Hopes for the American Chestnut!!

   I got interested in this tree while camping up in the Smokey Mountain National Park. I bought a book about all the logging railroads in the Appalachian mountains and it had lots of info about this magnificent tree. Look carefully at these pictures and notice the size of the people relative to the tree. These tree were a large part of the forest ecosystem in the Appalachians and provided jobs, lumber, fences, roof shakes and an abundance of mast for wildlife!

 

   Scientists are on the brink of engineering a blight-resistant American chestnut tree, renewing hope for a comeback of a long-celebrated species that is valued by business for its sturdy hardwood. This magnificent tree once covered the Appalachian mountain range.

   For the first time, techniques used to genetically engineer sturdier farm crops are being tapped to bring back a devastated native species—one that once numbered in the billions and covered much of the East Coast. Entire forests were laid to waste by an Asian fungus introduced around 1900, and healthy chestnuts now exist only in a smattering of places in the American West, where the blight didn't reach. Now, chestnut trees whose lives began as smudges on a Petri dish are growing in upstate New York, their genes infused with a wheat DNA that appears to kill the fungus that attacks the tree's trunk and limbs. Unlike chestnuts in nature, these trees haven't succumbed so far to the blight—even when scientists directly infect them with it.

The experiments are the culmination of decades of research by scientists at the State University of New York College of Environmental Science and Forestry in Syracuse. At the same time, a separate effort was under way to splice the American chestnut with a Chinese version, producing a potentially blight-resistant tree dubbed the "Restoration chestnut." Both efforts have given hope to supporters who want the chestnut to reclaim part of its share of the forest.

   It remains to be seen whether scientists and foresters can replenish the American chestnut to its once glorious, widespread population, as the trees will take decades to mature. In addition to the tree's strong wood being used for barns, shingles and telephone poles, the tree's nuts sustained forest animals and were sold throughout Appalachia.  "It was a cornerstone species," said Stacy Clark, a research forester for the U.S. Forest Service. "It was probably the most versatile tree in the woods."The American chestnut tree, which has saw-teeth-edged leaves, shouldn't be confused with horse- or buckeye-chestnut trees, which come from separate tree families and produce inedible nuts.

   The Asian fungus that crippled the species was first detected in New York's Bronx Zoo in 1904. The disease starved the tree of water and nutrients and spread rapidly despite a quarantine effort. By 1940, billions of trees had died.  Attempts to restore the American chestnut began in the 1930s, when scientists unsuccessfully tried to breed the tree with a Chinese variety that was immune to the fungus. Federal funding dried up by the 1960s.The efforts were picked up again in the 1980s by scientists and plant lovers who founded the American Chestnut Foundation. They applied a new method, called backcross breeding, which was first used for corn that imparts preferable traits over several generations.

   The foundation started planting their new chestnuts—one-sixteenth Chinese and the rest American—in Virginia in 2006. More than 100,000 of the trees are growing across 19 states. with plans for millions more in what the group calls the country's largest ecological restoration effort. Thousands of trees were inoculated with the fungus in June 2011, with 20% showing strong resistance and 40% with a more moderate amount, foundation president Bryan Burhans said. Scientists will select for the strongest resistances when breeding future generations, he said.

   Meanwhile, scientists at Syracuse's forestry college began experimenting in 1990 with a technique called transgenics, which was traditionally used to create genetically modified crops. They inserted a fungus-resistant wheat gene into an American chestnut embryo and grew a tree from a single cell in a Petri dish. By 2006, Syracuse scientists had planted the first genetically modified trees, and they hope to gather their first nut crop this fall. The results are promising so far, as the trees haven't succumbed to blight halfway into the study. We are all hopeful that these efforts are successful in bring back this wonderful tree! 

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF            at      (706) 457-0090

What is a "Conservation Easement"?

Let’s start with a Definition -  a conservation easement (also called a conservation covenant or conservation restriction) is an encumbrance— sometimes including a transfer of usage rights (easement) — which creates a legally enforceable land preservation agreement between a landowner and a government agency (municipality, county, state, federal) or a qualified land protection organization (often called a land trust), for the purposes of conservation. It restricts real estate development, commercial and industrial uses, and certain other activities on a property to a mutually agreed upon level. The property remains the private property of the landowner.

Purpose - The primary purpose of a conservation easement is to protect land from certain forms of development or use. Lands for which conservation easements may be desirable include agricultural land, timber resources, and/or other valuable natural resources such as wildlife habitat, clean water, clean air, or scenic open space. Protection is achieved primarily by separating the right to subdivide and build on the land from the other rights of ownership. The landowner who gives up these "development rights" continues to privately own and manage the land and may receive significant state and federal tax advantages for having donated and/or sold the conservation easement. Perhaps more importantly, the landowner has contributed to the public good by preserving the conservation values associated with their land for future generations. In accepting the conservation easement, the easement holder has a responsibility to monitor future uses of the land to ensure compliance with the terms of the easement and to enforce the terms if a violation occurs.

Baseline Document -  Baseline documentation reports are the cornerstone of effective land conservation. As they record the condition of the land at the time the easement was put in place, they are essential in identifying the conservation attributes and organization plans on protecting as well as changes to the land over time, whether human or natural

Value of the Easement – is determined by the value before and after the conservation easement  i.e. the loss in value due to giving up the development rights. There are appraisers who specialize in this field. The IRS estimates that 70% of the appraisals they review are incorrect, but most do not significantly affect the economic advantage of a donation. The primary point….. “pick the right appraiser”.

A team of people are required for a successful easement. This would include a Land Trust, Appraiser, CPA and an attorney

What are the specific benefits to the landowner?

Below is a list of the general benefits for considering a conservation easement:
• The landowner maintains control and ownership of the property. The Owner may create envelopes when designing the easement.  Envelopes allow the owner to construct houses, continue farming operation and forestry operations. The key is to integrate these into the easement. These activities will be restricted after the easement is implemented.

• Each conservation easement is individually structured to meet the needs of the landowner, along with the conservation criteria, and can be structured broadly or specifically.
• The landowner assures the property is protected for future generations
• The landowner continues to receive income from his/her land from agricultural or forestry purposes
• The property may be sold and the restriction travels with the property.
• Future generations are assisted in the transfer of the land by favorable estate tax treatment. This happens because after the rights to develop it are sold, the highest and best use of the land is usually agricultural resulting in a lower appraised value for determining the value of the estate.
• Landowners may gain income tax advantages.

Federal – Tax Deduction of  30% of AGI + 5 year carry forward

Georgia -  25% tax credit for value of the easement (each state treats   conservation easements differently)

A great resource tool is the Land Trust Alliance website:   www.lta.org

In my humble opinion the easements are a great tool for high income people/entities who need ways to offset income taxes and plan to keep the property in the family for generations to come !

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF                      at      (706) 457-0090

How Much Pine Straw Can I Expect to Sell?

   I have been approached by someone who would like to rake and bale the pine straw on my property. I need to know more.

   There is an ongoing discussion about the benefits and disadvantages related to selling straw. I will not address that here. Some say it causes a loss of nutrients available to the tree and that is correct. However I can not quantify the effects.

   As a landowner, we are always looking for ways to generate income and pine straw harvesting is a viable method. Pine straw revenue varies from place to place. However Long Leaf and Slash Pine seem to generate more money per bale. Prices seem to vary from $.25 to $.50 per bale and some prices fall outside this range. I had 40 acres raked in Johnson County, GA. The trees were 13 years old. It generated 176 bales per acre or $44.05 per acre. Pretty good on top of the hunting revenue!

Here are some facts you should know:

1. Needles stay on for about 2 years

2. Avg yield between 100-200 bales per acre

3. Yield affected by age, stand density and season

4. Yield increases with increase in age up to about 15 years

5. Stand Density – 75 sq ft = 125 bales     125 sq ft = 175 bales

6. Season – most shedding occurs Sept and Oct.  Plan the harvest around Dec- Mar

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF at      (706) 457-0090

Want to save money on your property tax bill?

Then you need to learn more abour 'Conservation Use Covenant' !
 
Let's start with a definition - Owners of agricultural land, timberland and environmentally sensitive land may qualify for conservation use assessment under Georgia law. Please remember...this is different than a Conservation Easement. I will discuss that in a later article. The Georgia Revenue Commissioner has the responsibility of annually determining the values for ad valorem tax purposes of this type land and publishing rules and regulations to help county tax assessors determine the values of property that qualify for conservation use assessment. 

Conservation use property is assessed at 40% of current use value which gives a reduced assessment to the owner of this type property when compared to other property assessed at 40% of fair market value. This favorable tax treatment is designed to protect these property owners from being pressured by the property tax burden to convert their land from agricultural use to residential or commercial use, hence the name "conservation use" assessment. In return for the favorable tax treatment, the property owner must keep the land undeveloped in a qualifying use for a period of ten years or incur stiff penalties. In some states, it is referred to as 'Current Use'.

      Benefits to Landowner       Landowners receive an ad valorem tax rate deduction for their property i.e. my property tax bill was reduced from $800 to $255 per year in Johnson County, GA

      Costs to Landowner - There are no direct costs to the landowner for entering into a CUVA covenant for forested lands or agricultural lands.   There are significant penalties for landowners who break the covenant before the end of the 10-year period. Owners who break their conservation use covenant must pay back to the taxing authorities twice the savings they received over the life of the covenant up to the point it was breached, plus any applicable interest.  If the property is sold during the covenant period, the new landowner must agree to continue the covenant or the tax penalty will be levied against the property as a lien.

Term - Landowners must promise to maintain their lands in the designated use (agriculture, forestry, or environmentally sensitive) for 10 years. Landowners can re-enroll after 10 years if they wish to remain in CUVA. Landowner must enroll between Jan 1 and April 1

Eligibility - Each county tax assessor’s office administers the program independently, so application requirements may vary among counties. Generally, a minimum of 10 acres is required for enrollment, but some counties have recently increased the minimum acreage to 25 acres. No more than 2,000 acres can be enrolled in CUVA by any one non-industrial, private landowner. Foreign citizens and foreign corporations are not eligible to enroll. The land must be kept in its qualifying use and cannot be used for any non-agricultural commercial business. To qualify, you must be a natural  citizen.

Landowner Initiation Contact your local county tax assessor’s office for applications and enrollment information. Applications for conservation use assessment must be filed with the county board of tax assessors on or before the last day for filing ad valorem tax returns in the county (usually April 1st). For more specifics on CUVA, refer to the Georgia Department of Revenue’s web page at   

                         www.etax.dor.ga.gov/PTD/cas/cuse/assmt.aspx.

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF at          (706) 457-0090

Are You Doing Any Estate Planning With All That Land?

This is an important topic especially for a large landowner. Your estate may be subject to estate taxes (commonly called death taxes) when you decease. I am not qualified to make recommendations but do want to bring this important topic to mind. You should seek the advice of a Certified Financial Planner  or Certified Insurance Counselor.

If you are planning to die you missed the best year, 2010 :-) !  There were no estate taxes due that year. In 2011, your estate was taxed for that amount over $5,000,000 at a federal tax rate of 35%. The amount will go up each year. Currently the amount for 2012 is $5,120,000.

There are several tools at your disposal to help with estate planning. I will only cover 2:

Gifting – Currently you can give away assets worth $13,000. That includes both a husband and wife. Each recipient (or child) will receive $26,000. If there are several children, you can reduce the estate by a sizable amount

Insurance – This sounds simplistic, but it is a great tool. You simply buy an insurance policy that is worth the estate tax bill at time of death.

            I have included a link that has a publication about Estate Planning. It is a little dated in terms of estate exclusions and tax rates but the advice is sound.

http://www.forestry.state.al.us/PDFs/estate_tax.pdf

            Let’s talk basis. This becomes important when the property is sold. If you acquire the property by gifting,  your basis remains the same as the one who gifted you the property. Usually it is low because they have owned the property for a long time. Therefore a hefty capital gains tax may be due when the property is sold. If the property is inherited, you receive a stepped-up basis. Your basis is the FMV (Fair Market Value) at the time of inheritance. It is important that you have an appraisal done soon after the inheritance. I just completed a timber appraisal on a 350 acre farm in Meriwether County, GA. to help the owners with some planning! Estate Planning is important and it won't go away if you stick your head in the sand. Get good advice and start now!

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF at      (706) 457-0090

Who Do You Use.... Realtor or real estate agent?

   Well you are ready to sell some property… who do I use. I have access to a real estate agent and a Realtor. Let’s define a Realtor - The term REALTOR® identifies a licensed professional in real estate who is a member of the National Association of REALTORS®. Not all licensed real estate brokers and salespersons are members of the National Association, and only those who are can identify themselves as REALTORS®. Realtors conduct their business and activities in accordance with a strict Code of Ethics. For example, as agents in a real estate transaction, licensed brokers and salespersons are prohibited by law from discriminating on the basis of race, color, religion, sex, handicap, familial status, or national origin. 

   Well a picture is worth a thousand words, so study the picture closely. Being a Realtor does not make you any smarter, more motivated or cause you to possess any other attributes that makes you better. What being a Realtor does is put you in a group of professionals that work together in the selling of real property. In addition, Realtors have to operate within a Code of Ethics that real estate agents do not have to abide by. They belong to the National Association of Realtors and their State Association of Realtors and a local board.

   Let's examine the Georgia MLS portion of the graph for comparison sake. These numbers represent Dollar Volume for 2011 for the Georgia MLS (multiple listing service). The Georgia MLS is made up of both Realtors which make up 57% of the members  and non-Realtors who make up 43% of the members. NOW LISTEN CAREFULLY….. the Realtors are responsible for 85% of the dollar volume. They are more successful, generally more pro-active in their local boards and therefore list and sell more real estate. NOW, who would you like to work with !!!!

For Information on Buying or Selling Land contact G. Kent Morris, ALC, RF at      (706) 457-0090