Kenai borough eyes tax break for cutting bettle-killed timber

Posted: Tuesday, September 03, 2002

KENAI (AP) -- The Kenai Peninsula Borough Assembly is considering an ordinance that would encourage property owners to clear land of beetle-killed spruce trees by exempting landowners from paying tax increases linked to timber clearing.

Under current borough tax law, property values increase when land is cleared, because clearing is considered an improvement. Borough officials say that fact may discourage property owners from clearing beetle-killed spruce trees.

The exemption would apply to any timber clearing done to reduce the fire danger posed by timber affected by the spruce bark beetle. Any improvements to property necessary for the removal of the timber would also be exempted.

The proposed exemptions would only be granted for the year of the harvest. Landowners clearing property would be free from the increase in taxes for the year in which the harvest takes place, but would be required to pay the higher tax in succeeding years, borough tax assessor Shane Horan told the Kenai Peninsula Clarion.

The proposed ordinance also recognizes a complication posed by the 1971 Alaska Native Claims Settlement Act. Under that federal law, the removal of timber converts otherwise exempt Native corporation land into ''developed'' or taxable property.

Native corporations asked last year for a borough ordinance exempting land cleared of infested timber from being considered as taxable property.

However, Alaska law did not permit municipalities to grant such an exemption until the Legislature enacted House Bill 358 this year, granting such authority. The proposed ordinance would exempt Native land cleared to reduce fire danger from increased taxation.

Unlike in the case of non-Native property owners who must pay the tax increase in subsequent years, Native land under ANCSA will revert to a non-taxable status, Horan said.

Under the proposed ordinance, the timber cannot just be cut, it must be removed. Landowners would be required to submit a formal written application to the borough and a detailed plan of operation to the Alaska Division of Forestry.

The ordinance also would provide for retroactive exemptions for the 2001 assessment year if a completed application is filed with the assessor by Jan. 15, 2003, the deadline for filing an application for the 2002 assessment year.

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