AB856,1,6 1An Act to repeal 77.82 (1) (bp) 2. g., 77.83 (2) (ar) and 77.88 (3m); to renumber
2and amend 77.82 (11); to amend 70.365, 77.82 (1) (a) 1., 77.82 (4), 77.84 (1),
377.88 (2) (ac) 3., 77.88 (2) (c), 77.88 (3) (am), 77.88 (3) (b) (intro.), 77.88 (3j) (title),
477.88 (3j) (a) 1., 77.88 (3k), 77.88 (3L) and 77.88 (5m); and to create 77.82 (1)
5(bp) 4. and 77.82 (3) (h) of the statutes; relating to: the managed forest land
6program.

This bill makes numerous changes to the managed forest land (MFL) program
administered by the Department of Natural Resources.

Under current law, certain forested land may be designated as MFL under a
program administered by DNR. Under this program, the owner of land designated
as MFL makes an annual acreage share payment that is lower than, and in lieu of,
the property taxes that normally would be payable. In exchange, the owner must
comply with certain forestry practices and have a management plan prepared for the
land. The owner must also open the MFL to the public for hunting, fishing, hiking,
sight-seeing, and cross-country skiing, but may designate up to a certain number
of acres as being closed to the public. For MFL that is designated as closed, the owner
must pay an additional closed acreage fee. An owner seeking to have land designated

as MFL submits an application to DNR that contains a management plan for the
land. If the MFL meets the eligibility requirements under the program, which
include minimum acreage requirements and requirements as to how much
merchantable timber can be produced on the land, DNR approves the application
and issues an order designating the land as MFL. An owner may choose to have the
order last 25 or 50 years.

Under current law, a parcel of land is eligible for designation as MFL only if it
consists of at least 20 contiguous acres. This was increased from a minimum of ten
acres under 2015 Wisconsin Act 358. Under current law, the fact that a lake, river,
stream, or flowage, a public or private road, or a railroad or utility right-of-way
separates any part of the parcel from any other part does not render it
noncontiguous. Under this bill, land in a parcel may be composed of individual
portions no smaller than ten contiguous acres each that are not contiguous to each
other as long as all such portions are contained within a tract of contiguous land of
20 acres or more that is under the same ownership. Under the bill, the fact that a
lake, river, stream, or flowage, a public or private road, or a railroad or utility
right-of-way separates any part of the land from any other part does not render a
parcel noncontiguous and does not render ownership of the land noncontiguous.
These changes first apply to land designated as MFL by an order issued on July 1,
2016, which is the date on which the minimum acreage change and other eligibility
changes under Act 358 first applied.

Under current law, land is not eligible for designation as MFL if a building or
an improvement associated with a building is located on it. Current law specifies
that an improvement includes any accessory building, structure, or fixture that is
built or placed on the parcel for its benefit, but does not include, among other things,
a structure or fixture needed for sound forestry practices. The bill eliminates this
exception to an improvement, but more broadly provides that the prohibition on
buildings and improvements does not apply to a building used exclusively for
storage. This change also first applies to land designated as MFL by an order issued
on July 1, 2016.

Under current law, an owner of land that is designated as MFL may file an
application with DNR to designate an additional parcel of land as MFL if the
additional parcel is at least three acres in size and is contiguous to any of that
designated land. Under this bill, such an additional parcel may be any size and must
only be contiguous to land under the same ownership that contains the designated
land as long as any portion not contiguous to the designated land meets the ten-acre
minimum requirements under the bill. The bill specifies that the eligibility
requirements applicable to such an addition are the eligibility requirements under
the order that designated the parcel to which the land is being added.

Under current law, if a statute is enacted or a rule is promulgated during the
period of the order that materially changes the terms of the order, the landowner
must elect between acceptance of modifications to the contract consistent with the
provisions of the statute or rule or voluntary withdrawal of the land without penalty.

This bill adds that a statutory change does not constitute a material change to an
order unless, in the act that makes the change, the legislature states that the act or
a provision in the act makes a material change to orders entered into under prior law.
Under the bill, this first applies to this bill, itself, which does not contain such a
statement. Further, under the bill, a promulgated rule does not constitute a material
change to an order unless the rule includes a statement that the rule constitutes a
material change to orders entered into under prior rules and DNR includes in its
report to the legislature on the proposed rule a statement that the rule constitutes
a material change to orders entered into under prior rules and an analysis of this
determination.

This bill reinstates a requirement that DNR assess a withdrawal tax and fee
against an owner of MFL who voluntarily withdraws part or all of a parcel, which was
eliminated under Act 358.

Current law allows an owner of MFL to sell or otherwise transfer all or part of
the owner's parcel of MFL, and the transferred land continues to be designated as
MFL if it meets eligibility requirements and the transferee certifies to DNR an intent
to comply with the existing management plan for the land and any amendments to
the plan. If the transferee does not provide this certification to DNR, current law
requires DNR to issue an order withdrawing the land and to assess against the
transferee the withdrawal tax and fee. Similarly, after a transfer if the remaining
land in the parcel does not meet eligibility requirements, current law requires DNR
to issue an order withdrawing the land and to assess against the owner the
withdrawal tax and fee. Under this bill, in both of these circumstances DNR may,
but is not required to, assess the withdrawal tax and fee.

Under current law, an owner of MFL may request to withdraw part of a parcel
and DNR must issue an order of withdrawal if DNR determines that the parcel is
either unable to produce merchantable timber in the amount required by law or
unsuitable, due to environmental, ecological, or economic concerns or factors, for the
production of merchantable timber. Current law requires that the order withdraw
only the number of acres necessary for the parcel to resume its ability to produce the
required amount or to resume its sustainability to produce merchantable timber, and
prohibits the assessment of a withdrawal tax or fee for the withdrawal. This bill adds
that, if the land remaining in the parcel after the withdrawal will not meet eligibility
requirements under the order designating the MFL, the order must withdraw the
entire parcel, and may not assess a withdrawal tax or fee.

Under current law, generally an owner of MFL may voluntarily withdraw part
of a parcel of the owner's land once per 25-year order and twice per 50-year order
if the purpose for which the owner requests the withdrawal is for the sale of one to
five acres of the land or for a construction site. Current law separately allows an
owner of MFL to sell or transfer ownership of all or part of the owner's land an
unlimited number of times per order. This bill harmonizes these provisions by
removing the sale of land as a purpose for a voluntary withdrawal under the former.

The bill authorizes DNR to promulgate rules that subject large ownerships,
meaning 1,000 or more acres of land designated as MFL under the same owner, to
management plan requirements that deviate from the requirements that apply
under statute.

The bill removes a current law provision stating that a building on MFL is taxed
as personal property, and eliminates the current law penalty that applies for failure
to pay such personal property tax, which is withdrawal of the land from MFL and
assessment of the withdrawal tax and fee.