Plum Creek and state officials are at odds over whether the logging company violated its forest management plan — and if so, what the penalty should be.
Depending on the determination, more than 56,000 acres owned by Plum Creek, one of the largest private landowner in the United States, could be taxed on the parcel’s fair market value rather than its current forestry use — a tax bill hike that could range from $600,000 to $900,000 over the course of five years.
Matt Langlais, forester for Caledonia and Essex counties, cited Plum Creek for improperly harvesting timber in late 2009 and early 2010. The alleged violation occurred on 139 acres in Lemington. It’s a fraction of the 132,000-acre “Champion Lands” conservation project spanning 14 towns in the Northeast Kingdom. Plum Creek bought thousands of acres from Essex Timber Co. in 2008 after the conservation project was completed.
The two parties recently spent six days in Essex Superior Court in Guildhall — if you count May 28, when lawyers and Judge Mary Miles Teachout conducted a site visit to the area in question. There is no word at this time when the appeal may be decided, but both parties were given 30 days to file proposed findings with the court, according to Assistant Attorney General Thea Schwartz, who could not comment further on the pending case.
The case
This isn’t Plum Creek’s first appeal on the matter. The company appealed an initial “adverse inspection report” to then-Commissioner Sarah Clark, of the Department of Forest, Parks and Recreation, on Aug. 4, 2010. She upheld the violation, so the company pursued the appeal to the state’s Superior Court.
Plum Creek previously had said it did not dispute the violation itself. But Mark Doty, the company’s Maine-based communications director, said a different picture emerged after the scope of the penalty became clear.
It wouldn’t be fair to pull the entire 56,604-acre parcel out of the state’s Use Value Appraisal program (otherwise known as “current use”) for an infraction on a mere 140 acres, the company reasoned.
“We were willing to accept the cut-contrary report even though we disagreed on some of the items. But because of the potentially very large penalties, we took a closer look,” Doty said. “And that’s why we appealed it to the commissioner.”
Doty clarified that, based on the company’s measurements, Plum Creek feels that its contractor did not cut contrary to the forest management plan. The contractor in question, whom Doty declined to name, is referenced in court documents as having not followed company directions on the 140-acre cut.
“We have not used the contractor since,” he said.
The forest for the trees
The larger implication of Plum Creek’s appeal — and its ultimate determination — regards current use regulations, in general. Forest management plans apply to “parcels,” meaning that entire parcels are at stake when it comes to adhering to those plans.
Plum Creek’s alleged 140-acre cut violation was on a 56,604-acre parcel which comprises about 66 percent of the roughly 86,100 acres it owns in Vermont.
As larger landowners avail themselves of the current use tax incentive program, the ante raises. The larger the parcel, the higher the risk from violation.
Efforts to revise current use regulations have failed Vermont’s Legislature in recent years. Those include one proposal to create a graduated penalty scale that disqualifies 100 percent of a parcel from current use only on a third violation. Another bill would have ramped up the percentage of fair market value to be paid by landowners who bring their property out of current use, depending on how long they have owned the property.
The state maintains that current law as it’s written, however, is clear. The Department of Taxes, Division of Property Valuation and Review concluded its pre-trial memorandum in the Plum Creek case by saying that, “Although Plum Creek raises some well-reasoned policy arguments regarding the effect of the removal of the entire parcel in the case of very large land owners, questions regarding the formation of public policy are for the Vermont Legislature to decide, not this Division.”