managed for sustainable production of commercial timber products. The State of Michigan offers this incentive in order to promote forest management which can benefit rural economies. The public access requirement also supplements the availability of land for hunting, trapping and fishing. Enrollment into the CF Program is permanent, and removal or non-compliance can carry stiff financial penalties.

What are the qualifications?
The CF program is open to landowners with 40 or more contiguous acres of productive and publicly accessible forestland. The landowner must also own the rights to harvest the timber on the property. Lands enrolled in the Commercial Forest program must be open to public, non-motorized access for hunting, fishing and trapping; no other public uses are required. Commercial activity other than forest management (including Christmas tree farms, commercial maple syrup production and grazing) is not permitted on CF land. Structures (including permanent deer blinds) are not allowed on CF lands even if they belong to the property owner, however the landowner retains the right to all other activities on the property. There are special stipulations regarding mineral exploration and wind turbine leases. Enrolled acres must maintain an up-to-date forest management plan which is approved by the Michigan DNR; the landowner is required to follow timber harvesting recommendations in the plan.

What is the cost of a Commercial Forest Plan?
The cost of a Commercial Forest Management Plan varies depending on acreage and desired detail of the plan. We can prepare a proposal for your unique project at no cost to you. There are no cost-sharing incentives for a Simple Forest Management Plan however you can choose to participate in the Forest Stewardship Program or the NRCS CAP 106 Program as these plans exceed the requirements for CF in most cases.

Learn more on each of these Forest Management Plan options.

The CF Program allows plans to be written for a 20-year scope, after which, the property and its Management Plan will be required to undergo an update to remain compliant within the program.

How closely is the landowner required to follow the plan?
The landowner must follow all timber harvesting recommendations set forth in the plan. Failure to do so can result in removal from the program which carries a hefty cost. Landowners must also file a cutting notice with the Michigan DNR prior to the start of any timber harvesting. Other recommendations such as wildlife habitat improvements are not mandatory.

Are there any property tax incentives associated with this program?
The annual property tax for enrolled lands is currently $1.30 per acre. This rate is increased by five cents per acre every five years with the next increase set to take place on January 1, 2022.

Relevant Links: Commercial Forest Program Information & Applications:

visit Michigan’s Department of Natural Resource’s Commercial Forest website

The Qualified Forest Program (QFP)

The Qualified Forest Program (QFP) is a property tax incentive option similar to CF in that it requires enrolled properties to be actively managed for sustainable production of commercial timber products. The State of Michigan offers this incentive in order to promote forest management which can benefit rural economies. Unlike CF, public access is not required on QFP lands; subsequently the property tax reduction is not as significant. Enrollment into the QFP is permanent and removal or non-compliance can carry stiff financial penalties.

What are the qualifications?
The QFP is open to landowners with 20-39 contiguous acres (at least 80% productive forestland) or 40+ acres (at least 50% productive forestland). The landowner must maintain an up-to-date forest management plan which meets the program requirements and has been approved by the Michigan Department of Agriculture and Rural Development (MDARD). Landowners must also own the timber rights on their property. Structures are allowed on Qualified Forest lands however the buildings and the land underneath any structures is ineligible for the property tax incentives. Owners of QFP lands are not required to allow public access for any purposes. Commercial uses which interfere with forest management are not allowed on QFP lands. Landowners are required to follow their forest management plan’s timber harvest recommendations; however, they retain all other private property rights.

What is the cost of a Qualified Forest Management Plan?
The cost of a QFP Management Plan varies depending on acreage and desired detail of the plan. There are no cost-sharing incentives for a Simple Qualified Forest Management Plan; however, in most cases, a Forest Stewardship Plan or NRCS CAP 106 Plan will exceed the QFP requirements. The QFP allows plans to be written for a 20-year scope, after which, the property and its Management Plan will be required to undergo an update to remain compliant within the program.

Learn more about each of these Forest Management Plan options.

How closely is the landowner required to follow the plan?
You must implement all timber harvesting recommended in the plan. Landowners are also required to submit an annual report summarizing timber harvested on their Qualified Forest Land at the end of the year in which harvesting has taken place. Failure to implement the recommended harvests can result in removal from the program which carries substantial financial penalties, dependent on the length of time the property has been in the program and the value in dollars of the exemption. Other recommendations in the management plan such as wildlife habitat improvements are not required.

Are there any property tax incentives associated with this program?
Owners of QFP lands enjoy a net property tax reduction of 16 mils; the total property tax is still dependent on the taxable value of the property. The value of any structures and the land beneath them will not receive the 16 mil exemption. When the owner of QFP land decides to sell property, the buyer has the option of executing a Taxable Value Affidavit. This keeps the property taxes "capped" at the previous rate. This may be a major selling point in the future as land values continue to rise. Your property tax bill could still change if your county or township levies an additional tax to fund certain projects.

Relevant Links on the Qualified Forest Program Information & Specific Forms/Applications:

More information about the Qualified Forest Program

Managed Forest - Wisconsin & Minnesota

Here in lies the property tax programs found in some of the nearby States that Green Timber provides forestry services within. While these programs are not necessarily found near our wheelhouse, we do maintain certifications, and associations with other consulting foresters, in order to serve landowners within these nearby States. If you own forestland in Wisconsin or Minnesota, and are interested in property tax incentive programs, please contact us.

These programs contain requirements and restrictions very similar to Michigan’s Commercial Forest and Qualified Forest Programs. All of these programs offer some sort of financial incentive in order to encourage or require the sustainable harvesting of timber products from enrolled, privately owned properties. These programs also require the maintenance of an up-to-date forest management plan that meets each program’s individual requirements. The specific details included in each forest management plan vary depending on the program, and do not necessarily correlate exactly to the same options detailed for Michigan’s Forest Management Planning options. Not all of these tax programs in surrounding states require permanent enrollment. Timelines and the financial incentives available can vary depending on your goals. The links provided below offer more detailed information on each individual program.

Relevant Links: