BILL REQ. #:  S-1058.3 

Read first time 02/04/2005.   Referred to Committee on Natural Resources, Ocean & Recreation.

     AN ACT Relating to forest practices as they affect family forest landowners; and amending RCW 76.09.010, 76.09.020, 76.09.040, 76.09.368, 76.09.410, 76.09.420, 76.09.440, 76.09.450, 77.12.755, 76.13.100, 76.13.110, 76.13.120, 76.13.140, 76.13.150, and 76.13.160.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1   RCW 76.09.010 and 1999 sp.s. c 4 s 901 are each amended to read as follows:
     (1) The legislature hereby finds and declares that the forest land resources are among the most valuable of all resources in the state; that a viable forest products industry is of prime importance to the state's economy; that it is in the public interest for public and private commercial forest lands to be managed consistent with sound policies of natural resource protection; that coincident with maintenance of a viable forest products industry, it is important to afford protection to forest soils, fisheries, wildlife, water quantity and quality, air quality, recreation, and scenic beauty.
     (2) The legislature further finds and declares it to be in the public interest of this state to create and maintain through the adoption of this chapter a comprehensive statewide system of laws and forest practices rules which will achieve the following purposes and policies:
     (a) Afford protection to, promote, foster and encourage timber growth, and require such minimum reforestation of commercial tree species on forest lands as will reasonably utilize the timber growing capacity of the soil following current timber harvest;
     (b) Afford protection to forest soils and public resources by utilizing all reasonable methods of technology in conducting forest practices;
     (c) Recognize both the public and private interest in the profitable growing and harvesting of timber;
     (d) Promote efficiency by permitting maximum operating freedom consistent with the other purposes and policies stated herein;
     (e) Provide for regulation of forest practices so as to avoid unnecessary duplication in such rules;
     (f) Provide for interagency input and intergovernmental and tribal coordination and cooperation;
     (g) Achieve compliance with all applicable requirements of federal and state law with respect to nonpoint sources of water pollution from forest practices;
     (h) To consider reasonable land use planning goals and concepts contained in local comprehensive plans and zoning regulations;
     (i) Foster cooperation among managers of public resources, forest landowners, Indian tribes and the citizens of the state; and
     (j) Develop a watershed analysis system that addresses the cumulative effect of forest practices on, at a minimum, the public resources of fish, water, and public capital improvements of the state and its political subdivisions.
     (3) The legislature further finds and declares that it is also in the public interest of the state to encourage forest landowners to undertake corrective and remedial action to reduce the impact of mass earth movements and fluvial processes.
     (4) The legislature further finds and declares that it is in the public interest that the applicants for state forest practices permits should assist in paying for the cost of review and permitting necessary for the environmental protection of these resources.
     (5) The legislature further finds and declares that:
     (a) The long-term stewardship that is provided by family forest landowners in urban growth areas and rural areas is important for maintaining the evergreen state's special character and quality of life and provides citizens living in the urban/rural interface with an important buffer that provides aesthetic values at minimal cost to the taxpayers;
     (b) Many family forest landowners live and raise their families on their forest land, or otherwise foster intergenerational involvement, creating an emotional attachment to and love for the land that increases the likelihood of continued ownership and management of family forests by future generations;
     (c) Many family forests are characterized by a "light touch on the land." This includes: Species diversity; low-impact harvesting; small harvest openings and long stand rotations with multiple thinning entries; and a variety of nontimber management objectives that benefit the public;
     (d) Family forest landowners provide: Family wage jobs to their local communities; a reliable tax base to their counties, generally utilizing fewer public services than taxes paid; and a way of life integral to rural communities;
     (e) Family forest lands provide significant benefits to the economic and environmental well-being of Washington's citizens, including: Clean air and water; habitat for a broad array of fish, wildlife, and plant species, including some threatened and endangered species; and a variety of renewable natural resource products;
     (f) If these lands were to be converted to nonforestry uses, these benefits would be lost to future generations as well as current generations of citizens;
     (g) Current forest practices rules and other administrative regulations and complexity pose significant challenges to the continued ownership and management of family forests, creating a disincentive to their continued management as forest lands and are among the causes of their conversion to nonforest land uses;
     (h) It is in the best interests of the citizens of the state of Washington and the environment that legislation and rules be developed and implemented that will encourage family forest ownership and long-term management planning; and
     (i) It is also in the best interests of the citizens of the state of Washington and the environment that family forest landowners and the state of Washington are given the opportunity to enter into long-term management plans that will provide enhanced flexibility and secure the many benefits of forest land management for current and future generations of Washington citizens.

Sec. 2   RCW 76.09.020 and 2003 c 311 s 3 are each amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Adaptive management" means reliance on scientific methods to test the results of actions taken so that the management and related policy can be changed promptly and appropriately.
     (2) "Appeals board" means the forest practices appeals board created by RCW 76.09.210.
     (3) "Aquatic resources" includes water quality, salmon, other species of the vertebrate classes Cephalaspidomorphi and Osteichthyes identified in the forests and fish report, the Columbia torrent salamander (Rhyacotriton kezeri), the Cascade torrent salamander (Rhyacotriton cascadae), the Olympic torrent salamander (Rhyacotriton olympian), the Dunn's salamander (Plethodon dunni), the Van Dyke's salamander (Plethodon vandyke), the tailed frog (Ascaphus truei), and their respective habitats.
     (4) "Commissioner" means the commissioner of public lands.
     (5) "Contiguous" means land adjoining or touching by common corner or otherwise. Land having common ownership divided by a road or other right of way shall be considered contiguous.
     (6) "Conversion to a use other than commercial timber operation" means a bona fide conversion to an active use which is incompatible with timber growing and as may be defined by forest practices rules.
     (7) "Department" means the department of natural resources.
     (8) "Fish passage barrier" means any artificial instream structure that impedes the free passage of fish.
     (9) "Forest land" means all land which is capable of supporting a merchantable stand of timber and is not being actively used for a use which is incompatible with timber growing. Forest land does not include agricultural land that is or was enrolled in the conservation reserve enhancement program by contract if such agricultural land was historically used for agricultural purposes and the landowner intends to continue to use the land for agricultural purposes in the future. As it applies to the operation of the road maintenance and abandonment plan element of the forest practices rules on ((small)) family forest landowners, the term "forest land" excludes:
     (a) Residential home sites, which may include up to five acres; and
     (b) Cropfields, orchards, vineyards, pastures, feedlots, fish pens, and the land on which appurtenances necessary to the production, preparation, or sale of crops, fruit, dairy products, fish, and livestock exist.
     (10) "Forest landowner" means any person in actual control of forest land, whether such control is based either on legal or equitable title, or on any other interest entitling the holder to sell or otherwise dispose of any or all of the timber on such land in any manner. However, any lessee or other person in possession of forest land without legal or equitable title to such land shall be excluded from the definition of "forest landowner" unless such lessee or other person has the right to sell or otherwise dispose of any or all of the timber located on such forest land.
     (11) "Forest practice" means any activity conducted on or directly pertaining to forest land and relating to growing, harvesting, or processing timber, including but not limited to:
     (a) Road and trail construction;
     (b) Harvesting, final and intermediate;
     (c) Precommercial thinning;
     (d) Reforestation;
     (e) Fertilization;
     (f) Prevention and suppression of diseases and insects;
     (g) Salvage of trees; and
     (h) Brush control.
"Forest practice" shall not include preparatory work such as tree marking, surveying and road flagging, and removal or harvesting of incidental vegetation from forest lands such as berries, ferns, greenery, mistletoe, herbs, mushrooms, and other products which cannot normally be expected to result in damage to forest soils, timber, or public resources.
     (12) "Forest practices rules" means any rules adopted pursuant to RCW 76.09.040.
     (13) "Forest road," as it applies to the operation of the road maintenance and abandonment plan element of the forest practices rules on ((small)) family forest landowners, means a road or road segment that crosses land that meets the definition of forest land, but excludes residential access roads.
     (14) "Forest trees" does not include hardwood trees cultivated by agricultural methods in growing cycles shorter than fifteen years if the trees were planted on land that was not in forest use immediately before the trees were planted and before the land was prepared for planting the trees. "Forest trees" includes Christmas trees, but does not include Christmas trees that are cultivated by agricultural methods, as that term is defined in RCW 84.33.035.
     (15) "Forests and fish report" means the forests and fish report to the board dated April 29, 1999.
     (16) "Application" means the application required pursuant to RCW 76.09.050.
     (17) "Operator" means any person engaging in forest practices except an employee with wages as his or her sole compensation.
     (18) "Person" means any individual, partnership, private, public, or municipal corporation, county, the department or other state or local governmental entity, or association of individuals of whatever nature.
     (19) "Public resources" means water, fish and wildlife, and in addition shall mean capital improvements of the state or its political subdivisions.
     (20) "((Small)) Family forest landowner" has the same meaning as defined in RCW 76.09.450.
     (21) "Timber" means forest trees, standing or down, of a commercial species, including Christmas trees. However, "timber" does not include Christmas trees that are cultivated by agricultural methods, as that term is defined in RCW 84.33.035.
     (22) "Timber owner" means any person having all or any part of the legal interest in timber. Where such timber is subject to a contract of sale, "timber owner" shall mean the contract purchaser.
     (23) "Board" means the forest practices board created in RCW 76.09.030.
     (24) "Unconfined avulsing channel migration zone" means the area within which the active channel of an unconfined avulsing stream is prone to move and where the movement would result in a potential near-term loss of riparian forest adjacent to the stream. Sizeable islands with productive timber may exist within the zone.
     (25) "Unconfined avulsing stream" means generally fifth order or larger waters that experience abrupt shifts in channel location, creating a complex flood plain characterized by extensive gravel bars, disturbance species of vegetation of variable age, numerous side channels, wall-based channels, oxbow lakes, and wetland complexes. Many of these streams have dikes and levees that may temporarily or permanently restrict channel movement.

Sec. 3   RCW 76.09.040 and 2000 c 11 s 3 are each amended to read as follows:
     (1) Where necessary to accomplish the purposes and policies stated in RCW 76.09.010, and to implement the provisions of this chapter, the board shall adopt forest practices rules pursuant to chapter 34.05 RCW and in accordance with the procedures enumerated in this section that:
     (a) Establish minimum standards for forest practices;
     (b) Provide procedures for the voluntary development of resource management plans which may be adopted as an alternative to the minimum standards in (a) of this subsection if the plan is consistent with the purposes and policies stated in RCW 76.09.010 and the plan meets or exceeds the objectives of the minimum standards;
     (c) Set forth necessary administrative provisions;
     (d) Establish procedures for the collection and administration of forest practice fees as set forth by this chapter; and
     (e) Allow for the development of watershed analyses.
     Forest practices rules pertaining to water quality protection shall be adopted by the board after reaching agreement with the director of the department of ecology or the director's designee on the board with respect thereto. All other forest practices rules shall be adopted by the board.
     Forest practices rules shall be administered and enforced by either the department or the local governmental entity as provided in this chapter. Such rules shall be adopted and administered so as to give consideration to all purposes and policies set forth in RCW 76.09.010.
     (2) The board shall prepare proposed forest practices rules. In addition to any forest practices rules relating to water quality protection proposed by the board, the department of ecology may submit to the board proposed forest practices rules relating to water quality protection.
     Prior to initiating the rule making process, the proposed rules shall be submitted for review and comments to the department of fish and wildlife and to the counties of the state. After receipt of the proposed forest practices rules, the department of fish and wildlife and the counties of the state shall have thirty days in which to review and submit comments to the board, and to the department of ecology with respect to its proposed rules relating to water quality protection. After the expiration of such thirty day period the board and the department of ecology shall jointly hold one or more hearings on the proposed rules pursuant to chapter 34.05 RCW. At such hearing(s) any county may propose specific forest practices rules relating to problems existing within such county. The board may adopt and the department of ecology may approve such proposals if they find the proposals are consistent with the purposes and policies of this chapter.
     (3) The board, when adopting rules, shall consider how to accomplish the intent of the new rules while encouraging continued family forest land ownership and management.
     (4) The legislature has given the board authority to implement long-term management plans as forest practice applications through alternate plans and other means for family forest landowners. The needs of family forest landowners for longer term approval of management plans are not being met as the legislature intended. The board shall work with the department, the small forest landowner advisory committee, and other stakeholders to expeditiously authorize approval of long-term plans for family forest landowners.
     (5) The board shall explore other family forest issues, such as a reasonable use exception, continued conversion pressures, and regulatory incentives. The board shall report to the commissioner of public lands, the governor, and the legislature on its progress in addressing these and other family forest issues by June 30th of each odd-numbered year.
     (6) The board shall establish by rule a riparian open space program that includes acquisition of a fee interest in, or at the landowner's option, a conservation easement on lands within unconfined avulsing channel migration zones. Once acquired, these lands may be held and managed by the department, transferred to another state agency, transferred to an appropriate local government agency, or transferred to a private nonprofit nature conservancy corporation, as defined in RCW 64.04.130, in fee or transfer of management obligation. The board shall adopt rules governing the acquisition by the state or donation to the state of such interest in lands including the right of refusal if the lands are subject to unacceptable liabilities. The rules shall include definitions of qualifying lands, priorities for acquisition, and provide for the opportunity to transfer such lands with limited warranties and with a description of boundaries that does not require full surveys where the cost of securing the surveys would be unreasonable in relation to the value of the lands conveyed. The rules shall provide for the management of the lands for ecological protection or fisheries enhancement. Because there are few, if any, comparable sales of forest land within unconfined avulsing channel migration zones, separate from the other lands or assets, these lands are likely to be extraordinarily difficult to appraise and the cost of a conventional appraisal often would be unreasonable in relation to the value of the land involved. Therefore, for the purposes of voluntary sales under this section, the legislature declares that these lands are presumed to have a value equal to: (a) The acreage in the sale multiplied by the average value of commercial forest land in the region under the land value tables used for property tax purposes under RCW ((84.33.120)) 84.33.140; plus (b) the cruised volume of any timber located within the channel migration multiplied by the appropriate quality code stumpage value for timber of the same species shown on the appropriate table used for timber harvest excise tax purposes under RCW 84.33.091. For purposes of this section, there shall be an eastside region and a westside region as defined in the forests and fish report as defined in RCW 76.09.020.
     (((4))) (7) Subject to appropriations sufficient to cover the cost of such an acquisition program and the related costs of administering the program, the department is directed to purchase a fee interest or, at the owner's option, a conservation easement in land that an owner tenders for purchase; provided that such lands have been taxed as forest lands and are located within an unconfined avulsing channel migration zone. Lands acquired under this section shall become riparian open space. These acquisitions shall not be deemed to trigger the compensating tax of chapters 84.33 and 84.34 RCW.
     (((5))) (8) Instead of offering to sell interests in qualifying lands, owners may elect to donate the interests to the state.
     (((6))) (9) Any acquired interest in qualifying lands by the state under this section shall be managed as riparian open space.

Sec. 4   RCW 76.09.368 and 2002 c 120 s 4 are each amended to read as follows:
     The legislature intends that ((small)) family forest landowners have access to alternate plan processes or alternate harvest restrictions, or both if necessary, that meet the public resource protection standard set forth in RCW 76.09.370(3), but which also lowers the overall cost of regulation to ((small)) family forest landowners including, but not limited to, timber value forgone, layout costs, and operating costs. The forest practices board shall consult with the small forest landowner office advisory committee in developing these alternate approaches. By July 1, 2003, the forest practices board shall provide the legislature with a written report that describes the board's progress in developing alternate plan processes or alternate harvest restrictions, or both if necessary, that meet legislative intent.
     As used in this section, "((small)) family forest landowner" has the same meaning as defined in RCW ((76.13.120(2))) 76.09.450.

Sec. 5   RCW 76.09.410 and 2003 c 311 s 2 are each amended to read as follows:
     (1) The state may not require a ((small)) family forest landowner to invest in upgrades, replacements, or other engineering of a forest road, and any fish passage barriers that are a part of the road, that do not threaten public resources or create a barrier to the passage of fish.
     (2) Participation in the forests and fish agreement provides a benefit to both the landowner in terms of federal assurances, and the public in terms of aquatic habitat preservation and water quality enhancement; therefore, if conditions do threaten public resources or create a fish passage barrier, the road maintenance and abandonment planning process may not require a ((small)) family forest landowner to take a positive action that will result in high cost without a significant portion of that cost being shared by the public.
     (3) Some fish passage barriers are more of a threat to public resources than others; therefore, no ((small)) family forest landowner should be required to repair a fish passage barrier until higher priority fish passage barriers on other lands in the watershed have been repaired.
     (4) If an existing fish passage barrier on land owned by a ((small)) family forest landowner was installed under an approved forest practices application or notification, and hydraulics approval, and that fish passage barrier becomes a high priority for fish passage based on the watershed ranking in RCW ((76.13.150)) 77.12.755, one hundred percent public funding shall be provided.
     (5) The preparation of a road maintenance and abandonment plan can require technical expertise that may require large expenditures before the time that the landowner plans to conduct any revenue-generating operations on his or her land; therefore, ((small)) family forest landowners should be allowed to complete a simplified road maintenance and abandonment plan checklist, that does not require professional engineering or forestry expertise to complete, and that does not need to be submitted until the time that the landowner submits a forest practices application or notification for final or intermediate harvesting, or for salvage of trees. Chapter 311, Laws of 2003 is intended to provide an alternate way for ((small)) family forest landowners to comply with the road maintenance and abandonment plan goals identified in the forest practices rules.

Sec. 6   RCW 76.09.420 and 2003 c 311 s 4 are each amended to read as follows:
     (1) The board must amend the forest practices rules relating to road maintenance and abandonment plans that exist on May 14, 2003, to reflect the following:
     (a) A forest landowner who owns a total of eighty acres or less of forest land in Washington is not required to submit a road maintenance and abandonment plan for any block of forest land that is twenty contiguous acres or less in area;
     (b) A landowner who satisfies the definition of a ((small)) family forest landowner, but who does not qualify under (a) of this subsection, is only required to submit a checklist road maintenance and abandonment plan with the abbreviated content requirements provided for in subsection (3) of this section, and is not required to comply with annual reporting and review requirements; and
     (c) Existing forest roads must be maintained only to the extent necessary to prevent damage to public resources.
     (2) The department must provide a landowner who is either exempted from submitting a road maintenance and abandonment plan under subsection (1)(a) of this section, or who qualifies for a checklist road maintenance and abandonment plan under subsection (1)(b) of this section, with an educational brochure outlining road maintenance standards and requirements. In addition, the department must develop a series of nonmandatory educational workshops on the rules associated with road construction and maintenance.
     (3)(a) A landowner who qualifies for a checklist road maintenance and abandonment plan under subsection (1)(b) of this section is only required to submit a checklist, designed by the department in consultation with the small forest landowner office advisory committee created in RCW 76.13.110, that confirms that the landowner is applying the checklist criteria to forest roads covered or affected by a forest practices application or notification. When developing the checklist road maintenance and abandonment plan, the department shall ensure that the checklist does not exceed current state law. Nothing in this subsection increases or adds to ((small)) family forest landowners' duties or responsibilities under any other section of the forest practices rules or any other state law or rule.
     (b) A landowner who qualifies for the checklist road maintenance and abandonment plan is not required to submit the checklist before the time that he or she submits a forest practices application or notification for final or intermediate harvesting, or for salvage of trees. The department may encourage and accept checklists prior to the time that they are due.
     (4) The department must monitor the extent of the checklist road maintenance and abandonment plan approach and report its findings to the appropriate committees of the legislature by December 31, 2008, and December 31, 2013.
     (5) The board shall adopt emergency rules under RCW 34.05.090 by October 31, 2003, to implement this section. The emergency rules shall remain in effect until permanent rules can be adopted. The forest practices rules that relate to road maintenance and abandonment plans shall remain in effect as they existed on May 14, 2003, until emergency rules have been adopted under this section.
     (6) This section is only intended to relate to the board's duties as they relate to the road maintenance and abandonment plan element of the forests and fish report. Nothing in this section alters any forest landowner's duties and responsibilities under any other section of the forest practices rules, or any other state law or rule.

Sec. 7   RCW 76.09.440 and 2003 c 311 s 9 are each amended to read as follows:
     The department shall not disapprove a forest practices application filed by a ((small)) family forest landowner on the basis that fish passage barriers have not been removed or replaced if the ((small)) family forest landowner filing the application has committed to participate in the program established in RCW 76.13.150 for all fish passage barriers existing on the block of forest land covered by the forest practices application, and the fish passage barriers existing on the block of forest land covered by the forest practices application are lower on the funding order list established for the program than the current projects that are capable of being funded by the program.

Sec. 8   RCW 76.09.450 and 2003 c 311 s 11 are each amended to read as follows:
     For the purposes of this chapter and RCW 76.13.150 and 77.12.755, "((small)) family forest landowner" means ((an owner of forest land)) a forest landowner, except any publicly held corporation, governmental entity, nonprofit organization, or public utility, who, at the time of submission of required documentation to the department, has harvested from his or her own lands in this state no more than an average timber volume of two million board feet per year during the three years prior to submitting documentation to the department and who certifies that he or she does not expect to harvest from his or her own lands in the state more than an average timber volume of two million board feet per year during the ten years following the submission of documentation to the department. However, any landowner who exceeded the two million board feet annual average timber harvest threshold from their land in the three years prior to submitting documentation to the department, or who expects to exceed the threshold during any of the following ten years, shall still be deemed a "((small)) family forest landowner" if he or she establishes to the department's reasonable satisfaction that the harvest limits were, or will be, exceeded in order to raise funds to pay estate taxes or for an equally compelling and unexpected obligation, such as for a court-ordered judgment or for extraordinary medical expenses.

Sec. 9   RCW 77.12.755 and 2003 c 311 s 10 are each amended to read as follows:
     In coordination with the department of natural resources and lead entity groups, the department must establish a ranked inventory of fish passage barriers on land owned by ((small)) family forest landowners based on the principle of fixing the worst first within a watershed consistent with the fish passage priorities of the forest and fish report. The department shall first gather and synthesize all available existing information about the locations and impacts of fish passage barriers in Washington. This information must include, but not be limited to, the most recently available limiting factors analysis conducted pursuant to RCW 77.85.060(2), the stock status information contained in the department of fish and wildlife salmonid stock inventory (SASSI), the salmon and steelhead habitat inventory and assessment project (SSHIAP), and any comparable science-based assessment when available. The inventory of fish passage barriers must be kept current and at a minimum be updated by the beginning of each calendar year. Nothing in this section grants the department or others additional right of entry onto private property.

Sec. 10   RCW 76.13.100 and 2003 c 39 s 36 are each amended to read as follows:
     (1) The legislature finds that increasing regulatory requirements continue to diminish the economic viability of ((small)) family forest landowners. The concerns set forth in RCW 77.85.180 about the importance of sustaining forestry as a viable land use are particularly applicable to ((small)) family landowners because of the location of their holdings, the expected complexity of the regulatory requirements, and the need for significant technical expertise not readily available to small landowners. The further reduction in harvestable timber owned by ((small)) family forest landowners as a result of the rules to be adopted under RCW 76.09.055 will further erode ((small)) family landowners' economic viability and willingness or ability to keep the lands in forestry use and, therefore, reduce the amount of habitat available for salmon recovery and conservation of other aquatic resources, as defined in RCW 76.09.020.
     (2) The legislature finds that the concerns identified in subsection (1) of this section should be addressed by establishing within the department of natural resources a small forest landowner office that shall be a resource and focal point for ((small)) family forest landowner concerns and policies. The legislature further finds that a forestry riparian easement program shall be established to acquire easements from ((small)) family landowners along riparian and other areas of value to the state for protection of aquatic resources. The legislature further finds that ((small)) family forest landowners should have the option of alternate management plans or alternate harvest restrictions on smaller harvest units that may have a relatively low impact on aquatic resources. The small forest landowner office should be responsible for assisting ((small)) family landowners in the development and implementation of these plans or restrictions.

Sec. 11   RCW 76.13.110 and 2002 c 120 s 1 are each amended to read as follows:
     (1) The department of natural resources shall establish and maintain a small forest landowner office. The small forest landowner office shall be a resource and focal point for ((small)) family forest landowner concerns and policies, and shall have significant expertise regarding the management of small forest holdings, governmental programs applicable to such holdings, and the forestry riparian easement program.
     (2) The small forest landowner office shall administer the provisions of the forestry riparian easement program created under RCW 76.13.120.
     (3) The small forest landowner office shall assist in the development of ((small)) family landowner options through alternate management plans or alternate harvest restrictions appropriate to ((small)) family landowners. The small forest landowner office shall develop criteria to be adopted by the forest practices board in rules and a manual for alternate management plans or alternate harvest restrictions. These alternate plans or alternate harvest restrictions shall meet riparian functions while requiring less costly regulatory prescriptions. At the landowner's option, alternate plans or alternate harvest restrictions may be used to further meet riparian functions.
     The small forest landowner office shall evaluate the cumulative impact of such alternate management plans or alternate harvest restrictions on essential riparian functions at the subbasin or watershed level. The small forest landowner office shall adjust future alternate management plans or alternate harvest restrictions in a manner that will minimize the negative impacts on essential riparian functions within a subbasin or watershed.
     (4) An advisory committee is established to assist the small forest landowner office in developing policy and recommending rules to the forest practices board. The advisory committee shall consist of seven members, including a representative from the department of ecology, the department of fish and wildlife, and a tribal representative. Four additional committee members shall be ((small)) family forest landowners who shall be appointed by the commissioner of public lands from a list of candidates submitted by the board of directors of the Washington farm forestry association or its successor organization. The association shall submit more than one candidate for each position. The commissioner shall designate two of the initial ((small)) family forest landowner appointees to serve five-year terms and the other two ((small)) family forest landowner appointees to serve four-year terms. Thereafter, appointees shall serve for a term of four years. The small forest landowner office shall review draft rules or rule concepts with the committee prior to recommending such rules to the forest practices board. The office shall reimburse nongovernmental committee members for reasonable expenses associated with attending committee meetings as provided in RCW 43.03.050 and 43.03.060.
     (5) By December 1, 2002, the small forest landowner office shall provide a report to the board and the legislature containing:
     (a) Estimates of the amounts of nonindustrial forests and woodlands in holdings of twenty acres or less, twenty-one to one hundred acres, one hundred to one thousand acres, and one thousand to five thousand acres, in western Washington and eastern Washington, and the number of persons having total nonindustrial forest and woodland holdings in those size ranges;
     (b) Estimates of the number of parcels of nonindustrial forests and woodlands held in contiguous ownerships of twenty acres or less, and the percentages of those parcels containing improvements used: (i) As primary residences for half or more of most years; (ii) as vacation homes or other temporary residences for less than half of most years; and (iii) for other uses;
     (c) The watershed administrative units in which significant portions of the riparian areas or total land area are nonindustrial forests and woodlands;
     (d) Estimates of the number of forest practices applications and notifications filed per year for forest road construction, silvicultural activities to enhance timber growth, timber harvest not associated with conversion to nonforest land uses, with estimates of the number of acres of nonindustrial forests and woodlands on which forest practices are conducted under those applications and notifications; and
     (e) Recommendations on ways the board and the legislature could provide more effective incentives to encourage continued management of nonindustrial forests and woodlands for forestry uses in ways that better protect salmon, other fish and wildlife, water quality, and other environmental values.
     (6) By December 1, 2004, and every four years thereafter, the small forest landowner office shall provide to the board and the legislature an update of the report described in subsection (5) of this section, containing more recent information and describing:
     (a) Trends in the items estimated under subsection (5)(a) through (d) of this section;
     (b) Whether, how, and to what extent the forest practices act and rules contributed to those trends; and
     (c) Whether, how, and to what extent: (i) The board and legislature implemented recommendations made in the previous report; and (ii) implementation of or failure to implement those recommendations affected those trends.

Sec. 12   RCW 76.13.120 and 2004 c 102 s 1 are each amended to read as follows:
     (1) The legislature finds that the state should acquire easements along riparian and other sensitive aquatic areas from ((small)) family forest landowners willing to sell or donate such easements to the state provided that the state will not be required to acquire such easements if they are subject to unacceptable liabilities. The legislature therefore establishes a forestry riparian easement program.
     (2) The definitions in this subsection apply throughout this section and RCW 76.13.100 and 76.13.110 unless the context clearly requires otherwise.
     (a) "Forestry riparian easement" means an easement covering qualifying timber granted voluntarily to the state by a ((small)) family forest landowner.
     (b) "Qualifying timber" means those trees covered by a forest practices application that the ((small)) family forest landowner is required to leave unharvested under the rules adopted under RCW 76.09.055 and 76.09.370 or that is made uneconomic to harvest by those rules, and for which the ((small)) family landowner is willing to grant the state a forestry riparian easement. "Qualifying timber" is timber within or bordering a commercially reasonable harvest unit as determined under rules adopted by the forest practices board, or timber for which an approved forest practices application for timber harvest cannot be obtained because of restrictions under the forest practices rules.
     (c) "((Small)) Family forest landowner" means a landowner meeting all of the following characteristics: (i) A forest landowner as defined in RCW 76.09.020 whose interest in the land and timber is in fee or who has rights to the timber to be included in the forestry riparian easement that extend at least fifty years from the date the forest practices application associated with the easement is submitted; (ii) an entity that has harvested from its own lands in this state during the three years prior to the year of application an average timber volume that would qualify the owner as a small harvester under RCW 84.33.035; and (iii) an entity that certifies at the time of application that it does not expect to harvest from its own lands more than the volume allowed by RCW 84.33.035 during the ten years following application. If a landowner's prior three-year average harvest exceeds the limit of RCW 84.33.035, or the landowner expects to exceed this limit during the ten years following application, and that landowner establishes to the department of natural resources' reasonable satisfaction that the harvest limits were or will be exceeded to raise funds to pay estate taxes or equally compelling and unexpected obligations such as court-ordered judgments or extraordinary medical expenses, the landowner shall be deemed to be a ((small)) family forest landowner.
     For purposes of determining whether a person qualifies as a ((small)) family forest landowner, the small forest landowner office, created in RCW 76.13.110, shall evaluate the landowner under this definition, pursuant to RCW 76.13.160, as of the date that the forest practices application is submitted or the date the landowner notifies the department that the harvest is to begin with which the forestry riparian easement is associated. ((A small forest landowner can include an individual, partnership, corporate, or other nongovernmental legal entity.)) If a landowner grants timber rights to another entity for less than five years, the landowner may still qualify as a ((small)) family forest landowner under this section. If a landowner is unable to obtain an approved forest practices application for timber harvest for any of his or her land because of restrictions under the forest practices rules, the landowner may still qualify as a ((small)) family forest landowner under this section.
     (d) "Completion of harvest" means that the trees have been harvested from an area and that further entry into that area by mechanized logging or slash treating equipment is not expected.
     (3) The department of natural resources is authorized and directed to accept and hold in the name of the state of Washington forestry riparian easements granted by ((small)) family forest landowners covering qualifying timber and to pay compensation to such landowners in accordance with subsections (6) and (7) of this section. The department of natural resources may not transfer the easements to any entity other than another state agency.
     (4) Forestry riparian easements shall be effective for fifty years from the date the forest practices application associated with the qualifying timber is submitted to the department of natural resources, unless the easement is terminated earlier by the department of natural resources voluntarily, based on a determination that termination is in the best interest of the state, or under the terms of a termination clause in the easement.
     (5) Forestry riparian easements shall be restrictive only, and shall preserve all lawful uses of the easement premises by the landowner that are consistent with the terms of the easement and the requirement to protect riparian functions during the term of the easement, subject to the restriction that the leave trees required by the rules to be left on the easement premises may not be cut during the term of the easement. No right of public access to or across, or any public use of the easement premises is created by this statute or by the easement. Forestry riparian easements shall not be deemed to trigger the compensating tax of or otherwise disqualify land from being taxed under chapter 84.33 or 84.34 RCW.
     (6) Upon application of a ((small)) family forest landowner for a riparian easement that is associated with a forest practices application and the landowner's marking of the qualifying timber on the qualifying lands, the small forest landowner office shall determine the compensation to be offered to the ((small)) family forest landowner as provided for in this section. The small forest landowner office shall also determine the compensation to be offered to a ((small)) family forest landowner for qualifying timber for which an approved forest practices application for timber harvest cannot be obtained because of restrictions under the forest practices rules. The legislature recognizes that there is not readily available market transaction evidence of value for easements of this nature, and thus establishes the following methodology to ascertain the value for forestry riparian easements. Values so determined shall not be considered competent evidence of value for any other purpose.
     The small forest landowner office shall establish the volume of the qualifying timber. Based on that volume and using data obtained or maintained by the department of revenue under RCW 84.33.074 and 84.33.091, the small forest landowner office shall attempt to determine the fair market value of the qualifying timber as of the date the forest practices application associated with the qualifying timber was submitted or the date the landowner notifies the department that the harvest is to begin. Removal of any qualifying timber before the expiration of the easement must be in accordance with the forest practices rules and the terms of the easement. There shall be no reduction in compensation for reentry.
     (7) Except as provided in subsection (8) of this section, the small forest landowner office shall, subject to available funding, offer compensation to the ((small)) family forest landowner in the amount of fifty percent of the value determined in subsection (6) of this section, plus the compliance and reimbursement costs as determined in accordance with RCW 76.13.140. If the landowner accepts the offer for qualifying timber that will be harvested pursuant to an approved forest practices application, the department of natural resources shall pay the compensation promptly upon (a) completion of harvest in the area covered by the forestry riparian easement; (b) verification that there has been compliance with the rules requiring leave trees in the easement area; and (c) execution and delivery of the easement to the department of natural resources. If the landowner accepts the offer for qualifying timber for which an approved forest practices application for timber harvest cannot be obtained because of restrictions under the forest practices rules, the department of natural resources shall pay the compensation promptly upon (i) verification that there has been compliance with the rules requiring leave trees in the easement area; and (ii) execution and delivery of the easement to the department of natural resources. Upon donation or payment of compensation, the department of natural resources may record the easement.
     (8) For approved forest practices applications where the regulatory impact is greater than the average percentage impact for all ((small)) family landowners as determined by the department of natural resources analysis under the regulatory fairness act, chapter 19.85 RCW, the compensation offered will be increased to one hundred percent for that portion of the regulatory impact that is in excess of the average. Regulatory impact includes trees left in buffers, special management zones, and those rendered uneconomic to harvest by these rules. A separate average or high impact regulatory threshold shall be established for western and eastern Washington. Criteria for these measurements and payments shall be established by the small forest landowner office.
     (9) The forest practices board shall adopt rules under the administrative procedure act, chapter 34.05 RCW, to implement the forestry riparian easement program, including the following:
     (a) A standard version or versions of all documents necessary or advisable to create the forestry riparian easements as provided for in this section;
     (b) Standards for descriptions of the easement premises with a degree of precision that is reasonable in relation to the values involved;
     (c) Methods and standards for cruises and valuation of forestry riparian easements for purposes of establishing the compensation. The department of natural resources shall perform the timber cruises of forestry riparian easements required under this chapter and chapter 76.09 RCW. Any rules concerning the methods and standards for valuations of forestry riparian easements shall apply only to the department of natural resources, ((small)) family forest landowners, and the small forest landowner office;
     (d) A method to determine that a forest practices application involves a commercially reasonable harvest, and adopt criteria for entering into a forest riparian easement where a commercially reasonable harvest is not possible or a forest practices application that has been submitted cannot be approved because of restrictions under the forest practices rules;
     (e) A method to address blowdown of qualified timber falling outside the easement premises;
     (f) A formula for sharing of proceeds in relation to the acquisition of qualified timber covered by an easement through the exercise or threats of eminent domain by a federal or state agency with eminent domain authority, based on the present value of the department of natural resources' and the landowner's relative interests in the qualified timber;
     (g) High impact regulatory thresholds;
     (h) A method to determine timber that is qualifying timber because it is rendered uneconomic to harvest by the rules adopted under RCW 76.09.055 and 76.09.370; and
     (i) A method for internal department of natural resources review of small forest landowner office compensation decisions under subsection (7) of this section.

Sec. 13   RCW 76.13.140 and 2002 c 120 s 3 are each amended to read as follows:
     In order to assist ((small)) family forest landowners, as defined in RCW 76.09.450, to remain economically viable, the legislature intends that the ((small)) family forest landowners be able to net fifty percent of the value of the trees left in the buffer areas. The amount of compensation offered in RCW 76.13.120 shall also include the compliance costs for participation in the riparian easement program. For purposes of this section, "compliance costs" includes the cost of preparing and recording the easement, and any business and occupation tax and real estate excise tax imposed because of entering into the easement. The office may contract with private consultants that the office finds qualified to perform timber cruises of forestry riparian easements or to lay out streamside buffers and comply with other forest and fish regulatory requirements related to the forest riparian easement program. The department shall reimburse ((small)) family forest landowners for the actual costs incurred for laying out the streamside buffers and marking the qualifying timber once a contract has been executed for the forestry riparian easement program. Reimbursement is subject to the work being acceptable to the department. The small forest landowner office shall determine how the reimbursement costs will be calculated.

Sec. 14   RCW 76.13.150 and 2003 c 311 s 7 are each amended to read as follows:
     (1) The legislature finds that a state-led cost-sharing program is necessary to assist ((small)) family forest landowners with removing and replacing fish passage barriers that were added to their land prior to May 14, 2003, to help achieve the goals of the forests and fish report, and to assist ((small)) family forest landowners in complying with the state's fish passage requirements.
     (2) The small forest landowner office must, in cooperation with the department of fish and wildlife, establish a program designed to assist ((small)) family forest landowners with repairing or removing fish passage barriers and assist lead entities in acquiring the data necessary to fill any gaps in fish passage barrier information. The small forest landowner office and the department of fish and wildlife must work closely with lead entities or other local watershed groups to make maximum use of current information regarding the location and priority of current fish passage barriers. Where additional fish passage barrier inventories are necessary, funding will be sought for the collection of this information. Methods, protocols, and formulas for data gathering and prioritizing must be developed in consultation with the department of fish and wildlife. The department of fish and wildlife must assist in the training and management of fish passage barrier location data collection.
     (3) The small forest landowner office must actively seek out funding for the program authorized in this section. The small forest landowner office must work with consenting landowners to identify and secure funding from local, state, federal, tribal, or nonprofit habitat restoration organizations and other private sources, including the salmon recovery funding board, the United States department of agriculture, the United States department of transportation, the Washington state department of transportation, the United States department of commerce, and the federal highway administration.
     (4)(a) Except as otherwise provided in this subsection, the small forest landowner office, in implementing the program established in this section, must provide the highest proportion of public funding available for the removal or replacement of any fish passage barrier.
     (b) In no case shall a ((small)) family forest landowner be required to pay more than the lesser of either: (i) Twenty-five percent of any costs associated with the removal or replacement of a particular fish passage barrier; or (ii) five thousand dollars for the removal or replacement of a particular fish passage barrier. No ((small)) family forest landowner shall be required to pay more than the maximum total annual costs in (c) of this subsection.
     (c) The portion of the total cost of removing or replacing fish passage barriers that a ((small)) family forest landowner must pay in any calendar year shall be determined based on the average annual timber volume harvested from the landowner's lands in this state during the three preceding calendar years, and whether the fish passage barrier is in eastern or western Washington.
     (i) In western Washington (west of the Cascade Crest), a ((small)) family forest landowner who has harvested an average annual timber volume of less than five hundred thousand board feet shall not be required to pay more than a total of eight thousand dollars during that calendar year, a ((small)) family forest landowner who has harvested an annual average timber volume between five hundred thousand and nine hundred ninety-nine thousand board feet shall not be required to pay more than a total of sixteen thousand dollars during that calendar year, a ((small)) family forest landowner who has harvested an average annual timber volume between one million and one million four hundred ninety-nine thousand board feet shall not be required to pay more than a total of twenty-four thousand dollars during that calendar year, and a ((small)) family forest landowner who has harvested an average annual timber volume greater than or equal to one million five hundred thousand board feet shall not be required to pay more than a total of thirty-two thousand dollars during that calendar year, regardless of the number of fish passage barriers removed or replaced on the landowner's lands during that calendar year.
     (ii) In eastern Washington (east of the Cascade Crest), a ((small)) family forest landowner who has harvested an average annual timber volume of less than five hundred thousand board feet shall not be required to pay more than a total of two thousand dollars during that calendar year, a ((small)) family forest landowner who has harvested an annual average timber volume between five hundred thousand and nine hundred ninety-nine thousand board feet shall not be required to pay more than a total of four thousand dollars during that calendar year, a ((small)) family forest landowner who has harvested an average annual timber volume between one million and one million four hundred ninety-nine thousand board feet shall not be required to pay more than a total of twelve thousand dollars during that calendar year, and a ((small)) family forest landowner who has harvested an average annual timber volume greater than or equal to one million five hundred thousand board feet shall not be required to pay more than a total of sixteen thousand dollars during that calendar year, regardless of the number of fish passage barriers removed or replaced on the landowner's lands during that calendar year.
     (iii) Maximum total annual costs for ((small)) family forest landowners with fish passage barriers in both western and eastern Washington shall be those specified under (c)(i) and (ii) of this subsection.
     (d) If an existing fish passage barrier on land owned by a ((small)) family forest landowner was installed under an approved forest practices application or notification, and hydraulics approval, and that fish passage barrier becomes a high priority for fish passage based on the watershed ranking in RCW ((76.13.150)) 77.12.755, one hundred percent public funding shall be provided.
     (5) If a ((small)) family forest landowner is required to contribute a portion of the funding under the cost-share program established in this section, that landowner may satisfy his or her required proportion by providing either direct monetary contributions or in-kind services to the project. In-kind services may include labor, equipment, materials, and other landowner-provided services determined by the department to have an appropriate value to the removal of a particular fish passage barrier.
     (6)(a) The department, using fish passage barrier assessments and ranked inventory information provided by the department of fish and wildlife and the appropriate lead entity as delineated in RCW 77.12.755, must establish a prioritized list for the funding of fish passage barrier removals on property owned by ((small)) family forest landowners that ensures that funding is provided first to the known fish passage barriers existing on forest land owned by ((small)) family forest landowners that cause the greatest harm to public resources.
     (b) As the department collects information about the presence of fish passage barriers from submitted checklists, it must share this information with the department of fish and wildlife and the technical advisory groups established in RCW 77.85.070. If the addition of the information collected in the checklists or any other changes to the scientific instruments described in RCW 77.12.755 alter the analysis conducted under RCW 77.12.755, the department must alter the funding order appropriately to reflect the new information.
     (7) The department may accept commitments from ((small)) family forest landowners that they will participate in the program to remove fish passage barriers from their land at any time, regardless of the funding order given to the fish passage barriers on a particular landowner's property.

Sec. 15   RCW 76.13.160 and 2004 c 102 s 2 are each amended to read as follows:
     When establishing a forest riparian easement program applicant's status as a qualifying ((small)) family forest landowner pursuant to RCW 76.13.120, the department shall not review the applicant's timber harvest records, or any other tax-related documents, on file with the department of revenue. The department of revenue may confirm or deny an applicant's status as a ((small)) family forest landowner at the request of the department; however, for the purposes of this section, the department of revenue may not disclose more information than whether or not the applicant has reported a harvest or harvests totaling greater than or less than the qualifying thresholds established in RCW 76.13.120. Nothing in this section, or RCW 84.33.280, prohibits the department from reviewing aggregate or general information provided by the department of revenue.