Herald and news. (Klamath Falls, Or.) 1942-current, December 18, 1960, Image 3

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Herald and news., December 18, 1960, Page 3, Image 3

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Newspaper Page TextHERALD AND NEWS, Klamath Falli, Ore. Sunday, Dee. IS, IKS Tax Reforms Would Remove Handicaps On Timber Industry, Speaker Declares face s-ATHE BRIGHTEST STAR A Christmas Fantasy Timber taxation in Oregon im poses several handicaps for the private operator attempting to maintain a sustained yield for estry program, Klamath Falls Ro tary Club members were told Fri day. Speaker at the noon lunch eon meeting was Irvin H. Luiter, Portland, public affairs manager for Weyerhaeuser Timber Com pany. "Proper forest management Is everyone's concern, particularly in the state of Oregon," Luiter said. "It is your concern, though you may not own a single acre of forest lands, not a single stick of timber." Luiter pointed out that more than 50 per cent of the economy of Oregon is directly dependent upon the forests. One out of every two people working in manufac turing plants in Oregon is em cloved in the forest industries. Sixty per cent of the payroll dol lars generated by manufacturing in 'Oregon are provided by the forests, Luiter pointed out. He also cited the benefits of recre ation, water and soil conservation, fish and game, and scenic beauty of the forests as added advan tages enjoyed by people of Oregon. Weyerhaeuser, as one of the private tiimber operators in the state, has a policy and practice of sustained yield management of forest properties, Luiter explained. Those operators practicing sus tained vield management are ac tually being penalized under the present tax structure, Luiter saia. And, the future holds only addi tional penalties and declining bal ances, he added. The tax struc ture actually is a threat to sus tained vield forestry, the speak er exDlained. The tax laws do not adequately recognize the dif ference between timber and other classes of property, he said Sustained-vield operations are TK-nnlized in this way: For prop erty tax purposes the values of merchantable timber are discount edpresently to 30 per cent In the fir region and 35 per cent in the pine of current market val ue. (The discount factor will be raised to 35 per cent in 1961 in the fir region also.) This is done on the theory that all the timber in the state can not be cut Immediately and that it therefore has a "wholesale" value which is less than current market value. To determine the amount of dis count required to arrive at this wholesale value, the Tax Com mission uses this procedure: It divides the state into two areas, East and West. It then averages out in each of these areas the rate at which all private own ers are cutting their merchant able timber. This rate of deple tion then determines the amount of discount to be applied against current market value to obtain Wholesale" value, or so-called true cash value for property tax purposes. In each of these two areas, the timber of all owners is therefore valued on the same basis, as if they were all harvesting their merchantable timber reserves at the same rate. The net effect of this valuation procedure is this: The future in come to be derived from the harvest of timber on sustained yield operations like Weyerhaeus er's is not being converted to its true present worth. Instead, the sustained-yield operators harvest ing their timber reserves in order ly fashion over a long period of time receive less discount against current market values than they deserve by reason of their actual cutting practices. As a result. higher values than are Justified are placed on the timber reserves held by such operators. The net effect is to impose on sustained yield operations an inequitable and harsh tax burden. For Weyer haeuser, this tax burden alreadyiation. All other limber would be amounts, in one county, to asvaued at 30 ner cent of current much as 26 per cent of the valued ket value u the timber fc of the trees cut annually. The Oregon Slate Tax Commis sion has sought to revise the tim ber tax statutes to provide more equitable treatment for sustained yield operations and for those who are growing limber to maturity.1 The commission has submitted to the Interim Tax Study Committee I proposals to achieve these objectives. Proposals with similar, but not identical, objectives were present ed to the interim committee by the Industrial Forestry Associa tion and a committee of eastern Oregon pine operators. The interim committee did not adopt the Tax Commission's pro posal. Instead, it adopted with some reservations the Industrial Forestry Association proposal, and, without reservations, the eastern Oregon pine operators' proposal. These proposals will be recommended to the legislature! for consideration. The pine operator's proposal provides for a departure -trom the ad valorem property tax sys tem for timber. It would replace this with a severance tax system, a tax levied on timber when it is harvested. The forestland, itself, would continue to be taxed as it is at the present time. But the BY JAY HEAVILIN being harvested over a period of less than 30 years. In operations where merchantable timber is be ing harvested over a period of 30 years or longer, merchantable trees would be valued at 25 per cent of current market value. This 25 per cent valuation factor would be applied for 15 years only. Therealtcr the timber would! be valued at 30 per cent of cur rent market value. The Industrial Forestry Associ ation proposal has one more fea ture. Timber harvested each year would be valued for tax purposes Hat its full current market value. This feature was included in the proposal to offset any possible loss to the taxing districts of tim ber tax revenue loss that could otherwise occur under the pro posal because it exempts young, unmerchantable trees from taxa-l tion. It will soon become impossible to practice sustained yield, if the Around ond around the Inn walked Reynard, wandering what gift he might bring to the MwDom cnna in me manger. 1 EETs ESBtel ggjVry- 2jJiF 1 have not even o toil to givt to Hie u fjjt- "ii"nti.r''" precious Baby," ha thought. aTa Aj'visffiScy CLIMB ANTARCTIC PEAK " LONDON (UP1) - A British; naval officer and two Royal Mt' rines have become the first meg i to climb 9,565-foot Mt. Pagent fa! Antarctica, the admiralty an-" nounced Friday night. ' j Capt. V. N. Stevenson and Cpl. : Beverly Todd of the Marines and : Naval Lt. Cmdr. M. K. Burley ; reached the peak Tuesday. Jerry Phillips Hurt In Wreck TULELAKE Jerry Phillips, 22, is in Klamath Valley Hospital aft er a one-car crash, Friday night near.Tulelake. Night Officer O. E. Pederson, in reporting the accident, said young Phillips, driving at high speed up to an estimated 90 miles per hour, failed to make a turn near The Inn on State Highway 139 south of town, lost control and property tax system continues as ,. i. if vL .1.:. ..... f-ii. times.' Phillips was In the back seat it is. For this system fails to give enough consideration to the pro-1 longed growing cycle of timber, the deferred returns, and the long exposure to such risks as fire, insects, and disease factors in herent in timber ownership. at the time of rescue, his head through the rear window of the car. The car was demolished. No charges had been filed late Friday. timber would be taxed only at time of harvest. Provision was made in this proposal to raise an niiallv frnm timhpp the a fl m e amount of revenue for eastern jjj Oregon taxing districts as is be-'S ing raised under the present sys- S tern. Thus, there would be no I J shift in tax from timber to other y property. The Industrial Forestry Associ ation proposal would be applied to western Oregon only. Under this proposal, young unmerchantable timber would be exempt from tax- It t time to remember ... 5 K ft ft ft ft ft ft ft ft ft ft ft ft ill r OPEN NIGHT EVERY "Klamath's 721 Main SPARKLING CRYSTAL . FOR GIFTS! Use Your Charge Account At YOUR STORE Home Accessory And Gift Store" Phone TU 4-4561 $155,000 Asked For Education . SALEM (AP) A request for $155,000 to continue a program of education for children of migrant workers will be made to the 1961 legislature, Donald Petrie, state Department of Education offi cial, told the Oregon Conference on Migrant Labor meeting here Wednesday. Petrie headed the migrant la , bor pilot education program pro vided by the 1957 legislature. He said the sum requested would Be used to provide extra teachers and not for facilities or for capi tal outlay. Petrie said migrant children are from two to three years be hind in their schooling. Some 100 persons attended the conference. f Junk Salvager Gets High Honor CHATTANOOGA, Tenn. (AP) Mose and Garrison Siskin, who earned a fortune salvaging junk and used it to salvage people, have received the President's Dis tinguished Service Award for the Eccond time. The philanthropists are the only Individuals ever to receive the award twice. It is presented each year for the greatest national use ful employment of handicapped Americans. GIVE A GIFT OF NEW G-E i THE "CANTERBURY" STEREO HIGH-FIDELITY CONSOLE LOOK AT THESE FEATURES! 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