Volume 2 - Opinions of Counsel SBEA No. 41
Forest and reforested lands exemption (Fisher Act) - Real Property Tax Law, § 480:
When real property entitled to the exemption authorized by section 480 of the Real Property Tax Law (i.e., the Fischer Act) is transferred in whole or in part, the exempt status of such property must be reviewed.
Either or both of the newly created parcels may continue to be entitled to the exemption, or either or both of the newly created parcels may not be entitled to the exemption because of the change in the acreage and dimensions of the original parcel.
We have received an inquiry relating to the partial exemption authorized by section 480 of the Real Property Tax Law. The question concerns a change in ownership and its effect, if any, upon the taxable status of real property with a fixed assessed valuation as provided by section 480.
According to the facts presented, a 48.7 acre tract had been carried on the town assessment roll at a fixed assessment of $4,570 pursuant to section 480. A section of this tract was sold by the owner who reserved for himself 25.58 acres. The assessors entered this 25.58 acre tract on the current roll at a value of $2,750.
The owner of the original tract formally protested this assessment on the grounds that it computes to a value of $107.50 per acre, and that such value represents an illegal increase above the fixed assessment on the original parcel, which fixed assessment computes to $93.83 per acre.
An analysis of this question includes the following series of considerations.
First, eligibility for the exemption provided by section 480 is conditioned upon certification by the Department of Environmental Conservation that the tract is classified as forested or reforested within the meaning of section 480. Upon approval of the application (which application is made in the first instance to the assessor), the assessment of the land (including improvements but excluding the value of the timber) shall be fixed or frozen. The statute directs that such land shall be so assessed so long as the forest growth shall remain uncut, and this direction must be interpreted to mean that a transfer of title to the entire tract will, in and of itself, have no effect upon the exemption.
Second, if there is a transfer of title to less than the entire tract, then there is a possibility that circumstances have been altered to the extent that either or both of the newly created parcels do not satisfy the requirements of section 480. These requirements, as briefly summarized, are that a tract of forest land must be a least fifteen acres in size, and that it must be planted with an average of not less than eight hundred trees per acre, or underplanted with an average of not less than three hundred trees per acre, or planted in such a way as to insure a merchantable timber crop under certain conditions.
Once the original tract is divided, there is no longer a single owner and either or both of the newly created tracts may fail to satisfy the acreage and/or timber requirements of the statute. Therefore, it is our judgment (concurred in by the Department of Environmental Conservation) that each owner must reapply to the assessor for recertification by Environmental Conservation that the parcels continue to satisfy the requirements of section 480. If either or both of the parcels continue to be eligible for exemption, then such exemption relates back to the original application, and the new assessment or reassessment must be related to the previously frozen value.
Third, and necessarily, the assessor must apportion the previously fixed assessed value so as to properly and accurately assess either or both of the newly created parcels. Such apportionment may be on the basis of dollar value per acre if such method is appropriate (e.g., the entire original tract is uniform in condition). However, it is also possible that separately assessed sections of the original parcel may differ in value because of location, topography or condition, and in such case the apportioned assessment of the newly created parcels may reflect such differentiation. The total, if both new parcels remain eligible, must not exceed the previously fixed assessment.
July 13, 1972