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DEPARTMENT OF REVENUE

 

DIVISION 321

TIMBER TAXES

150-321.005(9)

Establishing Legal Taxpayer for FPHT

(1) It is the policy of the department to use the following sequential criteria to establish the identity of the taxpayer responsible for the Forest Products Harvest Tax (FPHT):

(a) The party holding title to timber as evidenced in a written agreement.

(b) If the element of (a) is not present, the party indicated on the “Notification of Operations” as the timber owner.

(c) If the elements of (a) and (b) are not present, then the party receiving payment for logs delivered to a conversion center.

(d) If the elements of (a), (b), and (c) are not present, then the owner of land from which harvest occurred is the responsible taxpayer.

(2) The following examples of transactions are a guide in determining the responsible taxpayer: [Table not included. See ED. NOTE.]

(3) The department will consider the following elements when it is necessary to interpret a written agreement in order to establish identity of the taxpayer:

(a) Type of agreement -- i.e., a contract for the performance of services vs. a contract that transfers the ownership of property.

(b) The intent of the agreement.

(c) Which party enjoys the “benefit of ownership”?

(d) Which party bears the loss in a catastrophic event?

(e) The timing of and manner of payment.

(4) Whenever an agreement is so ambiguous that identity of the taxpayer cannot be reasonably determined, the last party known to hold title to timber or logs will be deemed the taxpayer.

[ED. NOTE: Table referenced is not included in rule text. Click here for PDF copy of table.]

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.005
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; REV 6-2009, f. & cert. ef. 7-31-09

150-321.005(12)

Timber Subject to the Forest Products Harvest Tax: Measurement Standards

(1) Timber subject to the Forest Products Harvest Tax is the following:

(a) All logs which can be measured in board feet and meet the requirements of utility cull or better.

(A) Logs must be measured in western Oregon by the current edition of Official Rules for the following Log Scaling and Grading Bureaus: Columbia River, Northern California, Pacific Rim, Southern Oregon, Yamhill, developed by the Northwest Log Rules Advisory Group (NWLRAG). All sections of the publication are recognized including the Appendix.

(B) Logs must be measured in eastern Oregon by the Scribner Decimal "C" Eastside Short Log Rule, using the NWLRAG Eastside Log Scaling Handbook, First Edition 2003.

(b) Logs chipped in the woods, except chips produced from material not meeting log merchantability standards in subsection (a) above and used as hog fuel.

(c) Loads of logs measured in tons and sold by the weight that contain utility grade and better logs. Logs must be reported on the timber tax return by thousand board feet (MBF). Logs must be converted from tons to MBF using conversion factors established by the Department of Revenue. These conversion factors are listed on the tax forms and instructions sent out annually by the department:

(A) When less than 10 percent of the load's log count comes from logs that have an 8-inch or larger scaling diameter, the "Chip Log" conversion factor will be used for converting tons to MBF for tax reporting.

(B) When 10 percent or more of the load's log count comes from logs that have an 8-inch or larger scaling diameter, the "Small Saw Logs" conversion factor will be used for converting tons to MBF for tax reporting.

(2) Timber not subject to Forest Products Harvest Tax is secondary products, other than chips, manufactured in the woods and produced from logs normally left in the forest or burned as slash. Examples are shake or shingle bolts, fence posts, firewood, and arrow bolts.

(3) When timber is harvested from the eastside, but scaled using westside log scaling rule, the volume must be adjusted to reflect the eastside log scaling rule volume. Taxpayers may use their own conversion factors if they are supported by statistically sound sample data; otherwise, the westside volume must be multiplied by 1.28 to get the equivalent eastside scaled volume.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.005
Hist.: 10-7-85, 12-31-85; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-321-005, REV 2-2005, f. 6-27-05, cert. ef 6-30-05

150-321.045

Estimated Tax Payments for FPHT

(1) Any taxpayer required to report and pay estimated tax as determined by ORS 321.045(4) must file a return and pay a tax of at least 25 percent of the estimated liability for the calendar year for which the report is made.

(2) The provisions of ORS 321.045(5) are not elections or alternate methods of determining the amount of estimated tax liability, but rather standards against which estimated payments are tested for adequacy with respect to application of penalty in the form of interest.

(3) A taxpayer not required to file a return or to pay a tax for the prior calendar year is not relieved of the responsibility to pay an estimated tax. Such taxpayers must make payment equal to 100 percent of the actual liability on the timber harvested during the calendar quarter for which the report is made or at least 20 percent of the liability due for the calendar year for which the report is made.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 312.045
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; REV 6-2003, f. & cert. ef. 12-31-03

150-321.045(2)

Mailing Forest Product Harvest Tax Returns

(1) Whenever tax returns are mailed by the department less than ten (10) business days prior to the last day of January, for the preceding reporting period, the department shall waive penalty on the amount of tax due provided the tax is paid within twenty (20) calendar days of the mailing date of the return.

Example 1: Returns are mailed January 18, ten business days prior to the last day of the month, so the due date of the tax payment and return is January 31.

Example 2: Returns are mailed January 19. This is less than ten business days from the last day of month, so the deadline for filing and paying becomes February 7.

(2) Taxpayers may request an extension of time to file returns. All requests shall be:

(a) Submitted to the department in writing stating the reason for the request.

(b) Postmarked no later than the due date of the return.

(3) The department may grant up to thirty days from the due date in which to file the return. Extensions only affect the filing of the return and do not extend the time in which the tax must be paid.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.045
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; RD 6-1994, f. 12-15-94, cert. ef. 12-30-94

150-321.207(1)

Forestland Valuation Rule

(1) Purpose: The purpose of this rule is to describe the modeling process used to annually develop preliminary forestland values and to clarify the role of the models in the establishment of the final certified forestland values (ORS 321.216).

(2) General Concepts:

(a) Values to be developed by this rule are the values of bare forestland.

(b) Models will be developed to determine the statistical relationship between market sales of highest and best use forestland and reasonable indicators of value related to the forest industry in Oregon.

(c) The relationship between market sales and the indicators that best reflect the changes in forestland value over time will be used to establish the preliminary values.

(d) Separate models will be developed for Eastern Oregon and Western Oregon.

(3) Forestland Sales Data:

(a) The department will collect and verify forestland sales data. Only sales with the following characteristics will be considered:

(A) The current or immediate future use of the land is the growing and harvesting of timber;

(B) The improvement values and other nonforestland values can be accurately extracted from the sale price;

(C) The transaction is at arm's-length;

(D) The purchase consideration is cash or a financing method standard to the real estate market;

(E) The allocated bare land value is greater than $0, except for the FX productivity class in Western Oregon; and

(F) For Western Oregon sales, the value relationship between acres of each productivity class occurring on the property and sales price is identifiable.

(b) The department will compile the sales data in a forestland sales database.

(c) The department will analyze fiscal year (July 1 to June 30) data to determine a bare land value for each productivity class in Western Oregon and one value for Eastern Oregon. In doing so, the department will:

(A) Exclude individual forestland sales data that indicates values more than two standard deviations from the arithmetic mean of the forestland values for each Western Oregon productivity class or the arithmetic mean of all of the value of sales in Eastern Oregon. The department will apply this exclusion only once, either to all sales data within a productivity class on a fiscal year basis or on all sales over all years (1993 to current). If a sale is excluded for three consecutive appraisal cycles, it will be permanently excluded.

(B) Calculate the fiscal year forestland value for each productivity class as the arithmetic mean of individual sales data occurring during the fiscal year for classes FA-FX in Western Oregon and for Eastern Oregon as a whole. Only those sales remaining after elimination of any outlying sales as provided in paragraph (3)(c)(A) of this rule will be used to create the average.

(C) Replace fiscal year forestland value data that is unavailable for any of the Western Oregon classes or Eastern Oregon values due to lack of sales or after the application of paragraph (3)(c)(A). The missing data will be replaced as follows:

(i) If the missing data occurs for the first or last fiscal year, then the values will be replaced by the arithmetic average of the two closest available years for the same class.

(ii) If the missing data occurs in the intervening years, then the missing data will be replaced with the arithmetic average of the preceding and following years of the missing data for the same class.

(D) Develop acreage weighted average forestland value for Western Oregon (WAVWOR) from sales data for the current appraisal year. The acreage weights used in the WAVWOR calculation are: [Table not included. See ED. NOTE.]

(E) Develop average forestland value for Eastern Oregon.

(4) Forestland Models:

(a) Generally:

(A) The modeling process is intended to find statistical relationships between the WAVWORs for Western Oregon or the average forestland value for Eastern Oregon for the period 1993 to present and leading or coincident indicators of forestland value (such as log price trends, stumpage price trends, lumber price trends, and other indicators to be determined by the Department of Revenue).

(B) Indicators of forestland value suitable for use as inputs in the models to obtain forestland values must be:

(i) Developed based on calculation methods and assumptions that are consistent over time,

(ii) Commonly used by the forest industry as indicators of the economic potential for the production of forest products,

(iii) Readily available and verifiable, and

(iv) Relevant to the operation of the forest products industry in Oregon.

(C) The models will be based on statistically significant structural relationships between historical forestland values and leading or coincident indicators of forestland value. If such a structural model cannot be found, then appropriate time series models may be substituted for the structural models.

(D) The relationships between economic variables in the models may not be contradicted by generally accepted economic theories.

(E) The models may be amended and new models may be added in the future if a more statistically significant correlation becomes evident after the addition of subsequent years' sales data.

(F) The models will be re-estimated in each future year after the addition of the subsequent year's sales data. Re-estimation may include changes to the specification of the error or lag structure.

(G) Forecasts of forestland value will be based on a single model and not the average forecasts of several models.

(b) Model Selection Criteria:

(A) Tentative models will be estimated with stumpage, delivered log prices, dimension lumber prices, or other relevant market data at lags of zero to four years to determine the best explanatory variable for inclusion in the final model.

(B) In determining the explanatory variables to be included in the final model, both in- and out-of-sample forecasts will be compared as well as the ability to forecast turning points in forestland values.

(C) The model that displays the best correlation between the WAVWORs or average forestland value for Eastern Oregon over time and the trends in the indicators will be selected to determine the annual average forestland values (AAFV). "Best" means that the resulting statistical analysis shows major turning points in values while maintaining a close statistical relationship between the forestland values and the indicators.

(5) Determination of Preliminary Forestland Values:

(a) Western Oregon Model:

(A) The selected Western Oregon model will determine AAFV to be used as the basis for the preliminary values.

(B) Western Forestland Class Spread (WFCS) is the percentage of initial value by productivity class, FA through FX, as it relates to the acreage weighted average of these values. This spread is shown below: [Table not included. See ED. NOTE.]

(C) The WFCS will be used to transform AAFV into preliminary forestland class, FA through FX, values. This will be accomplished by multiplying the AAFV by the WFCS percentage for each individual productivity class.

(b) Eastern Oregon Model: The selected Eastern Oregon model will determine the AAFV to be used as the preliminary value for Eastern Oregon.

(6) Response to Preliminary Values:

(a) Data pertinent to the forestland valuation process that was not evaluated previously may be collected during a review by the Forestland Value Advisory Committee (ORS 321.213) or through written comments submitted during the public hearing on proposed specially assessed forestland values (ORS 321.210). The pertinent data that meets the standards in subsection 3(a) of this rule will be added to the forestland sales database.

(b) The forestland database will be re-analyzed as in subsection 3(c). This includes screening of any outlying sales data as provided in paragraph (3)(c)(A).

(c) Models will be re-evaluated considering the new forestland sales data and pertinent input on indicators that have met the standards of section (3).

(d) The process in sections (4) and (5) will be used to create revised preliminary values.

(7) Final Values: The Department of Revenue will use the revised preliminary values and any other information provided by additional research by the agency, the Forestland Value Advisory Committee, submitted written comments, or the hearing process to determine the final values to be certified under ORS 321.216.

[ED. NOTE: Tables referenced are available from the agency.]

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.257
Hist.: REV 10-2002, f. & cert. ef. 12-31-02; REV 6-2003, f. & cert. ef. 12-31-03; REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.257(3)

Forestland Classification

The forestland classification for western Oregon is as follows: [Table not included. See ED. NOTE.]
[ED. NOTE: Tables referenced are available from the agency.]

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.257(3)
Hist.: RD 6-1994, f. 12-15-94, cert. ef. 12-30-94; Renumbered from 150-321.353(1), REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.348(2)

Redetermination of Forestland Land Classes

(1) The department will change forestland land classes described under ORS 321.348(1) upon the request of an owner of forestland if the department's investigation reveals that the land class is now inaccurate.

(2) If an owner of forestland believes his or her property is not classed correctly, the owner may request a review by the department.

(a) The request must be submitted to the department in writing stating the basis of the request. Information that may be submitted as a basis for the request includes, but is not limited to:

(A) A third party evaluation;

(B) Soil surveys;

(C) Aerial photos or contour maps;

(D) Narrative that describes geographical characteristics that influence site class.

(b) The request must identify the property, including:

(A) County;

(B) Property tax account number;

(C) Legal description;

(D) Total forestland acres; and

(E) Physical location and number of forestland acres to be reviewed.

(3) The department must receive requests by April 1 in order to have a redetermination of land classes reflected on the tax roll for the tax year beginning the following July 1. If the department receives the request after April 1, any resulting redetermination will take effect with respect to the tax year commencing July 1 of the following calendar year.

(4) The department will review the information submitted, other reference materials (contour maps, aerial photos, soil surveys, land class cards, or site tree data), and may conduct a field inspection of the property.

(5) The department will send written notice of its decision to the owner. Any redetermination of land class will be immediately certified to the county assessor. This will be done prior to July 15 of the tax year for which the review decision first applies.

(6) Pursuant to ORS 305.275, the owner may appeal the department's determination described in section (5) to the Magistrate Division of the Oregon Tax Court. This appeal must be made within 90 days of the date of the written notice.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.348
Hist.: REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.349

Requirements to Qualify Certain Forestland for Special Assessment at Farm Use Values Under ORS 308A.092

(1) For forestland to qualify for special farm use assessment valuation under ORS 308A.092, the following conditions must be met:

(a) The owner must request the land be changed from a farm use to forestland designation by filing an application under ORS 308A.724 with the county assessor;

(b) Trees must have been planted after October 15, 1983;

(c) The owner must state the average age of timber upon the land involved on the application;

(d) The average age of the timber on the land must be less than 40 years;

(e) The land must have been specially assessed under ORS 308A.092 for at least 10 consecutive years before the request for special assessment as forestland;

(f) The owner of land applying for this special assessment may not own more than 2,000 acres of forestland in Western Oregon.

(2) Application forms for this special assessment program shall must be designed by the Department of Revenue. A copy of the prescribed form shall be distributed to each county assessor for in-county duplication as needed.

(3) Planting defined - planting is defined as the setting of young plants or seeds in the ground. Timber stands established naturally do not qualify as "planted."

(4) The time for filing an application for this special assessment is governed by ORS 308A.077.

(5) The farm use value for the land must be based on land class irrespective of any vegetation cover.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.349
Hist.: RD 9-1983, f. 12-20-83, cert. ef. 12-31-83; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00

150-321.353(1) [Renumbered to 150-321.257(3)]

150-321.354

Common Ownership

Definitions:

(1) "Person" means an individual, a public or private corporation, a limited liability company, a limited liability partnership, an unincorporated association, a partnership, a government or a governmental instrumentality.

(2) "Majority interest" means an interest of greater than 50 percent.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.354
Hist.: Renumbered from 150-Ch. 1078 Sec. 2 & 35 1999 by REV 6-2003, f. & cert. ef. 12-31-03

150-321.358(2) [Renumbered to 150-321.258(4)]

150-321.358(3)(b)-(A)

Date of Acquisition

In answering the question on the application for designation as forestland concerning date of acquisition, the applicant must list the exact date of acquisition if the forestland was acquired within the five year period immediately preceding the date of the application. If the forestland was acquired more than five years before the date of the application, that fact must be stated, but dates are not required.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.358
Hist.: 2-68; 3-70; 3-16-78, Renumbered from 150-321.358(2)(b) by REV 6-2003, f. & cert. ef. 12-31-03

150-321.358(4)

Minimum Stocking and Acreage Requirements for Designation as Forestland in Western Oregon

(1) To qualify, the land must have growing upon it at least the number of established trees per acre set by the state forester in OAR 629-610-0020. The established trees must be of a marketable species acceptable to the state forester as described or set forth in OAR 629-610-0050.

(2) If the land does not meet the minimum requirements of section (1) of this rule, the owner must give the assessor a written management plan for establishing trees to meet the minimum stocking requirements. The plan must contain and meet the following requirements:

(a) A description of the area that states the location, number of acres, ground cover, present stocking, steepness of slope, and aspect (the direction the slope faces.)

(b) A list of needed site preparation requirements prior to planting. Examples include brush or grass removal, rodent eradication, disease and insect problem resolution, slash disposal, protection from grazing or browsing animals, and tillage of soil.

(c) Planting information that lists the species to be planted, time of year that planting will take place, number of trees per acre to be planted, and method of planting.

(d) At least 20 percent, but not less than two acres, of the area in the plan must be planted by December 31 of the first assessment year that the land is designated as forestland. Each additional year thereafter, a minimum of 20 percent of the area must be planted. At the end of the fifth year after the assessor approves the designation, 100 percent of the area in the plan must be planted. The assessor may grant extensions to fulfilling planting requirements if a loss of planted stock occurs due to conditions beyond the control of the landowner.

(3) To qualify, the area to be designated must be at least two contiguous acres in one ownership.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.358
Hist.: 12-6-82, 12-31-82; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00; Renumbered from 150-321.358(2), REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.358(4)(b)

Acceptable Uses of Western Oregon Forestland

Certain lands do not support sufficient minimum stocking of trees to qualify for designation as forestland. However, when the use of these lands supports desirable forestry management practices on surrounding lands to promote the state policy of encouraging forestry, they may be designated as forestland.

(1) Rock Pits. Forest roads, except principal exterior access roads, are recognized as forestland under ORS 308.236. Fills, ballast, bridges, culverts, drains, and surfacing are included in the definition of forest roads. Since rock is necessary to maintain or improve the usefulness of these roads, rock pits and adjacent rock storage areas are an acceptable use and are eligible for designation as forestland under the following conditions:

(a) The rock pit comprises less than 5 percent of the total forestland of the owner in the area served by the pit.

(b) The rock from the pit is used on land defined as forestland under ORS 321.257(2).

(c) The rock produced from the pit is not commercially sold, but is used on forestland of the owner of the pit, or traded to other forestland owners in the area for in-kind products to be used at economically distant locations.

(d) The forestland owner maintains appropriate records to be available at the request of the Assessor to substantiate forest management use of rock pits and other similar items.

(2) Easements. Some lands are encumbered by easements for road or transmission line rights-of-way which prohibit establishment of commercial forests. Such lands may be valued and assessed as forestland when:

(a) Application for designation as forestland has been made.

(b) The lands are adjacent to, and an integral part of, the forest property of the owner.

(c) The lands would otherwise qualify for designation as forestland, if sufficient stocking of trees was permitted.

(d) Not more than 20 percent of the forestland of the owner is encumbered by easements.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.358
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96; Renumbered from 150-321.358(3)(b) by REV 6-2003, f. & cert. ef. 12-31-03

150-321.358(5)

Notification by Assessor of Denial of Application

The assessor will send the written notice denying the application, in whole or in part, for designation of forestland to the applicant by certified mail.

Stat. Auth.: ORS 305.100
Stat. Implemented: ORS 321.358
Hist.: 2-68; 3-70; 3-16-78; Renumbered from 150-321.358(4) by REV 6-2003, f. & cert. ef. 12-31-03

150-321.485(3) [Renumbered to 150-321.485(4)]

150-321.550

Procedure to Ensure Timber Tax Return Filing

(1) As used in this rule, "owner" shall have the meaning given in ORS 321.005.

(2) The Department of Revenue shall mail timber tax returns to timber owners as identified on Notification of Operations received from the Department of Forestry. It is the responsibility of the timber owner to assure that the correct timber owner is listed on the notification.

(3) The Department of Revenue shall document by tax program and reporting period:

(a) Which taxpayers were sent timber tax returns.

(b) Receipt of tax returns filed.

(4) Taxpayers who fail to file a timber tax return will be mailed a Notice of Failure to File which will include:

(a) Timber tax program(s) for which taxpayer has failed to file.

(b) Statement that tax return is due even if no harvest occurred.

(c) Explanation of delinquent return penalties.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.550
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89

150-321.550(1)

Notice of Intent to Harvest

(1) The owner of timber before it is cut, severed or removed, is required to give notice of intent to harvest.

(2) Notice is given to the Oregon State Department of Forestry which then issues a "Notification of Operations" -- commonly called a "logging permit."

(3) Whenever title to timber is transferred to a new owner prior to being cut, severed or removed, the new owner is required to give notice of intent to harvest.

Example 1: Landowner "A" logs timber on the owner's property and decks the logs at roadside. Trucker "B" buys "A"s logs for $10,000 then hauls and sells the logs to a mill.

"B" acquired the title to logs still on "A"s property prior to removal, therefore "B" must give notice of intent to harvest.

Example 2: Owner "A" sells standing timber to "B" on a recovery basis. "B" agrees to pay "A" $125/Net MBF for all timber removed. In the contract for the sale of the timber "A" agrees to pay any tax due as the result of the harvest.

"B" acquired title to the timber and must give notice of intent to harvest before cutting, severing or removing the timber. The fact that "A" agreed to pay the taxes has no bearing on who must give notice.

(4) Once made, the notification expires on the last day of December in the year taken. Any continuation of harvest in a new calendar year requires renewal of the notification.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.550
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89

150-321.550(3)(a)

Penalty for Failure to Obtain Notification of Operations

(1) The penalty shall be applied for each violation occurring.

(2) The penalty shall be assessed against the owner of the timber at the time the return is filed.

(3) No violation occurs if the volume cut is less than 5000 board feet.

(4) A violation occurs if separate notice is not given for cutting operations on private lands when:

(a) The operations are on noncontiguous parcels under the same ownership or;

(b) The operations are on parcels under different ownership or;

(c) The operations are greater than one mile apart regardless of ownership or;

(d) The operations are conducted by different loggers.

(5) Each sale harvested from public lands shall be considered a single cutting operation.

(6) The department shall not impose a penalty under this section without first having notified an owner by letter, sent to the most current known address, of a violation. Subsequent violations occurring after the date the notice has been sent by the department will be subject to the penalty provided under this section.

(7) The penalty provided under this section shall first apply to violations occurring on or after January 1, 1990.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.550
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89

150-321.560(2)

Prescribed Forms for Reporting Timber Harvest

(1) Owners must file a harvest return on forms prescribed by the department.

(2) Owners may report on magnetic tape or their own forms provided they meet the prescribed format, and approval is obtained from the department prior to filing.

(3) The department may reject and return to the taxpayer forms which do not meet the requirements of this rule.

(4) A taxpayer shall refile on prescribed forms if the original filing was rejected and returned by the department. A taxpayer is considered not to have filed a tax return until an approved form is filed.

(5) The taxpayer may be assessed penalty for failure to file a tax return as provided under ORS 321.560(2) and (3).

(6) If the department receives payment with a form which does not meet the requirements of this rule, the payment shall be banked and credited to the taxpayer's account for the timber tax program indicated on the taxpayer's remittance or submitted form.

(7) Effective Date: The provisions set forth in this rule shall apply to tax returns required to be filed by or after January 31, 1988.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.560
Hist.: RD 16-1987, f. 12-10-87, cert. ef. 12-31-87

150-321.609(1)

Check Scaling at the Point of First Measurement

(1) The department must be given access to any location where timber is first measured at any time the site is open for business in order to inspect or check scale the grading and measuring practices for timber subject to ORS 321.005 to 321.185, 321.560 to 321.600 and 321.700 to 321.754.

(2) Scalers or companies controlling the sites must make all pertinent information for the check scale available to the department.

Stat. Auth.: ORS 305.100 & ORS 321.609
Stats. Implemented: ORS 321.609
Hist.: RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.609(1)-(A)

Measuring Harvested Timber

(1) Definitions for purposes of this rule:

(a) "Check Scaling" is the procedure for verifying that an entity's scaling practices comply with the Official Log Scaling Rules.

(b) "Grading" means determining the quality of logs, considering such factors as gross diameter, length of log, surface characteristics, annual ring count, slope of grain and other factors as reflected in the Official Log Scaling Rules.

(c) "Harvest Unit" is a contiguous geographical area from which timber is harvested that has the following characteristics:

(A) The unit is entirely within one county;

(B) The unit is not larger than 320 acres;

(C) The unit is under one ownership;

(D) The unit is limited to harvest by one method (e.g., clearcut, thinning); and

(E) Operations within a harvest unit may not be farther than one mile apart.

(F) The department may grant exceptions to these criteria upon written request.

(d) "Measuring" means the determination of the quantity and quality of logs. Measuring must happen at the time of transfer of ownership of the logs and is the responsibility of the timber owner.

(e) "Official Log Scaling Rules" are those rules developed by the Northwest Log Rules Advisory Group as reflected in the most current edition of Official Rules for the following Log Scaling and Grading Bureaus: Columbia River, Northern California, Pacific Rim, Southern Oregon, Yamhill.

(f) "Sample Scaling" means to measure a portion of a weighed log inventory and apply the statistical information of the selection to the entire inventory.

(g) "Scaling" means the measurement of the gross and net volume of logs as determined by using the Official Log Scaling Rules.

(2) Measurement of scaled logs must:

(a) Be done using the Official Log Scaling Rules and must be determined by one of the following persons:

(A) Scalers of third party scaling organizations that:

(i) Assure its scalers produce consistent scaling results;

(ii) Assure its scalers will exercise independent judgment;

(iii) Have a training and certification program for its scalers;

(iv) Check scale a minimum of eight loads every two months for each employee scaling and grading logs subject to timber taxes under ORS 321.005-185, 321.700-754, and 321.805-855 within a 5 percent tolerance of the log volumes; and

(v) Make check-scale records available to the department upon request.

(B) Scalers employed by companies who are check scaled by a third-party scaling organization, or company check scalers employed by a company that:

(i) Meets all the requirements listed in paragraph (2)(a)(A) of this rule; and

(ii) Provides a rescale and training in the event of an unsatisfactory check scale;

(iii) Provides total volume by grade and species by harvest unit for the period between an unsatisfactory check scale and the next satisfactory check scale at the request of the department; and

(iv) Allows the department to independently check scale.

(C) Scalers employed by companies with less than four scalers who each scale less than 50 thousand board feet per week if approved by the department. The company must:

(i) Make a written request to the department which includes:

(I) Name, duties and experience of the scaler;

(II) Type of logs scaled;

(III) Scaling instructions;

(IV) A description of the scaling location;

(V) An explanation of how the scaling information is secured to prevent loss or tampering of information; and

(VI) Provisions for check scaling.

(ii) If requested by the department, provide training specific to the type of logs delivered to the scaling point.

(D) Check scalers who meet the following qualifications:

(i) Be a qualified scaler with five plus years experience scaling logs,

(ii) Participate in an effective training and certification program that is recognized by one of the bureaus that is a member of the Northwest Log Rules Advisory Group,

(iii) Demonstrate proficiency with the Official Log Scaling Rules, and

(iv) Makes record of qualifications, training and certification available upon request.

(b) Be recorded on original scaling and grading load tickets that contain the following information:

(A) Name of log seller (taxpayer),

(B) Date of measurement,

(C) Name of log purchaser,

(D) Log brand,

(E) Log species,

(F) Log Grade,

(G) Number of logs,

(H) Gross log measurements, deductions and net volume, and

(I) Trip ticket number.

(3) Measurement of weighed logs must:

(a) Be done by an employee of a delivery facility who has been instructed on the proper use of the equipment listed in subsection (3)(b) of this rule.

(b) Use weigh instruments or devices that are tested, certified or licensed by the Oregon State Department of Agriculture under ORS 618.020, 618.016, 618.121 and 618.151.

(c) Be recorded on original load tickets which contain the following information:

(A) Name of log seller (taxpayer);

(B) Name of log purchaser;

(C) State Forestry (harvest) permit number;

(D) Trip ticket (or woods trip receipt number);

(E) Date of measurement;

(F) Location of measurement;

(G) Scaling organization or company doing the weighing;

(H) Weight ticket number;

(I) Gross, tare and net weights.

(4) A taxpayer may use "sample scaling" to determine the volume and grade of logs harvested.

(a) Sample scaling must be done on a harvest unit basis and the following criteria must be met:

(A) Must meet the criteria of section (2) of this rule;

(B) The number of loads scaled (the sample intensity) must ensure that 95 percent of the time the average volume of a scaled load falls within 5 percent of the average volume of all sampled loads for the harvest unit.

(C) Samples must be selected through a random, unbiased method.

(D) Samples must be taken over the entire period of harvest.

(E) Once a load has been selected for the sample, it cannot be removed.

(b) Sampling methodology that does not meet the criteria of subsection (4)(a) of this rule may be used if submitted in writing and approved by the department prior to use.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.609
Hist.: REV 2-2005, f. 6-27-05, cert. ef 6-30-05

150-321.609(2)-(A)

Timber Harvest Records

Every owner must keep records of harvested timber that is subject to the Small Tract Forestland Severance Tax and the Forest Products Harvest Tax. These records must be retained as described in OAR 150-321.609(2)-(D). Timber harvest records required to be retained include:

(1) Contractual or financial agreements relative to the ownership and harvest of timber.

(2) Location of the harvest unit, including a map of the unit.

(3) The quantity of harvested timber .

(4) Log brands used by location and date.

(5) Log load trip tickets by harvest unit by accounting period.

(6) Original records of scaling, measuring, and grading of forest products harvested.

(7) Any other bills, receipts, invoices, data processing tapes, or other documents of original entry supporting the entries in the books of account, as well as all schedules and work papers used in the preparation of the tax returns.

Stat. Auth.: ORS 305.100 & ORS 321.609
Stats. Implemented: ORS 321.609
Hist.: 12-31-77, 12-31-79, Renumbered from 150-321.342; 12-31-80, Renumbered from 150-321.342(2)-(A); RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96; REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.609(2)-(B)

Use of Microfilm and Microfiche Records

Microfilm and microfiche records of original records and supporting data are acceptable provided the following conditions are met:

(1) Microfilm and microfiche show beginning and ending numbers and be indexed, cross referenced and labeled as to contents.

(2) The microfilm or microfiche contain the complete original records and identification can be made in respect to time of harvest and harvest area.

(3) Proper facilities including modern projectors for viewing and copying are provided during regular business hours for the ready inspection and location of the particular records. Otherwise, the microfilm or microfiche shall be made available at the Department's facilities for inspection.

(4) The taxpayer agrees to provide access to any information contained on the film or fiche which may be required for purposes of verification of the tax liability.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.609
Hist.: 12-31-77, 12-31-79, Renumbered from 150-321.342; TC 7-1980, f. 11-28-80, cert. ef. 12-31-80; RD 8-1988, f. 12-19-88, cert. ef. 12-31-88, Renumbered from 150-321.342(2)-(B)

150-321.609(2)-(C)

Records Kept by Automated Data Processing

(1) The Department of Revenue will accept records kept by automated data processing systems if:

(a) Supporting source documents are identified and kept on file so that a complete audit of the automated data processing records can be performed.

(b) Computer programs, program documentation, and program flow charts showing embedded formulas and the resulting computations are available for examination by the department.

(2) The department may verify the accuracy of any automated data processing programs used for computing log grading and scaling volumes for timber subject to ORS 321.005 to 321.185, 321.560 to 321.600 and 321.700 to 321.754.

(3) The department may perform tests to verify the accuracy of automated data processing programs using the equipment used to supply the service.

(a) Tests will consist of mock scale tickets prepared by the department with a maximum of 500 logs for each scaling method.

(b) Test printouts will be in scale ticket form, individual log detail form and in load summary form as produced for the timber owner.

(c) The test data must be run and the information sent to the department within thirty days after the date that the department sends the mock scale tickets.

(d) All testing will be at the expense of the party using automated data processing for log grading and scaling.

(4) Automated data processing records are to be retained as prescribed in OAR 150-321.609(2)-(D).

Stat. Auth.: ORS 305.100 & 321.609
Stats. Implemented: ORS 321.609
Hist.: 12-31-77, 12-31-79, Renumbered from 150-321.342; TC 7-1980, f. 11-28-80, cert. ef. 12-31-80; RD 8-1988, f. 12-19-88, cert. ef. 12-31-88, Renumbered from 150-321.243(2)-(C); RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.609(2)-(D)

Preservation of Records and Their Reproductions

All records or reproductions of records pertaining to scaling, measuring, grading and reporting of a timber harvest(s) subject to the Small Tract Forestland Severance Tax and the Forest Products Harvest Tax must be maintained for inspection. These records must be maintained for six years from the completion of a harvest or until final resolution of an appeal from an assessment relating to such harvest, whichever is later.

Stat. Auth.: ORS 305.100 & 321.609
Stats. Implemented: ORS 321.609
Hist.: 12-31-77, 12-31-79, Renumbered from 150-321.342to 150-321.342(2)-(D); 12-31-80, Renumbered from 150-321.342(2)-(D); RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96; REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.684-(A)

Requests for Confidential Information

(1) Request for information under ORS 321.684(1)(a) must:

(a) Be made in writing.

(b) Identify the type of return or report and the year or years requested.

(c) Include formal authorization if the request is from a representative of the taxpayer.

(2) Request for information under ORS 321.684(2) must:

(a) Be made in writing including a statement:

(A) Describing the records and information in detail reasonably sufficient to enable the department to identify and locate the information.

(B) Agreeing that the information requested will not be divulged or used for any purpose other than that authorized in ORS 321.684.

(b) Describe the intended use of the reports or returns requested.

(3) Requests for information made under ORS 321.684(2)(b) through (f) will be provided only upon receipt of a statement certifying that requestor has read and had explained to them the provisions of ORS 321.682 and is aware of the penalty provisions imposed under ORS 321.686.

(4) Charges for copies of records requested under this rule will be handled as set out in OAR 150-192.440.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.684
Hist.: RD 11-1990, f. 12-20-90, cert. ef. 12-31-90; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96

150-321.684(1)

Information Which May Be Furnished

A taxpayer or authorized representative will be permitted to inspect any return or report filed by the taxpayer in connection with the return.

(1) Information can be provided by telephone by an employee of the department regarding a pending refund claim, an audit report, the status of an account, a general inquiry from a taxpayer, or a request from the department, if the caller clearly establishes identification as the taxpayer or an authorized representative of the taxpayer. If a caller cannot establish a right to information, the information shall not be provided except upon receipt of a written request, and the information shall then only be provided by mail addressed to the taxpayer or other persons who have filed with the department, a general power of attorney, a special power of attorney that authorizes the disclosure of information related to the tax period or periods and tax programs, or the Department of Revenue's form titled "Authorization to Represent the Taxpayer."

(2) An "authorized representative" as used in this rule is a person designated in a written authorization executed by a taxpayer, to receive tax information on behalf of the taxpayer. The department must receive the authorization before tax information will be released to the representative.

(3) A person who is "recognized" as being authorized under ORS 305.230 to represent a taxpayer in a proceeding before a tax court magistrate or in a conference before the department may receive confidential information related to the taxpayer and to the proceeding or conference, unless otherwise prohibited by an Internal Revenue Service agreement. A person shall be "recognized" as being authorized to represent the taxpayer upon:

(a) The filing with the tax magistrate division or with the department of a document apparently signed by the taxpayer clearly authorizing such representation; or

(b) The filing with the tax magistrate division of a document signed by the representative that clearly states that the representative is authorized to represent the taxpayer with respect to the particular proceeding, and to receive from the department confidential records of the taxpayer relating to the proceeding, provided that such a statement also is in accordance with a rule of the tax magistrate division that is consistent with this rule; or

(c) The issuance by a tax court magistrate of an order declaring that such representation is authorized.

(4) In case of audit or compliance activity, a written authorization is required unless it appears to the satisfaction of the department that the representative does in fact have authority to represent the taxpayer.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.684
Hist.: REV 9-1998, f. 12-11-98, cert. ef. 12-31-98; REV 12-1998, f. 12-29-98, cert. ef. 12-31-98

150-321.700(1)

Common Ownership

(1) For purposes of ORS 321.700(1), "Direct ownership" means ownership of forestland by one or more individuals or control of property rights in forestland granted under a real estate contract, trust or other written agreement.

(2) "Majority interest" means an interest greater than 50 percent.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.700(1)
Hist.: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from OL 2003, Ch 454, Sec. 1(1) by REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.700(12)

Establishing the Identity of the Taxpayer for Severance Tax

For purposes of establishing the identity of the taxpayer for the severance tax, OAR 150-321.005(9) applies.

Stat. Auth.: ORS 305.100; 321.609
Stats. Implemented: ORS 321.700
Hist.: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-Oregon Laws 2003, Ch. 454, Section 1(12); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.700(13)

Timber Subject to the Small Tract Forestland Severance Tax

(1) Timber subject to the Small Tract Forestland Severance Tax is the following:

(a) All logs that can be measured in board feet and meet the requirements of sawmill grades or better.

(A) Logs must be measured in western Oregon by the current edition of Official Rules for the following Log Scaling and Grading Bureaus: Columbia River, Northern California, Pacific Rim, Southern Oregon, Yamhill, developed by the Northwest Log Rules Advisory Group (NWLRAG). All sections of the publication are recognized including the Appendix.

(B) Logs must be measured in eastern Oregon by the Scribner Decimal "C" Eastside Short Log Rule, using the NWLRAG Eastside Log Scaling Handbook, First Edition 2003.

(b) Logs measured in tons and sold by the weight when they meet the conditions of (A) or (B) below. Logs must be reported on the timber tax return by thousand board feet (MBF). Logs must be converted from tons to MBF using conversion factors established by the Department of Revenue. These conversion factors are listed on the tax forms & instructions sent out annually by the department.

(A) The loads of logs contain a minimum of 20 percent of the log count at 5-inch, 6-inch and 7-inch scaling diameter. The "Chip Logs" conversion factor will be used to convert this type of load from tons to thousand board feet (MBF) for tax reporting.

(B) Loads of logs in which all logs measure 5-inch scaling diameter and larger, or the load contains three or more logs with 8-inch or larger scaling diameter. The "Small Saw Logs" conversion factor will be used to convert this type of load from tons to MBF for tax reporting.

(c) Logs chipped in the woods, except chips produced from material not meeting log merchantability standards in subsection (a) above and used as hog fuel.

(2) Timber not subject to Small Tract Forestland Severance Tax is secondary products, other than chips, manufactured in the woods and produced from logs normally left in the forest or burned as slash. Examples are shake or shingle bolts, fence posts, firewood and arrow bolts.

(3) When timber is harvested from the eastside, but scaled using westside log scaling rule, the volume must be adjusted to reflect the eastside log scaling rule volume. Taxpayers may use their own conversion factors if they are supported by statistically sound sample data; otherwise, the westside volume must be multiplied by 1.28 to get the equivalent eastside scaled volume.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 305.100, 321.609 & 321.700
Stats. Implemented: ORS 321.700
Hist.: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-Oregon Laws 2003, Ch. 454, Section 1(13); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04; REV 2-2005, f. 6-27-05, cert. ef 6-30-05

150-321.706

Definition of Owner for Small Tract Forestland Purposes

"Owner" as used in ORS 321.706 to 321.716 means one or more individuals, a public or private corporation, a limited liability company, a limited liability partnership, an unincorporated association, a partnership, an estate, a trust, a government, a governmental instrumentality, or any combination of these or similar entities.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.706
Hist: REV 8-2004, f. & cert. ef. 9-15-04

150-321.706(2)

Required Signatures for Small Tract Forestland Application

(1) Small Tract Forestland applications must be signed by all owners, as defined by OAR 150-321.706, that hold the land that is the subject of the application in common ownership, as defined in ORS 321.700(1).

(2) Acceptable signatures of the forestland owner(s) are as follows:

(a) For an individual, every person with an ownership interest must sign. If applicable, a person with legal guardianship or power of attorney to represent an individual may sign.

(b) For a partnership, a general partner designated by the partnership as authorized to represent the partnership.

(c) For an S corporation, a shareholder designated by the S corporation as authorized to represent the S corporation.

(d) For an estate or trust, the trustee, executor, or other authorized representative.

(e) For a C corporation, an officer of the corporation authorized to represent the C corporation.

(f) For a limited liability company (LLC) or limited liability partnership (LLP), a member designated by the LLC or LLP as authorized to represent the LLC or LLP.

(3) A contract purchaser(s) may sign if they have authority to make the application under the terms of the purchase contract.

Stat. Auth.: ORS 305.100, 321.609
Stats. Implemented: ORS 321.706(2)
Hist.: REV 4-2004, f. 7-30-04 cert. ef. 7-31-04; REV 7-2005, f. 12-30-05, cert. ef. 1-1-06

150-321.706(4)

Powers Delegated to County Assessor

Pursuant to ORS 321.706(4) the department delegates to the county assessor the authority to:

(1) Require any person to furnish any information the assessor deems necessary to determine whether forestland is qualified for small tract forestland designation.

(2) Enter upon and inspect the land included in a small tract forestland application and any contiguous parcels under common ownership as identified in ORS 321.700(3).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.706
Hist.: REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.706(7)

Definition of Taxpayer for Appeal of Small Tract Forestland Application Denial

"Taxpayer," as used in ORS 321.706(7), means an owner of forestland that is the subject of an application for qualification as small tract forestland.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.706(7)
Hist.: REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.709(1)(b)

Contiguous Parcels Held in Common Ownership

The following examples illustrate when contiguous parcels under common ownership must be included in an application for small tract forestland assessment as required by ORS 321.709(1)(b). For purposes of this rule, all parcels are designated forestland or highest and best use forestland.

(1) Example 1: Parcel # 1 is owned by three individuals, Bob, John and Greg. Parcel # 2 is contiguous to Parcel # 1 and is owned by husband and wife (Bob and Julie). Parcel # 3 is contiguous to Parcel # 2 and is owned by Julie. Parcels # 1 and # 3 are not contiguous.

(a) Parcel # 1 is the subject of an application for small tract forestland. Parcel # 2 must be included in the application as a contiguous parcel, since Bob has an ownership interest as an individual in both parcels. Parcel # 3 is not required to be included in the application, since Julie does not have an ownership interest as an individual in Parcel # 1.

(b) Parcel # 2 is the subject of an application for small tract forestland. Parcel # 1 must be included in the application as a contiguous parcel, since Bob has an ownership interest as an individual in Parcels # 1 and # 2. Parcel # 3 must also be included in the application as a contiguous parcel, since Julie has an ownership interest as an individual in Parcels # 2 and # 3.

(c) Parcel # 3 is the subject of an application for small tract forestland. Parcel # 2 must be included in the application as a contiguous parcel, since Julie has an ownership interest as an individual in Parcels # 2 and # 3. Parcel # 1 is not required to be included in the application, since Julie does not have an ownership interest as an individual in Parcel # 1.

(2) Example 2: Parcel # 4 is owned by a partnership, 3 J's Partnership. The three partners, Bob, John and Greg, each have a 1/3 ownership interest. Parcel # 5 is contiguous to Parcel # 4 and is owned by husband and wife (Bob and Julie). Parcel # 6 is contiguous to Parcel # 5 and is owned by Bob. Parcels # 6 and # 4 are not contiguous.

(a) Parcel # 4 is the subject of an application for small tract forestland. Parcels # 5 and # 6 are not required to be included in the application, since Bob does not own a majority interest in 3 J's Partnership.

(b) Parcel # 5 is the subject of an application for small tract forestland. Parcel # 6 must be included in the application as a contiguous parcel, since Bob has an ownership interest as an individual in Parcels # 5 and # 6. Parcel # 4 is not required to be included in the application, since Bob does not own a majority interest in 3 J's Partnership.

(c) Parcel # 6 is the subject of an application for small tract forestland. Parcel # 5 must be included in the application as a contiguous parcel, since Bob has an ownership interest as an individual in Parcels # 5 and # 6. Parcel # 4 is not required to be included in the application, since Bob does not own a majority interest in 3 J's Partnership.

(3) Example 3: Parcel # 7 is owned by a corporation, Bob and Julie Inc. Bob has a 60 percent interest in the corporation. Parcel # 8 is contiguous to Parcel # 7 and is owned by a partnership, 3 J's Partnership. Bob has a 2/3 ownership interest in the partnership. John and Greg each have a 1/6 interest. Parcel # 9 is contiguous to Parcel # 8 and is owned by 2 J's LLC. Bob and Julie each have a 50 percent interest in the LLC. Parcels # 9 and # 7 are not contiguous.

(a) Parcel # 7 is the subject of an application for small tract forestland. Parcel # 8 must be included in the application as a contiguous parcel, since Bob owns a majority interest in both Bob and Julie Inc. and 3 J's Partnership. Parcel # 9 is not required to be included in the application, since Bob does not own a majority interest in 2 J's LLC.

(b) Parcel # 8 is the subject of an application for small tract forestland. Parcel # 7 must be included in the application as a contiguous parcel, since Bob owns a majority interest in both Bob and Julie Inc. and 3 J's Partnership. Parcel # 9 is not required to be included in the application, since Bob does not own a majority interest in 2 J's LLC.

(c) Parcel # 9 is the subject of an application for small tract forestland. Parcels # 7 and # 8 are not required to be included in the application, since Bob does not own a majority interest in 2 J's LLC. If Bob owned a majority interest in 2 J's LLC, Parcel # 8 and Parcel # 7 would be deemed held in common ownership and contiguous because Bob would have owned a majority interest in all three parcels.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.709 (1)(b)
Hist.: REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.709(1)(c)

Minimal Stocking and Species Requirements for Small Tract Forestland Assessment

(1) To qualify, the land must have growing upon it at least the number of established trees per acre according to OAR 629-610-0020(4)-(8) established by the state forester. Also, for the land to qualify, the established trees must be of a marketable species acceptable to the state forester as established in OAR 629-610-0050.

(2) If the land does not meet the minimum requirements of subsection (1), the owner must present to the assessor a written plan for establishing trees to meet the minimum requirements for stocking. The plan must contain and meet the following requirements:

(a) A description of the area that shows the location, number of acres, ground cover, present stocking, steepness of slope, and direction slope faces.

(b) A list of needed site preparation requirements prior to planting. An example would be brush or grass removal, rodent eradication, disease and insect problems, slash disposal, protection from grazing or browsing animals, and tillage of soil.

(c) Planting information that lists the species to be planted, time of year that planting will take place, number of trees per acre to be planted, and method of planting.

(d) At least one-fifth (20 percent), but not less than two acres, of the area in the plan must be planted by December 31 of the first assessment year that the land is designated as forestland. Each additional year thereafter a minimum of one-fifth (20 percent) of the area must be planted, in addition to the previous year's requirements. At the end of the fifth year after the assessor approves designation, 100 percent of the area in the plan must be planted. Extensions to planting requirements may be granted by the assessor if a loss of planted stock occurs due to conditions beyond the control of the landowner.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 305.100, 321.609, 321.709
Stats. Implemented: ORS 321.709
Hist.: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-Oregon Laws 2003, Ch. 454, Sec. 4 (1)(c); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.709(3)

Notation on Assessment and Tax Roll

The assessment and tax roll must show the notation "Small Tract Forestland -- Potential Additional Tax Liability" for each parcel of land that is assessed as small tract forestland.

Stat. Auth.: ORS 305.100, 321.609
Stats. Implemented: ORS 321.709
Hist: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-OL 2003, Ch. 454, Section 4(3); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.712(1)

Notification to County Assessor by Small Tract Forestland Owner

(1) ORS 321.712(1) requires a small tract forestland owner(s) to give written notice to the county assessor when:

(a) The owner acquires tax lots that are contiguous to small tract forestland they own, or

(b) The owner acquires or sells forestland that results in their owning less than 10 or more than 5,000 acres of Oregon forestland, or

(c) There is a change in use of any portion of their small tract forestland to a use that is not a forestland use.

(2) This written notification must be made within 90 days of the date of acquisition, sale or change of use.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.712(1)
Hist.: REV 4-2004, f. 7-30-04 cert. ef. 7-31-04

150-321.719(1)

Common Ownership

"Person" means an individual, a public or private corporation, a limited liability company, a limited liability partnership, an unincorporated association, a partnership, a government, or a governmental instrumentality.

Stat. Auth.: ORS 305.100, 321.609
Stats. Implemented: ORS 321.719
Hist: Hist.: REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-OL 2003, Ch. 621, Sec. 109(1), REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.741(2)

Due Date for Filing Severance Tax Returns and Requesting an Extension

(1) The department will mail severance tax returns to owners of timber, as shown on the Notification of Operations (permit) issued by the Department of Forestry, from lands assessed as small tract forestland.

(a) The returns and tax are due on or before the last day of January following the year of harvest.

(b) When the department mails the returns less than ten business days prior to the last day of January, the department will not impose any penalty on the tax due provided that the taxpayer files the return and pays the tax within twenty calendar days of the mailing date of the return.

(2) The department may grant an extension of time to file a return upon receipt of a written request for extension from the taxpayer. The department may grant up to thirty days from the due date in which to file. The extension only pertains to the filing of the return and does not extend the time in which the tax must be paid. A request for extension must be:

(a) Submitted to the department in writing, stating the reason for the request and

(b) Postmarked no later than the due date of the return.

Stat. Auth.: ORS 305.100

Stats. Implemented: ORS 321.741

Hist: REV 12-2004, f. 12-29-04, cert. ef. 12-31-04.

150-321.751(3)

Distribution of Severance Tax Receipts for Western Oregon

Monies distributed under ORS 321.751(3) are distributed to each Western Oregon county in the same proportion that the assessed value of small tract forestland in that county bears to the total assessed value of small tract forestland in Western Oregon. The department will use the small tract forestland values reported by the county assessors or information supplied on the most recent Summary of Assessment and Levies (SAL) report to make this computation.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.751
Hist: REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.754(3)

Distribution of Severance Tax Receipts for Eastern Oregon

Monies distributed under ORS 321.754(3) are distributed to each Eastern Oregon county in the same proportion that the assessed value of small tract forestland in that county bears to the total assessed value of small tract forestland in Eastern Oregon. The department will use the small tract forestland values reported by the county assessors or information supplied on the most recent Summary of Assessment and Levies (SAL) report to make this computation.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.754
Hist: REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.805 [Renumbered to 150-321.839(4)]

150-321.805(4)

Definition of "Sound Management Practices"

For the purpose of ORS 321.805(4), "Sound management practices," in addition to growing trees may include but are not limited to: range management, fire protection, soil erosion control, stream protection, cooperative wildlife management, and road access control.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.805
Hist.: REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.812 [Renumbered to 150-321.833]

150-321.815(2)(b) [Renumbered to 150-321.839(3)(b)]

150-321.815(3)(b) [Renumbered to 150-321.839(3)(b)]

150-321.815(4) [Renumbered to 150-321.815(5)]

150-321.815(5) [Renumbered to 150-321.839(5)]

150-321.833

Common Ownership

Definitions:

(1) "Person" means an individual, a public or private corporation, a limited liability company, a limited liability partnership, an unincorporated association, a partnership, a government or a governmental instrumentality.

(2) "Majority interest" means an interest of greater than 50 percent.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.833
Hist.: Renumberd from 150-Ch. 1078 Sec. 2 & 35 1999 Session by REV 6-2003, f. & cert. ef. 12-31-031999 Session to OAR 150-321.812, 12/31/03; Renumbered from 150-321.812; REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.839

Notation on Tax Roll: "Forestland - Potential Additional Tax Liability"

The county assessor must make the notation "Forestland - Potential Additional Tax Liability" on the tax roll for each parcel of land the assessor approved as designated forestland under ORS 321.839. The notation is not made with respect to parcels classified by the county assessor as highest and best use forestland.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.839
Hist.: REV 4-2006, f. & cert .ef. 7-31-06

150-321.839(3)(b)

Date of Acquisition

In answering the question on the application for designation as forestland concerning date of acquisition, the applicant must list the exact date of acquisition if the forestland was acquired within the five year period immediately preceding the date of the application. If the forestland was acquired more than five years before the date of the application, that fact must be stated, but dates are not required.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.839
Hist.: 11-71; Renumbered from 150-321.815(2)(b) by REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-321.815(3)-(b); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

150-321.839(4)

Minimum Stocking and Acreage Requirements for Designation as Forestland in Eastern Oregon

(1) To qualify, the land must have growing upon it at least the number of established trees per acre set by the state forester in OAR 629-610-0020. The established trees must be of a marketable species acceptable to the state forester as described or set forth in OAR 629-610-0050.

(2) If the land does not meet the minimum requirements of section (1) of this rule, the owner must give the assessor a written management plan for establishing trees to meet the minimum stocking requirements. The plan must contain and meet the following requirements:

(a) A description of the area that states the location, number of acres, ground cover, present stocking, steepness of slope, and aspect (the direction the slope faces.)

(b) A list of needed site preparation requirements prior to planting. Examples include brush or grass removal, rodent eradication, disease and insect problem resolution, slash disposal, protection from grazing or browsing animals, and tillage of soil.

(c) Planting information that lists the species to be planted, time of year that planting will take place, number of trees per acre to be planted, and method of planting.

(d) At least 20 percent, but not less than two acres, of the area in the plan must be planted by December 31 of the first assessment year that the land is designated as forestland. Each additional year thereafter, a minimum of 20 percent of the area must be planted. At the end of the fifth year after the assessor approves the designation, 100 percent of the area in the plan must be planted. The assessor may grant extensions to planting requirements if a loss of planted stock occurs due to conditions beyond the control of the landowner.

(3) Certain lands do not support sufficient stocking requirements; however, when the use of these lands supports sound management practices and the harvest of forest crops on surrounding lands, these lands may be designated as forestland. Examples of such lands include:

(a) Roads, landings, and rock pits used for forest roads that are necessary for forest management and the harvest of forest crops.

(b) Land that is subject to power transmission and distribution easements or gas line easements that are not centrally assessed under ORS 308.505-308.665 or 308.805-308.820 if the lands would otherwise qualify for designation as forestland if, but for the easement, sufficient stocking of trees would be permitted.

(4) To qualify for designation, the land must meet the minimum stocking requirements of sections (1) or (2) of this rule. However, when the circumstances listed in section (3) of this rule are present, and at least 80 percent of the total area applied for meets the minimum stocking requirements, the total area of the application will be assessed as designated forestland.

(5) To qualify, the area to be designated must be at least two contiguous acres in one ownership.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.805
Hist.: 11-71; TC 10-1978, f. 12-5-78, cert. ef. 12-31-78; RD 15-1982, f. 12-6-82, cert. ef. 12-31-82; RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; RD 3-1996, f. 12-23-96, cert. ef. 12-31-96; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00; Renumbered from 150-321.805, REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

150-321.839(5)

Notification by Assessor of Denial of Application

The assessor will send the written notice denying the application, in whole or in part, for designation of forestland to the applicant by certified mail.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 321.839
Hist.: 11-71; Renumbered from 150-321.815(4) by REV 6-2003, f. & cert. ef. 12-31-03; Renumbered from 150-321.815(5); REV 5-2004, f. 7-30-04, cert. ef. 7-31-04

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