Approximately 80% of West Virginia is forested, and much of this forest land is privately owned. A concern of many landowners is whether they will receive a fair price for the quantity and quality of timber on their land. It is important for the landowner to understand what he or she needs and where to obtain assistance. A written contract is important in ensuring that the seller and the buyer both perform all expected tasks. Ownership and boundaries The first thing to determine is whether the land is owned by one party or by several parties. If more than one party is involved, all parties must agree on the sale arrangements. Otherwise, court action may be required in order to reach consensus among the owners. Before beginning a timber sale, be certain that all parties are aware of the property boundaries. The forester and logger must know exactly where the boundaries are. Without proper markings and knowledge of the boundaries, both the landowner and the logger could encounter legal problems if trees are harvested from adjoining property. It is suggested that the landowner, the forester, and owners of adjoining land walk unmarked areas and agree upon the boundaries. If an understanding cannot be reached, the boundary may need to be surveyed by a licensed surveyor. If boundary lines are in question and a survey is not feasible, a buffer area can be left unharvested as a protection against trees being harvested from a neighbor's property. However, less timber will be harvested, with the result being a lower price for the entire boundary of timber. Once the boundaries are determined, the landowner can begin woodland management and plan a timber sale. A written contract, entered into with the advice or assistance of an attorney, should be used for the sale of timber. The purpose of a contract is to detail the responsibilities of each party involved in the timber harvest, thus protecting both the landowner and the timber buyer. Once the contract is written, it should be reviewed by the landowner, the forester, and an attorney. It should not be signed by any party until all provisions are considered to be satisfactory. Professional assistance In many respects, landowners benefit greatly from having a professional forester assist with a sale of timber. Those benefits typically include a well-planned, environmentally friendly harvesting operation; use of better forest management practices; and a higher sale price. In fact, a study conducted by the U.S. Forest Service showed that landowners who have secured professional assistance and used the competitive bid process have received 47% more money than they were offered initially, with only about half the amount of timber being harvested.
Other important contract considerations that further protect the landowner include:
Also in the contract, both parties should consider such postharvest factors as:
Tax considerations Care should be taken, in most cases, to ensure that the proceeds of the sale are treated as a capital gain for tax purposes. West Virginia severance tax is also a consideration. A tax specialist knowledgeable of timber sale taxes should be consulted. Other considerations Terms concerning protection of the land, residual timber, reproduction, or improvements generally should be decided with advice of a forester familiar with the property and with local practices and customs. The objective is reasonable terms for both parties. Excessively strict terms may scare bidders and reduce the offered price. Justifiably, buyers may be hesitant of inexperienced sellers with unreasonable expectations. A consulting forester is foremost a representative of the landowner, but he or she also helps protect the buyer from a seller's unreasonable demands. |
