From BC Assessment
Forest land: A warning to potential purchasers
Purchasers of private forest land should be aware that the land may be assessed at a higher value to account for the economic benefit of timber that was previously harvested on that land. Exit fees may also be charged if the property is removed from Managed Forest Class.
The property class that deals with private managed forest land is Class 7 Private Managed Forest Land. Land in this class is valued on a two-part basis, as detailed in section 24 of the Assessment Act:
- the bare land value, which incorporates such factors as soil quality, accessibility, topography, parcel size and location; and
- the added value of the timber on the land, which becomes assessable when it is harvested. For example, timber harvested in the calendar year 2008 will show up as added value on the assessment notice of a forest land property for the 2010 assessment roll. For property taxes payable in the summer of 2010, part of the value may come from the harvesting of trees two years previously.
Prospective purchasers of property classed as forest land are advised to enquire about previous harvesting on the property, and its possible property tax implications.
Exit fees may be incurred for those properties removed from Managed Forest Class. The exit fee is intended to encourage long-term participation in the Managed Forest Program and is applied to property that is removed from Managed Forest Class prior to a 15-year timeframe.
The land and harvested timber are valued on the basis of legislated rates prescribed by the Assessment Authority. The rates for the 2010 assessment year are founded in BC Regulation 90/2000.
For information on exit fees, go to the Private Managed Forest Land Council website at pmflc.ca, or contact Stuart McPherson at 250-386-5737.
For more information, contact Alan Stock, Senior Appraiser, BC Assessment, at 250-595-6211, local 256.