The enactment of 2015 Wisconsin Act 358 on April 16, 2016 (Act) has caused significant changes to the Managed Forest Law (MFL) Program. The Wisconsin Department of Natural Resources (DNR) monitors the MFL Program which was created to incentivize private forestland owners to adopt sustainable forestry practices and to designate their property as “open” or “closed” to public recreation. An “open” designation allows the public to access the designated property for only the following activities without further permission from the landowner: hunting, fishing, hiking, sight-seeing, and cross country skiing. A “closed” designation allows landowners to restrict public access to the designated property. Prior to the April 16, 2016 changes, a maximum of 160 acres per ownership, per municipality (city/town/village) could be designated as “closed.” Below is a discussion of some of the significant changes to the MFL Program.
Qualification in MFL Program
Qualification in the MFL Program now requires a landowner to have at least 20 contiguous acres under the same ownership. Prior to April 16, 2016, a landowner was only required to have 10 acres of contiguous ownership. Additionally, if there is any building or improvement on the land, the DNR will not accept the application for the land’s enrollment in the MFL Program. “Improvement” includes any accessory building, structure, fixture, or landscaping. Prior to the changes, only a building that was “developed for human residence” would disqualify the property from enrollment.
No Retroactive Modification of an Order
An MFL order is now defined as a contract between the state and the MFL owner. Therefore, if the laws change after land has been enrolled in the MFL Program, the Act prohibits the DNR from retroactively modifying the order to comply with such law changes. If a new law is enacted that would materially change the terms of the order, the MFL owner may elect either to accept the modifications of the order to be consistent with the new law or to withdraw voluntarily from the MFL Program without penalty.
More “Closed” Acreage and Leases Permitted
The Act now permits landowners to have 320 acres designated as “closed” rather than 160 acres. The fee for the “closed” designation is to be distributed 80% to the local municipality and 20% to the county in which the land is located rather than 100% being distributed to the state conservation fund. MFL owners may also lease “closed” land to persons for recreational activities. Before, the law prohibited such lease agreements.
Natural Disaster Restoration
If the MFL land experiences a natural disaster (defined as damage from fire, ice, snow, wind, flooding, insects, drought or disease), the DNR is authorized to allow an MFL owner to restore productivity and thus be compliant with the MFL Program. The time period to restore the land is subject to the DNR’s discretion.
The DNR is no longer required to approve a cutting notice if the cutting is required under the terms of the management plan and the cutting notice is submitted by a forestry professional (as defined in the Act). Additionally, the DNR shall not restrict a cutting so long as the cutting conforms to the management plan and is consistent with sound forestry practices.
Severance and Yield Taxes
The Act repeals the DNR’s authority to assess 5% yield tax on MFL land for timber and forest products harvested. After April 16, 2016, MFL owners should not receive any invoice from the DNR for yield taxes. Any MFL lands with outstanding yield taxes must be voided and any payments received on or after April 16, 2016 as a result of those invoices must be refunded.
The Act makes a number of changes in addition to those discussed above. If you have questions about the changes or are planning on transferring MFL land or withdrawing from the MFL Program, it may be advisable for you to discuss the Act’s impact with a legal and/or forestry professional.