April 15, 2016

WI Act 358 makes changes to Wisconsin’s Managed Forest Law (MFL) and Forest Crop Law (FCL).  Below is a summary of some important changes, as quoted from the WI DNR interim guidance, that start immediately.

Severance/Yield taxes:
Act 358 removes DNR authority to assess (invoice) and collect 10% severance tax on FCL land and 5% yield tax on MFL land for timber and forest products harvested.
No invoices for yield or severance tax will be sent starting April 16, 2016 for MFL and FCL lands. For MFL or FCL lands with outstanding yield or severance tax due, the invoice will be voided and any payments received from those invoices on or after April 16, 2016 will be refunded.
Cutting Notices and Reports are still required to be submitted for both MFL and FCL lands since the statutes requiring them were not affected by this Act.

Act 358 specifies that MFL orders are now considered contracts. If a statute is enacted or a rule is promulgated in the future that materially changes the terms of the order, a landowner must accept the modifications to their contract or voluntarily withdraw the land without penalty. More guidance on this provision will be shared in the future.

Act 358 requires land designated as MFL open (to public recreation) to be accessible to the public on foot by public road or from other land open to public access. Other lands open to the public may include: public land (state, county, federal), open MFL, FCL land and/or land accessible by easement. This applies to all current and future entries. Land designated as MFL closed is not subject to the access requirement. Land surrounded entirely by MFL closed or non‐MFL lands owned by the same owner are eligible to be designated as MFL open because s. NR 46.20(2), Wis. Adm. Code. indicates that the public has the right to cross those lands to access the open land.
MFL Lands surrounded by land not owned by that owner but which are accessible to the public by an easement or by other means may be eligible to be designated as MFL open.
The access to the open land must be signed according to s. NR 46.21(c), Wis. Adm. Code if the access is through MFL closed land, non‐MFL land and/or by easement.

Closed acreage limit:
Act 358 raises the closed acreage limit on MFL lands. The new statutory language states that an owner may designate not more than 320 acres of MFL land as closed to public access in each municipality. This means no more than 320 closed acres per owner, per municipality.
The current rules as listed in s. NR 46.19(3), Wis. Adm. Code, will still be used to designate closed acreage. A land owner can:
– Designate as closed all of the acreage in a Managed Forest Law parcel or multiple parcels (MFL parcel, not tax parcel).
– Designate as closed all of the owner’s MFL land in a quarter‐quarter section, government lot, or fractional lot.
– If necessary, designate an additional block of acreage within a legal description, not exceeding a length to width ratio of 4:1, to complete the total closed area.
In summary, unless an owner is closing an entire MFL parcel, they must close all the acres in one legal description before closing acres in another legal description.

Leasing MFL lands:
Act 358 repeals the prohibition of leasing MFL lands that had been enacted in 2007. An owner of managed forest land that is designated as closed may enter into a lease or other agreement for consideration that permits persons to engage in recreational activities on the land. All current and future MFL closed acres may be leased for recreational activities.