Mississippi forest landowners were surveyed to determine average discount rates or “hurdle rates”—the lowest rates of return they consider acceptable—for 3 nonforestry investments, and for 5, 15, and 25 yr forestry investments. The survey included 829 individuals who owned at least 20 ac of uncultivated land and had harvested timber during a recent 5 yr period; survey results are therefore oriented toward commercially active forest landowners. On average, the private nonindustrial forest landowners included in the survey expect timberland investments to earn higher rates of compound interest than relatively low-risk bank savings accounts and certificates of deposit. Relatively short-term (5 yr) timberland investments, however, have lower minimum rates of return than stocks, bonds, and mutual funds. With forestry investments, all else equal, Mississippi nonindustrial private forest landowners prefer shorter time periods—average hurdle rates in nominal terms before taxes were 8.0% for forestry investments lasting 5 yr, 11.3% for those lasting 15 yr, and 13.1% for those lasting 25 yr. Household income significantly influenced the lowest rate of return considered acceptable for 5 yr forestry investments—the rate was 9% for landowners with annual incomes above $50,000 and 7.4% for landowners with annual incomes below $50,000. On a hurdle rate basis, higher income private landowners in Mississippi generally find forestry investments lasting 15 yr to be competitive with stocks, bonds, and mutual funds. However, Mississippi landowners' 13.1% required rate of return for 25 yr forestry investments was higher than the rate considered acceptable for the other investments included in the survey. Reforestation tax incentives, cost-shares, and related public policies that reduce the front-end costs incurred by NIPF landowners tend to increase the projected rate of return for relatively long-term reforestation investments. South. J. Appl. For. 26(1):26–31.
The absence of available credit to finance reforestation investments among NIPF landowners has been one of the contributing reasons why landowners do not reforest after harvest. Financial assistance programs are therefore a solution to initiating reforestation investments. However, previous studies indicate many landowners are not actively participating in existing government assistance programs. This paper examines reforestation loans as an alternative financial assistance program. Landowner participation in a proposed reforestation loan program is modeled using logistic regression. Results indicate that landowner participation in the program is influenced by ownership size, socio-demographic characteristics, and availability of other forestry incentive and assistance programs.
Standing timber is exempt from property taxation. Forest land subject to the property tax is assessed on its fair and reasonable market value. This is determined by the local assessor from information entered on the tax return and other available information. ALASKA Alaska has no instructions for assessing forest properties.
Nonindustrial private forestland (NIPF) landowners in Mississippi who recently harvested timber were surveyed to examine their regeneration behavior. Differences between regenerators and nonregenerators were investigated by looking at the different factors affecting reforestation decisions. A discriminant analysis was used to identify factors that were useful in differentiating between regenerators and nonregenerators. Ownership size; sociodemographic characteristics such as income, education, place of residence, and age; awareness of existing government incentive/assistance programs; and participation in educational programs were significant variables in differentiating between regenerators and nonregenerators. Landowners who own larger timberlands had a higher propensity to engage in regeneration activities after harvests. This also was true for landowners who had higher income levels and educational attainment, and were younger, city resident, and white. Landowners who were aware of existing government incentive/assistance programs and those who participated in educational programs also were more likely to participate in pine regeneration. Landowners in Mississippi considered both ecological and economic reasons as highly important considerations in their decision to regenerate. The belief that the land would reforest itself to pine naturally, the high cost of reforestation, and lack of information on reforestation options were top reasons cited by landowners for their decision not to regenerate. South. J. Appl. For. 28(4):189–195.
The Tax Reform Act of 1986 (TRA'86) may reduce the timber-growing profitability of noncorporate landowners in the South. Effects vary by site index, length of rotation, market area, and tax provision. The long-run timber supply will be adversely affected by TRA'86. Short-run effects were not determined. Many producers will continue tree production with reduced profitability after TRA'86 because no better use for timber producing assets exists. Additional production and marketing efficiencies will be squeezed into tree production at the margin because of TRA'86. Some marginal producers, unable to become more efficient, may exit the industry. South. J. Appl. For. 15(3):113-117.
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