ASSESSING STORM DAMAGE
By Rick A. Lucas, CD Forester
Back on June 8th a storm hit Osceola County with such force that
it literally flattened thousands of trees occurring in its path. A
few days later, a team of National Weather Service meteorologists
from Grand Rapids confirmed that a tornado with peak winds
approaching 110 mph, corresponding to EF-1 damage on the Enhanced
Fujita Scale, occurred along an intermittent path approximately 5
miles long and up to .5 miles wide. The path extended from a mile
northeast of the village of Hersey into the Pere Marquette State
Forest several miles away and north of the city of Evart.
The good news is the tornado did the bulk of its damage in the
middle of a more remote part of the county away from any populated
areas. The bad news is it left behind a tangled mess occurring on
public and private lands that rendered the land both unusable and
unsafe. For the private forestlands caught in the path of
destruction, it will require some quick action and a lot of
decisions on behalf of its owner to assess the damage, arrange for
salvage operations and timber sales, minimize potential impacts of
other disasters after the storm, dealing with financial issues such
as income tax casualty losses, and altering management plans.
As soon as possible following such an event, a private landowner
will want to visit their property to assess the damage. The
assessment should include an inventory of the number, diameter and
species of tree damaged. Whether the majority of the trees are
uprooted, broken off or severely bent over. Part of the damage
assessment should focus on roads, fences and gates, stream crossings
and any other structures on the property. The access roads and its
infrastructure must be able to support 80,000 pound log trucks and
the accompanying logging equipment. Lastly, if possible, pictures
should be taken for use with claims relative to income tax casualty
losses and they prove to be very helpful for documenting
expenditures and repairs.
Once the assessment is complete a landowner will be in a better
position to determine whether they will need to consider a salvage
harvest or whether the forest has a sufficient number of healthy
trees to recover on its own. If it is determined that a salvage
harvest is necessary, landowners will want to plan a harvest as soon
as possible to best utilize the timber and redeem its value rather
than let it go to waste. The available salvage period varies
according to species and the expected product but generally should
not exceed 60-90 days.
Forest owners also need to be aware that broken and damaged
timber is no longer the same merchantable product as it was before a
storm. Also, the value of storm damaged timber will further decrease
with time for several reasons. Those reasons include staining or
fungi, wood borers and bark beetles, large volumes of wood put on
the market in a short period of time and individual markets
themselves, as well as higher harvesting costs associated with
damaged timber.
Timber salvage operations are more time consuming and dangerous
than regular harvesting, therefore the prices paid for damaged
timber will be lower than prices paid for standing timber. From a
logging point of view, it takes two to three times as long to
salvage one load of downed timber as it does to harvest a regular
load of logs.
Given the high demand for assistance in the coming months
following a storm, property size, and more importantly, timber
volume, will influence how much help you will be able to receive. It
will be very difficult, if not impossible, to have a small volume of
timber harvested. If a number of adjacent forest owners are willing
to work together to arrange for a salvage timber sale, then the
combined timber volume may enhance the chances for hiring logging
crews and receiving reasonable stumpage prices. Also, it may become
necessary to consider including the timber management needs from
unaffected parts of your property in order to attract a salvage
operation.
Claiming casualty loss deductions for income tax purposes is a
complicated matter. To be allowed as a casualty deduction, a loss to
your timber must be caused by natural or other external factors
acting in a sudden, unexpected and unusual manner. A sudden event is
one that is swift, not gradual or progressive. An unexpected event
is one that is ordinarily unanticipated and one that you do not
intend. Tornadoes generally fit those IRS definitions.
Unfortunately most timber casualty losses are limited to the
adjusted basis of the timber. The general rule is that the amount of
deductible loss is the lesser of the decrease in the fair market
value of the timber or the adjusted basis (minus any income received
from a salvation operation and/or any insurance proceeds). Several
other rules and conditions apply in order to claim a loss deduction.
I highly advise consulting a tax advisor or forester knowledgeable
in this area for further advice. It is also recommended that you
make sure you get documentation of the date of the casualty, the
location of the damage, property appraisals, and again, if possible,
photographs of the property before and after the disaster occurred.
Once you have dealt with damage assessment, salvage operations
and financial issues, the last important post- AT YOUR SERVICE
Continued from page 7. storm step will be to revisit and revise your
management plan to reflect the changes. Regeneration plans, harvest
schedules and activities to minimize future potential problems will
undoubtedly need to be reviewed and updated. Also, some activities
may be eligible for financial assistance that may become available.
If you do not have a current management plan, now may be a good time
to develop one as you deal with the changes before you.
Lastly, it may be a good time to make an appointment with a
public or private service forester to further assess the needs of
your property. Whether your standing timber is heavily damaged or
not, branches, leaves and broken tops will likely litter the forest
floor after a storm, and become potential fuel for a wildfire the
following spring. This situation, as well as stress impacts to
residual trees brought on by bark beetles and other causal agents
may be overlooked by the casual observer. Good planning is your best
defense!
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