22 CIRCULAR 8 9 9, U. S. DEPARTMENT OF AGRICULTURE 



crop to mature. The optional-contract provisions in these laws have 

 been used very little. They have not received much publicity and 

 the landowners who know about them seem to feel that the contract 

 would give them little added protection. 



There are both advantages and disadvantages in a contractual 

 relation between the owner and the State. The contract determines 

 the method of taxation and the rates of taxation for the contract 

 period, and thus provides the owner with a greater certainty of future 

 tax costs. The possible disadvantage of a contract is that a town or 

 county in need of greater revenue cannot increase the collections from 

 forest land under contract. 



There may be some question whether an owner of classified land 

 in a State which does not provide for a contract with the owner would 

 be subject to increased tax rates if the law were changed subsequent 

 to the entry of this land. This would have to be tested in the courts 

 of each State. In Missouri and New York the owner subject to in- 

 creased rates would have the privilege of withdrawing his lands, 

 though he would be subject to the declassification tax. In Oregon, 

 Massachusetts, and Connecticut there is no provision for withdrawal 

 of lands by the owner. The same is true for Washington, though in 

 Washington a petition for withdrawal may be filed by 25 taxpayers 

 of the county. 



Apparently the possibility that classified land might be made subject 

 to higher rates under a change in the law is not taken very seriously. 

 This attitude is illustrated by the failure of landowners in Oregon or 

 Washington to take advantage of the option to enter into contracts 

 with the State. In Michigan where no provision for a contract is 

 made the owner is protected against unfavorable changes in the law 

 by the following provisions : 



Changes in the terms, fees, taxes or other provisions of this act as from time 

 to time enacted into law shall apply to all lands which are listed after such 

 enactments become effective. Owners of lands listed under this act may without 

 prejudice apply for relisting under such laws as may from time to time be enacted 

 changing the terms, taxes or other provisions of this act. Any owner may with- 

 out penalty withdraw said lands from the operation of this act in event of any 

 change by law in the terms, fees, taxes or other provisions of this act, which 

 would materially increase the burden of the owner. 



Period ■ of classification— With the exception of Alabama all States 

 establishing contractual relations with owners set a time limit on the 

 period of the contract. Except in Louisiana these contracts are re- 

 newable upon expiration. A fixed or determinable time limit in the 

 contract itself is necessary to make it legally binding. Provisions in 

 the law setting a maximum period for contracts are to give the State 

 an opportunity to review its relations with the owner periodically. 



With the exception of Missouri none of the States that do not have 

 contract provisions set a limit on the period during which land may 

 remain classified. The Missouri law provides for the taxation of 

 classified land under the yield tax during a period or periods not to 

 exceed 25 years in any instance. The language of the provision sug- 

 gests that the classification can be renewed after the expiration of 25 

 years but the law is not specific in this respect. 



Louisiana and Missouri are thus the only States that establish 

 relatively short periods for classification. The short period in the 

 Louisiana law may be explained by the fact that the 40-year contract 



