Objective

To determine the extent of implementation of the two recommendations included in our initial audit report, Oversight of New York State Forest Tax Programs (Report 2020-S-51).

About the Program

New York State’s land area of 30.2 million acres comprises almost 19 million acres of forest, which provide many public benefits, including clean air and water, carbon storage, forest products (e.g., timber), jobs, scenic beauty, and outdoor recreation opportunities. Of the 19 million acres, about 14 million acres (74%) are privately owned. To encourage the long-term management of privately owned woodlands to sustainably produce forest crops and increase the likelihood of both healthy forests and a stable forest economy, in 1974, New York enacted Real Property Tax Law 480a – a tax incentive program (480a Program) for qualifying private forest landowners. The Department of Environmental Conservation (Department) has general oversight responsibility for the 480a Program, which is executed by its Central Office and 23 satellite sub-regional offices in seven of its nine regions.

The 480a Program is the second iteration of New York’s forest tax program. The 480 Program, also known as the Fisher Forest Act, dates back to 1926 – and the land management goals and requirements reflected the needs of the time. According to New York statewide parcel data, 795 properties, totaling 260,669 acres, remain committed (“grandfathered”) under the former program; these landowners have been benefiting from local tax reductions – and lesser qualifying standards – for over 45 years. While the requirements are less stringent, the former program required some Department oversight of the committed land.

The objective of our initial report, issued April 20, 2022, was to determine whether the Department was adequately monitoring the 480 and 480a private forest programs to ensure forest land is appropriately enrolled and landowners are adhering to requirements to assist in the protection of the environmental benefits of the State’s forest resources. Our audit covered tax exemptions granted under the 480 and 480a programs for the period January 2017 through December 2019 as well as observations and actions taken by the Department to monitor those properties through July 2021. The audit found monitoring and enforcement weaknesses in the Department’s oversight of the 480a Program that undermined its ability to ensure 480a Program forest lands continue to be protected and enhanced as an economic and environmental resource of major importance and that only eligible properties receive local tax exemptions. Additionally, while there are gaps in the law regarding oversight responsibility under the 480 Program, for the 795 properties spanning 260,669 acres, landowners had been benefiting from local tax reductions for over 45 years, but the properties were largely unmonitored by the Department or localities. In most cases, the Department was not aware which properties were enrolled in the 480 Program.

Key Findings

Department officials made progress in addressing the issues identified during the initial audit, partially implementing both of the initial report’s recommendations.

Key Recommendation

Officials are given 30 days after the issuance of this report to provide information on any actions planned to address the unresolved issues discussed in this follow-up.