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The Florida Forest Steward
A Quarterly Newsletter for Florida Landowners and Resource Professionals
Volume 8, No. 3
Estate Tax Update
Minimizing Losses from fusiform Rust.
Farm Bill Conservation Programs on the Line
Timber Tax Simplification Bill ..
Wildlife Plant Feature: Beautyberry
Ask Joe Steward
Timber Price Update
A University of Florida Cooperative Extension Service and Florida Division of Forestry joint project:
Chris Demers (editor), School of Forest Resources & Conservation, UF, P.O. Box 110410, Gainesville, FL
32611-0410, (352) 846-2375 or cdemers(a~gnv.ifas.ufl.edu
Alan Long (co-editor), School of Forest Resources & Conservation, UF, (352) 846-0891 or AJLLagnv.ifas.
Todd Groh (co-editor), Florida Division ofForestry, 3125 Conner Blvd, Tallahassee, FL 32699-1650, (850)
414-9907 or groht4itdoacs. state.fl.us
Chuck McKelvy (co-editor), Florida Fish and Wildlife Conservation Commission, 3125 Conner Blvd,
Tallahassee, FL 32699-1650, (850) 414-9911 or mckelvc(4afwc.state.fl.us
Estate Tax Update
Our Estate Planning for Forest Landowners workshop last June offered some very important
information for participants. Lyle Wolding, of Grower and Rancher Estate Tax Advisors,
presented helpful planning strategies for conserving the estate, prefaced by the latest news on the
estate tax. President Bush's Relief Act of 2001, or H.R. 1836, now signed into law, yielded limited
results with respect to the estate tax. H.R. 1836 gradually increases the unified credit exemption,
while reducing the top estate tax rate between 2002 and 2009, with a 12-month repeal of the estate
tax in 2010. That 12-month detail is important because this repeal "sunsets" on January 1, 2011, at
which time the top estate tax rate and unified credit revert back to today's tax law*, unless
congress re-repeals the tax by December 31, 2010.
Clearly, this temporary estate tax repeal could be costly for families that assume the repeal is
permanent. Unless you are certain that you will die in 2010, it is best to plan the transfer of your
estate according to current tax law. Provisions under the federal tax law allow landowners to
protect or "shelter" their assets from estate taxes by creating trusts and/or making tax-free gifts.
Talk to a financial advisor, tax law attorney or certified public accountant to explore your options.
This is perhaps the most important step you can take to secure the future of your property for your
children and grandchildren.
*On January 1, 2011, the top estate tax rate will revert back to 55% and the unified credit will
drop back to $675,000 or $1 million, a matter of law interpretation.
If you have Internet access go to www.house.gov/jct/x-50-01.pdf for a printable version of the
Joint Committee on Taxation's Comprehensive Summary of H.R. 1836, or call Chris Demers at
352-846-2375, cdemers(nyv. ifas.ufl.edu to have a copy mailed to you.
A/, UNIVERSITY OF
Cooperative Extension Service
Institute of Food and Agriculturel sciences
Minimizing Losses from Fusiform Rust:
Fusiform rust, a disease caused by a fungus (Cronartium quercuum f. sp. Fusiforme), has become
an epidemic in slash and loblolly pine plantations across the south since the early 1960s. Unlike
most pathogens, fusiform rust attacks healthy, rapidly growing trees instead of weakened trees,
creating a dilemma for managers seeking to boost the productivity of their plantations. The
increase in intensively managed plantations of loblolly and slash pines, the fungus' preferred pine
hosts, has created favorable conditions for extensive spread of the disease. However, knowledge
gained about the fungus and its life cycle has been used to develop strategies to minimize losses
Biology and Ecology
Fusiform rust is unique in that it cannot spread from pine to pine but rather passes to an alternate
host, red oaks, before infecting another pine. The fungus produces five types of spores during the
course of its life cycle two occur on pine stems and branches, the other three on the underside of
red oak leaves. The most important red oak hosts are water, laurel, willow, and southern red oak.
Cherrybark, bluejack, runner, and blackjack oaks are also important hosts on certain sites. Young
oak leaves are infected in the spring by wind-borne spores produced on pines, and new pine
leaders are infected later in the spring and summer by wind-bome spores from oak leaves. The
fungus requires no wounds on either host to establish. Once a pine is infected, the perennial
fungus causes a swelling, or gall, on the stem or branches, which often becomes infected by other
fungi and insects and eventually is weakened and deteriorated.
Site characteristics that favor high fusiform rust incidence are those that are associated with
abundant oaks well-drained soils with a sandy surface and organic horizon. Conversely, poorly
drained soils that do not support abundant oaks are less likely favorable for rust development.
Identification and Control
The disease can be identified by swellings on pine stems
or branches, where many yellow-orange fungus spores are
produced in the spring. Unfortunately, once a young stand
is infected with fusiform rust, there are few options
available to save the whole stand. The key to minimizing
losses is prevention, which starts with an assessment of -
the risk of rust incidence before plantation establishment.
Risk can be estimated by observing:
-the level of rust incidence in nearby young, planted
-the abundance of susceptible oaks in and around the site
to be planted;
-the soil type; and
-the growth potential of the site.
If these cannot be estimated from field observation try looking at a soil map. The drainage
category of the soil will give you some idea of its productivity and its capacity to support oaks.
Your county forester can help you interpret a soil map to determine your fusiform risk level and
he or she may know about the level of disease incidence within the county.
The most effective way to prevent rust in high and moderately high-risk areas is to plant rust-
resistant seedlings, which will reduce rust incidence by two-thirds. Note that not all genetically
improved seedlings are rust-resistant. Some seedlings are improved only for growth, which, if
planted on a high-risk site, will compound the rust problem. Rust-resistant seedlings cost more
than regular seedlings but will more than pay for themselves in the long run. It has been estimated
that $20 is returned to the landowner for every dollar invested in research on disease resistance2.
In addition to planting rust-resistant seedlings, these vegetation management techniques can
reduce oak growth as well as provide early competition control:
-chemical site preparation on previously forested sites that contain oaks,
-summer controlled burs discourage oak competition;
-KG blading, followed by disking, to reduce oak regrowth
If a stand becomes infected with fusiform rust, remove stem-infected trees and utilize them to the
extent possible. Galls formed within 12 inches of the main stem can grow into the stem, thus
timely pruning of limb galls from young infected trees can prevent further damage.
For more information about fusiform rust and other insect and disease problems, see the Florida
Forestry Information Web site linked at the top of this newsletter, or the Division of Forestry's
Insect and Diseases page at:
www.fl-dof.com/Pubs/Insects and Diseases/index.htm
1Schmidt, R.A. 1998. Fusiform rust disease of southern pines: biology, ecology and management.
Tech. Bull. 903. FL Coop. Ext. Serv., IFAS, University of Florida, Gainesville, FL.
2 Schmidt, R.A. 2001. Fusiform rust of southern pines: preventing and minimizing financial loss.
Forest Landowner 60(3):18-21.
Farm Bill Conservation Programs on the Line
The 1996 Farm Bill will expire next year and legislators are in the midst of hearings and debates
to determine how to rewrite the next version in the context of a significant tax cut. Among the
many subjects of debate, and of special concern to landowners in need of financial and technical
natural resource management assistance, is if and how to reformulate existing USDA cost-share
programs like the Conservation Reserve Program, Farmland Protection Program, Wetland
Reserve Program, Forestry Incentives Program, Wildlife Habitat Incentives Program, and
Environmental Quality Incentives Program.
Also on the table are some new conservation programs. The Sustainable Forestry Incentive
Program, a combined and enhanced version of the Forestry Incentives and Stewardship
Incentives Programs, would provide financial and technical assistance to landowners providing
public benefits such as recreation or wildlife habitat. In addition, the Program would increase
federal aid for tree planing, thinning, site preparation, and management plans. Another new
program, the Sustainable Forestry Outreach Initiative, would reauthorize and expand the
Renewable Resources Extension Act, designed to educate forest landowners about sustainable
forestry practices and the availability of professional natural resource management assistance.
The interests of private forest landowners are being represented in this process by the National
Council on Private Forests, a Washington DC-based group of representatives from several
natural resource management organizations including: the American Tree Farm System, National
Association of Professional Forestry Schools, Forest Landowners Association, Westvaco
Corporation, and the Society of American Foresters. Make your voice heard by contacting your
legislators. You can find the contact information for your legislators on-line at www.vote-smart.
iTimber Tax Simplification Bill
Private landowners who regularly sell timber are currently required to "retain an economic
interest" in their timber until it is sold in order to receive capital gains treatment on their income.
This means the seller must sell timber under contract terms that ensure that the seller bears all the
risk, and is only paid for timber as it is harvested. This method of payment, referred to as pay-as-
cut, can place a disproportionate burden on the seller because it may encourage fraud in the
scaling process and waste of timber resources by the buyer.
The Timber Simplification Act, proposed by both the U.S. Senate and House, may eliminate this
exclusive "retained economic interest" clause which would allow lump sum sales to also qualify
for capital gains treatment. The Joint Committee on Taxation has determined that this correction
would have negligible effect on federal revenue and the bills have the support of many groups,
including the Internal Revenue Service. The Forest Landowners Tax Council strongly favors the
Tax Simplification Bill because it will improve the economic viability of forest investments,
which will benefit the entire forest products industry and private landowners. Overall it will allow
harvest contracts to be based on sound forest management practices instead of the tax law.
For more information about this bill and its status, see the Forest Landowners Tax Council Web
site at www.fltc.org.
Wildlife Plant Feature: Beautyberry
This regular column will feature descriptions of plants that are important sources of wildlife food.
This issue's wildlife plant is beautyberry. Also known as French mulberry and beautybush,
beautyberry grows in a variety of environmental conditions across its range, from Texas to
Florida, north to Maryland and west to Oklahoma. It is an early successional plant, common
under open pine and oak canopies and along forest edges. Beautyberry persists, sometimes
increasing in abundance, after mechanical site preparation and burning, and it is spread by bird-
Form: bushy, deciduous shrub, 4-6 feet tall with
spreading branches, and grows in sparse
Leaves: deciduous, oval to lance-like, 3-7 inches
long, 1-4 inches wide, with coarsely serrate
margins and tapered base and tip; when crushed,
leaves have a very distinct unpleasant odor.
Flowers: June-July, dense clusters of 5-lobed,
pinkish-white flowers on short stalks.
Fruit: August-January, round purple berry Callicarpa americana
containing 4 seeds. Fruits are in characteristic, regularly spaced clusters encircling the stem.
Wildlife value: fruit are consumed by over 40 species of birds, deer, raccoons, opossums, and
several small rodents. Leaves are eaten by white-tailed deer when their preferred food is not
Miller, J.H. and K.V. Miller. 1999. Forest Plants of the Southeast and their Wildlife Uses.
Southern Weed Science Society. Champaign, Ill. 454 pp.
For more information on wildlife food plants see the reference above or the University of
Florida's 4-H Companion Plant page at: www.sfrc.ufl.edu/4h/Trees Plants/Plants/plants.html
Ask Joe Steward
Ask Joe Steward
Pines and Wildlife
An increasing number of landowners are interested in providing habitat for wildlife and
Stewardship biologists Leslie Hawkins and Wayne Harris work hard to help landowners manage
for game and nongame animals. This question is one that Leslie gets quite a bit.
Q: Which southern pine species is best for wildlife?
A: As you might have guessed, longleaf pine is superior to its relatives, slash and loblolly pines,
in terms of wildlife value and benefits. Longleaf pine produces larger, more nutritious seeds,
preferred by many birds and small mammals. In addition, its relatively open crown during
development and at maturity allows a variety of herbaceous browse to grow in the understory,
benefiting many wildlife species. Longleaf pine also has several adaptations that allow it to
tolerate and survive low intensity surface fires. These adaptations include: an interim stage of
development between the seedling and sapling stages known as the grass stage, which gives the
tree additional protection from fire; a terminal bud that remains near ground level for several
years; and long, dense, moisture-laden needles. Longleaf s adaptation to fire gives landowners a
unique opportunity to burn early in the rotation, which promotes an understory of succulent
grasses and forbs that are eaten by many animals.
Longleaf has these advantages but slash and loblolly pines are not without certain benefits to
wildlife as well. According to proceedings from a symposium on the managed slash pine
ecosystem, wetter sites, where slash pine is usually planted, have much less herbaceous seed
production than on the more upland sites where longleaf is often planted. However, these wetter
slash pine sites are home to abundant insects, which are food for a variety of birds, especially
winter migrants. With respect to loblolly, a quick glance at the crown of a loblolly pine usually
reveals hundreds of persistent cones that produce a great abundance of seeds on which many
birds feed in the spring. The bottom line for wildlife is active management. All planted pine
systems can provide wildlife benefits if managed properly periodic mowing and/or burning, and
a wildlife-friendly spacing should be considered when planting (i.e., 500 to 600 trees per acre, not
800-1000). In addition, longer rotations with multiple thinnings will also increase wildlife use
and productivity within these plantations.
Regardless of your preference, matching the correct species to the site is an essential first step
with any reforestation effort.
To Cut or Not to Cut
Southern pine beetle is a significant problem for many landowners again this year, especially in
the north-central part of the state, and they are faced with this question:
Q: Should I cut my trees that have been attacked by southern pine beetle?
A: Dr. John Foltz of the University of Florida Department of Entomology suggests that anyone
suspecting southern pine beetle immediately contact their county forester for an inspection and
recommendations. During outbreaks, beetles emerging from one infested tree have the potential
to attack and kill ten additional nearby trees. Like fire suppression during dry periods, quick
detection and quick action by all landowners is necessary to minimize tree mortality and the
economic losses. For additional information, see the Department of Entomology's Web site at
Timber Price Update-.,
Stumpage price ranges reported across /
Florida in the 2nd quarter 2001 Timber
Mart-South (TMS) report were: $17-$28/ 'E4^'kr' -
cord for pine pulpwood, $58-$84/cord
for pine C-N-S, $79-$102/cord for pine
sawtimber, and $94-$119/cord for pine
plylogs. On average, prices were down,
up, down, and the same for the four
products, respectively, compared to 1st
quarter 2000 prices. Hardwood
pulpwood prices ranged from $9-$15/
cord, which was up significantly from L- _. -_"
the previous quarter. A more complete summary of 2nd quarter 2001 stumpage prices is available
at your County Extension or County Forester's office.
Overall, not much has changed since the last quarter except for a fairly dramatic increase in
hardwood pulpwood stumpage prices. As was the case last year at this time, wildfire and southern
pine beetle salvage cuts are keeping the mills full of pine, but there is some apparent demand for
hardwood. Where the prices go next will depend on several factors: the weather, bugs, economy
and Canadian lumber imports.
Canadian Lumber Trade Update
March 31 marked the final day of the Canadian Softwood Lumber Agreement (SLA), signed in
1996 by the U.S. and Canada to restrict the import of lumber cut in British Columbia, Alberta,
Ontario and Quebec because of heavy industry subsidization by the Canadian Government in
those Provinces. In response to U.S Commerce Department concerns that the large supply of
lumber from Canadian imports will depress stumpage prices for U.S. producers, the Bush
Administration decided to impose a preliminary countervailing duty of 19.3% on Canadian
softwood lumber. Many believe the Commerce Department has largely underestimated the scale
of Canadian subsidies and that the duties should be higher to fully offset the effects of the
imports. Others argue that several tax provisions and programs benefit U.S. lumber producers,
leveling the "playing field" and thereby making trade restrictions with Canada unwarranted. In
particular, U.S. producers that sell timber to Canadian mills are against imposing such a tariff
because it will depress prices offered by Canadian mills. The preliminary duty took effect August
20, but it will not be finalized until the U.S. Trade Commission makes a final decision that
Canadian imported lumber is hurting the U.S. forest products industry, and the Commerce
Department must issue a final order for the tariff.