WSR 00-08-104

PROPOSED RULES

FOREST PRACTICES BOARD


[ Filed April 5, 2000, 10:31 a.m. ]

Original Notice.

Title of Rule: New chapter in Title 222 WAC: Chapter 222-21 WAC, Small forest landowner forestry riparian easement program.

Purpose: To establish the small forest landowner office in the Department of Natural Resources and administer the forest riparian easement program.

Statutory Authority for Adoption: Chapter 34.05 RCW, RCW 34.05.090, 76.09.040, [76.09.]050, [76.09.]055, 76.13.110, [76.13.]120.

Statute Being Implemented: Chapters 76.09, 76.13 RCW, RCW 76.46.300.

Summary: The legislature has authorized the board to adopt rules to implement the forestry riparian easement program, RCW 76.13.120(9). This chapter is being added to the board's emergency rules published under WSR 00-06-036. New sections WAC 222-21-005 Policy, 222-21-010 Definitions, 222-21-020 Criteria for accepting riparian easement, 222-21-030 Document standards, 222-21-035 Description of easement, 222-21-040 Timber cruises, 222-21-045 Valuation, 222-21-050 Payment of compensation, 222-21-060 Commercially reasonable harvest, 222-21-065 Uneconomic to harvest, 222-21-070 Blowdown and salvage, 222-21-080 Eminent domain and 222-21-090 Internal department of natural resources review of small forest landowner office compensation decisions; and amendatory sections WAC 222-12-020 Regulation sections and 222-12-090 Forest practices board manual.

Reasons Supporting Proposal: The legislature has found that the state should acquire easements along riparian and other sensitive aquatic areas from small forest landowners wiling to sell or donate such easements to the state (RCW 76.13.120(1)).

Name of Agency Personnel Responsible for Drafting: Judith Holter, 1111 Washington Street S.E., Olympia, WA 98504-7012, (360) 902-1412; Implementation and Enforcement: Catherine Elliott, 1111 Washington Street S.E., Olympia, WA 98504-7012, (360) 902-1041.

Name of Proponent: Forest Practices Board, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: The proposed rules implement those portions of the Salmon Recovery Act (ESHB 2091) pertaining to small forest landowners. The rules establish the forestry riparian easement program, as outlined in the statute. They also include the official easement document form to be executed between the department and the landowner.

The Anticipated Effects for These Rules: The rules provide standards and methods for these landowners to receive partial compensation, subject to available funding, for trees they are required to leave in riparian areas.

Proposal Changes the Following Existing Rules: A new chapter is added to Title 222 WAC that includes a policy statement of legislative intent, definitions, easement criteria and standards, timber cruises and valuation of timber, and other standards for the program. Two existing sections are amended to explain the organization of the rules and to identify guidelines for implementing the program. The guidelines will be provided in a new section of the forest practices board manual.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Not required per RCW 76.09.055(2).

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. Not required per RCW 76.09.055(2).

Hearing Location: Natural Resources Building, Room 172, 1111 Washington Street S.E., Olympia, WA, on May 9, 2000, at 3 p.m.

Assistance for Persons with Disabilities: Contact Forest Practices Board Secretary, (360) 902-1413, by May 1, 2000, TTY (360) 902-1125.

Submit Written Comments to: Judith Holter, Department of Natural Resources, Forest Practices Division, fax (360) 902-1789, by May 9, 2000, at 5 p.m.

Date of Intended Adoption: May 10, 2000.

April 3, 2000

John Daly

Chair

OTS-3931.1


AMENDATORY SECTION(Amending WSR 94-01-134, filed 12/20/93, effective 1/1/94)

WAC 222-12-020
Regulation sections.

These regulations are organized as follows:


Chapter 222-08 WAC Practices and procedures.
Chapter 222-10 WAC State Environmental Policy Act Guidelines.
Chapter 222-12 WAC Policy and organization.
Chapter 222-16 WAC Definitions.
Chapter 222-20 WAC Application and notification procedures.
Chapter 222-21 WAC Small forest landowner forestry riparian easement program.
Chapter 222-22 WAC Watershed analysis.
Chapter 222-24 WAC Road construction and maintenance.
Chapter 222-30 WAC Timber harvesting.
Chapter 222-34 WAC Reforestation.
Chapter 222-38 WAC Forest chemicals.
Chapter 222-42 WAC Supplemental directives.
Chapter 222-46 WAC Consultation and enforcement.
Chapter 222-50 WAC Relationship to other laws and regulations.

[Statutory Authority: RCW 76.09.040, 76.09.170 and chapter 34.05 RCW. 94-01-134, 222-12-020, filed 12/20/93, effective 1/1/94. Statutory Authority: RCW 76.09.040 and chapter 34.05 RCW. 93-12-001, 222-12-020, filed 5/19/93, effective 6/19/93; Order 263, 222-12-020, filed 6/16/76.]

OTS-3982.1


AMENDATORY SECTION(Amending WSR 97-24-091, filed 12/3/97, effective 1/3/98)

WAC 222-12-090
Forest practices board manual.

When approved by the board the manual serves as an advisory technical supplement to these forest practices regulations. The department, in cooperation with the departments of fish and wildlife, agriculture, ecology, and such other agencies, affected Indian tribes, or interested parties as may have appropriate expertise, is directed to prepare, and submit to the board for approval, revisions to the forest practices board manual. The manual shall include:

(1) Method for determination of adequate shade requirements on streams needed for use with WAC 222-30-040.

(2) The standard methods for measuring ((channel width, stream gradient and flow which are used in the water typing criteria WAC 222-16-030)) physical parameters of streams and channel migration zones.

(3) ((A chart for establishing recommended permanent culvert sizes and associated data.)) Guidelines for forest roads.

(4) Guidelines for clearing slash and debris from Type 4 and 5 Waters.

(5) Guidelines for landing location and construction.

(6) Guidelines for determining acceptable stocking levels.

(7) Guidelines for ((calculating average widths of)) riparian management zones.

(8) Guidelines for wetland delineation.

(9) Guidelines for wetland replacement or substitution.

(10) A list of nonnative wetland plant species.

(11) The standard methodology, which shall specify the quantitative methods, indices of resource conditions, and definitions, for conducting watershed analysis under chapter 222-22 WAC. The department, in consultation with Timber/Fish/Wildlife's Cooperative Monitoring, Evaluation and Research Committee (CMER), may make minor modifications to the version of the standard methodology approved by the board. Substantial amendments to the standard methodology requires approval by the board.

(12) Guidelines for forest chemicals.

(a) A list of special concerns related to aerial application of pesticides developed under WAC 222-16-070(3).

(b) Guidelines for aerial applications of pesticides and other forest chemicals under chapter 222-38 WAC.

(13) Guidelines for determining fish use for the purpose of typing waters under WAC 222-16-030.

(14) Survey protocol for marbled murrelets. The Pacific seabird survey protocol in effect March 1, 1997, shall be used when surveying for marbled murrelets in a stand. Surveys conducted before the effective date of this rule are valid if they were conducted in substantial compliance with generally accepted survey protocols in effect at the beginning of the season in which they were conducted.

(15) The department shall, in consultation with the department of fish and wildlife, develop platform protocols for use by applicants in estimating the number of platforms, and by the department in reviewing and classifying forest practices under WAC 222-16-050. These protocols shall include:

(a) A sampling method to determine platforms per acre in the field;

(b) A method to predict the number of platforms per acre based on information measurable from typical forest inventories. The method shall be derived from regression models or other accepted statistical methodology, and incorporate the best available data; and

(c) Other methods determined to be reliable by the department, in consultation with the department of fish and wildlife.

(16) Guidelines for evaluating potentially unstable slopes and landforms.

(17) Guidelines for the small forest landowner forestry riparian easement program.

[Statutory Authority: RCW 76.09.040 and chapter 34.05 RCW. 97-24-091, 222-12-090, filed 12/3/97, effective 1/3/98; 97-15-105, 222-12-090, filed 7/21/97, effective 8/21/97. Statutory Authority: RCW 76.09.040, 76.09.050 and chapter 34.05 RCW. 92-15-113, 222-12-090, filed 7/21/92, effective 8/21/92. Statutory Authority: RCW 76.09.040. 88-19-112 (Order 551, Resolution No. 88-1), 222-12-090, filed 9/21/88, effective 11/1/88; 87-23-036 (Order 535), 222-12-090, filed 11/16/87, effective 1/1/88. Statutory Authority: RCW 76.09.040 and 76.09.050. 82-16-077 (Resolution No. 82-1), 222-12-090, filed 8/3/82, effective 10/1/82; Order 263, 222-12-090, filed 6/16/76.]

OTS-3927.2

Chapter 222-21 WAC

SMALL FOREST LANDOWNER FORESTRY RIPARIAN EASEMENT PROGRAM


NEW SECTION
WAC 222-21-005
Policy.

The legislature has found that further reduction in harvestable timber owned by small forest landowners as a result of the rules adopted under RCW 76.09.055 or 76.09.370 will further erode small 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. The legislature addressed these concerns by establishing a forestry riparian easement program to acquire easements from small forest landowners along riparian and other areas of value to the state for protection of aquatic resources.

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NEW SECTION
WAC 222-21-010
Definitions.

The following definitions apply to this chapter:

(1) "Commercially reasonable harvest unit" means a harvest area that meets the requirements of WAC 222-21-060.

(2) "Completion of harvest" means that the trees have been harvested from an area under an approved forest practices application and that further entry into that area by any type of logging or slash treating equipment or method is not expected.

(3) "Danger tree" means any tree reasonably perceived to pose an imminent danger to life or improved property.

(4) "Easement premises" means the geographic area designated in a forestry riparian easement, including the areas in which qualifying timber is located. Easement premises may be categorized as follows:

(a) Riparian area easement premises means riparian areas and areas upon which qualifying timber associated with riparian areas are located.

(b) Other easement premises means areas of land required to be left unharvested under rules adopted under RCW 76.09.055 or 76.09.370 including areas upon which other qualifying timber outside riparian areas is located and areas of land upon which uneconomic qualifying timber is located.

(5) "Forestry riparian easement" means an easement covering qualifying timber granted voluntarily to the state by a small forest landowner.

(6) "High impact regulatory threshold" means the threshold where the value of qualifying timber is greater than 26% (for timber in Western Washington) or 17% (for timber in Eastern Washington) of the value of the harvest under the approved forest practices application covering the qualifying timber. This threshold will be revised after preparation of the final small business economic impact statement (SBEIS) prepared under chapter 19.85 RCW.

(7) "Qualifying timber" means those trees covered by a forest practices application that the small forest landowner is required to leave unharvested under rules adopted under RCW 76.09.055 or 76.09.370 or that are made uneconomic to harvest by those rules, and for which the small forest landowner is willing to grant the state a forestry riparian easement. Qualifying timber is timber within or bordering a commercially reasonable harvest unit. Qualifying timber is categorized as follows:

(a) Permanent qualifying timber includes trees that shall not be harvested or damaged or removed from the easement premises during the term of the easement.

(i) Where permanent qualifying timber is in areas in which no harvest may take place, the easement shall describe the boundaries of the areas. No harvest of any tree within this area shall take place during the term of the easement.

(ii) Where permanent qualifying timber is located in areas in which selective harvest may take place, the permanent qualifying timber must be permanently tagged.

(b) Reserve qualifying timber includes trees that may be harvested and removed but only in compliance with the terms of the easement. Reserve qualifying timber shall be identified separately from the permanent qualifying timber.

(c) Replacement qualifying timber includes trees which, in the future, will be substituted for the reserve qualifying timber before the reserve qualifying timber may be harvested or removed from the property. Replacement qualifying timber will be selected from time to time pursuant to the provisions of the easement and will be subject to the terms and protections of the easement.

(d) Uneconomic qualifying timber includes trees made uneconomical to harvest. The trees are considered permanent qualifying timber and may not be harvested or otherwise damaged during the term of the easement.

(e) Other qualifying timber outside riparian areas includes trees that may not be harvested under forest practices rules adopted under RCW 76.09.055 or 76.09.370 for reasons other than protection of riparian functions. It includes without limitation trees that are unharvestable because of public safety concerns. The trees are considered permanent qualifying timber and may not be harvested or otherwise damaged during the term of the easement.

(8) "Riparian areas" include the areas designated in a forestry riparian easement. Riparian areas include without limitation all riparian and other special management zones required by the forest practices rules for protection of aquatic resources and includes associated qualifying timber.

(9) "Riparian function" includes without limitation bank stability, recruitment of woody debris, leaf litter fall, nutrients, sediment filtering, shade, and other riparian features important to both riparian forest and aquatic systems conditions.

(10) "Small forest landowner" means a forest landowner meeting all of the characteristics in (a) of this subsection unless any of the exceptions in (b) of this subsection are met.

(a) As of the date a forest practices application is received for which the forestry riparian easement is associated, the forest landowner:

(i) Is 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 forest landowner under this section;

(ii) Has a fee interest in the land and timber or has rights to harvest 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 received;

(iii) 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 forest landowner as a small timber harvester under RCW 84.33.073(1); and

(iv) Certifies at the time the forest practices application is received that it does not expect to harvest from its own lands more than the volume allowed by RCW 84.33.073(1) during the ten years following receipt of the application.

(b) At the time the forest practices application is received, a forest landowner whose prior three-year average harvest exceeds the limit of RCW 84.33.073(1), or who expects to exceed this limit during the ten years following receipt of the forest practices application, may still qualify as a small forest landowner if that landowner establishes to the small forest landowner office's 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. (Note: The small forest landowner office will establish a board manual governing these exceptions.)

(11) "Small forest landowner office" is an office within the department described in RCW 76.13.110.

(12) "Uneconomic to harvest" means that a harvest area meets the requirements of WAC 222-21-065.

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NEW SECTION
WAC 222-21-020
Criteria for accepting riparian easement.

(1) All of the following criteria must be met before the small forest landowner office may acquire a forestry riparian easement:

(a) The easements must include qualifying timber within riparian areas and may include other qualifying timber;

(b) The small forest landowner must be willing to sell or donate such easements to the state;

(c) The small forest landowner has a final, approved forest practices application including qualifying timber on the easement premises;

(d) The small forest landowner office has received an application for a forestry riparian easement;

(e) The small forest landowner has provided a litigation guarantee or similar report from a title company for the property;

(f) Acceptable documents necessary for creation of the easement have been prepared; and

(g) The easement is not subject to unacceptable liabilities in subsection (3) of this section.

(2) Where more than one person has an interest in property to be covered by a forestry riparian easement, all persons holding rights to control or affect the easement premises, qualifying timber, and the riparian functions provided by the qualifying timber during the term of the easement must execute the easement documents or otherwise subordinate their interest to the easement interest being acquired by the state. This includes tenants in common, joint tenants, holder of reversionary interests, lien holders, and mortgages.

(3) Unacceptable liabilities for the state include, but are not limited to, the following:

(a) Potential liability exposure due to the presence of hazardous substances;

(b) Where the department does not have satisfactory access to the easement premises;

(c) Existing uses of the property that may jeopardize the protection of the easement premises, qualifying timber, and riparian functions;

(d) Any other liability where the liability may jeopardize the protection of the easement premises, qualifying timber, and its riparian functions.

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NEW SECTION
WAC 222-21-030
Document standards.

(1) Riparian easement. The riparian easement document must be substantially in the following form, but may be modified by the small forest landowner office wherever necessary to accomplish the purposes of RCW 76.13.120.

(This version assumes ownership of land and trees)


FORESTRY RIPARIAN EASEMENT
THIS GRANT OF A FORESTRY RIPARIAN EASEMENT is made on this day of , 20 , by [a corporation, limited liability company, partnership, limited partnership, limited liability partnership] [husband and wife] [individual][or others as appropriate] having an address at ("Grantor"), to and in favor of the State of Washington, acting by and through the Department of Natural Resources ("Grantee").
1.0 RECITALS AND PURPOSE
1.1This Easement is intended to implement the goals of the Forest Practices Salmon Recovery Act, ESHB 2091, sections 501 through 504, chapter 4, Laws of 1999 ("Salmon Recovery Act"). The goals include establishment of a comprehensive, coordinated state-wide program for protection and enhancement of Riparian Functions; and compensation for small forest landowners who are impacted by forest practices rules adopted under the Salmon Recovery Act.
1.2This Easement is intended to protect the Qualifying Timber and the Riparian Functions associated with the qualifying timber located on the Easement Premises as provided by the terms of this Easement while preserving all lawful uses of the Property by Grantor consistent with the Easement objectives, and to provide Grantee with the ability to enforce the terms thereof.
1.3Grantor and Grantee agree that the Easement Premises and Qualifying Timber, and the Property upon which both are located, are as described in Exhibit A; that the encumbrances are as set forth in Exhibit B; that all Exhibits referenced herein and attachments thereto are incorporated into this Easement as part of this Easement; and that the Grantor wishes to execute this Forestry Riparian Easement.
2.0 CONVEYANCE AND CONSIDERATION
2.1In consideration of the mutual covenants contained herein, including without limitation the monetary consideration set forth in subsection 2.2 below, the Grantor does hereby voluntarily warrant and convey to the Grantee a Forestry Riparian Easement under the Salmon Recovery Act, which Easement shall remain in full force and effect from the date hereof until it expires on , 2 [50 years from the date the complete and accurate forest practices application is submitted], which Easement shall consist of the rights and restrictions expressly set forth herein.
2.2In consideration of this Easement, Grantee shall pay to Grantor the sum of dollars ($ .00).
IN WITNESS WHEREOF Grantor and Grantee have executed this instrument on the day and year written.
GRANTOR:
Date:
By:
GRANTEE:
State of Washington
By and Through the Department of

Natural Resources

Date:
(Title)

EXHIBIT A
A1 LEGAL DESCRIPTION OF PROPERTY
The Grantor is the owner [specific kinds of ownership interest] of certain real property and timber thereon located in County, Washington. The legal description of the Property is as follows:
The parties agree that the legal description of the Property is documented in Attachment A-1.
A2 DESCRIPTION AND LOCATION OF QUALIFYING TIMBER
The Qualifying Timber includes the following categories and is more particularly described in Attachment A-2.
[List the categories relevant to particular Easement, i.e., Permanent, Reserve, Replacement, Uneconomic, or Other Qualifying Timber, and their locations.]
A3 DESCRIPTION AND LOCATION OF EASEMENT PREMISES
The Easement Premises includes the following categories which are more particularly described in Attachment A-3. The Easement Premises covers only that portion of the property covered in Attachment A-3.
[List the categories relevant to particular Easement, i.e., Riparian Area and Other Easement Premises, where applicable, and document their locations.]
(NOTE: The language in this exhibit is under review to clarify that only the Easement Premises portion of the Property will be affected when recorded.)
A4 BASELINE IDENTIFICATION, DESCRIPTION AND DOCUMENTATION OF PROPERTY, EASEMENT PREMISES AND QUALIFYING TIMBER
The parties agree that the current use of the Property; the current use, condition, and Riparian Function on the Easement Premises and the condition of the Qualifying Timber are documented in the inventory of their relevant features and identified in Attachment A-4 ("Baseline Documentation"), and that this documentation provides, collectively, an accurate representation at the time of this grant and is intended to serve as an objective information baseline for monitoring compliance with the terms of this grant.


EXHIBIT B
FORESTRY RIPARIAN EASEMENT TERMS AND CONDITIONS
B1 DEFINITIONS
The terms used in this Easement, including without limitation the following, are defined by the forest practices rules incorporated in Attachment B-1 to this Exhibit.
"Danger Tree"
"Easement Premises"
"Qualifying Timber"
"Riparian Areas"
"Riparian Function"
B2 RIGHTS OF GRANTEE **[Subsection B2.4 should be included only for multiple entry Easements.]**
To accomplish the purposes of this Easement, the following rights are conveyed to Grantee by this Easement:
B2.1 To enforce the terms of this Easement as provided in subsection B9.
B2.2 To enter upon the Easement Premises, or to allow Grantee's agents or any experts consulted by Grantee in exercising its rights under this Easement to enter upon the Easement Premises in order to monitor Grantor's compliance with this Easement, and to otherwise enforce the terms of this Easement.
B2.3 To convey, assign, or otherwise transfer Grantee's interests herein to another agency of the State of Washington, as provided for and limited by Section 504 of the Salmon Recovery Act.
B2.4 Where harvest of Reserve Qualifying Timber is allowed during the term of this Easement, to approve Replacement Qualifying Timber that will be protected by this Easement as provided in subsection B3.6.
B3 RESTRICTIONS ON GRANTOR **[Subsection B3.6 should be included only for multiple entry Easements.]**
B3.1 Inconsistent Uses
Any use of, or activity on, the Easement Premises inconsistent with the purposes and terms of this Easement is prohibited, and Grantor acknowledges and agrees that it will not conduct, engage in, or permit any such use or activity.
B3.2 Riparian Easement Premises
Grantor shall not use the Easement Premises inconsistent with the purposes and terms of this Easement, including without limitation converting to a use incompatible with growing timber.
B3.3 Property Outside the Easement Premises
Grantor may change to any lawful use. Grantor shall provide Grantee sixty (60) days notice prior to changing the use of the Property as a courtesy to Grantee.
B3.4 Qualifying Timber
Grantor shall not engage in any activity which would impair or threaten to impair the condition or health of the Qualifying Timber, including without limitation cutting or harvesting such timber or causing the removal of that timber from the Easement Premises, except as provided in this Easement. The parties further agree that use, harvest, and treatment of the Qualifying Timber are restricted according to the forest practices rules in Attachment B-1.
B3.5 Danger Trees and Salvage on or near the Easement Premises
Grantor may cut a Danger Tree, which shall be left in place or moved inside the Easement Premises. Grantor shall notify DNR within seven (7) days that a Danger Tree has been felled. Grantor shall not engage in any activities pertaining to salvage of Qualifying Timber including without limitation blowdown except as provided for in the forest practices rules.
B3.6 Harvest of Reserve Qualifying Timber and Designation of Replacement Qualifying Timber on Riparian Area Easement Premises
Grantor shall not, during the term of this Easement, harvest or remove any Reserve Qualifying Timber except as permitted under the applicable forest practices rules. Grantor shall give Grantee at least thirty (30) days written notice prior to harvest or removal of Reserve Qualifying Timber, except that where a permit or approval is required from any governmental entity, such notice shall be given thirty (30) days before submission of the application for such permit or approval. Grantor shall mark Reserve Qualifying Timber and Replacement Qualifying Timber, where Replacement Qualifying Timber is required, for review by Grantee. If Grantee does not object by giving Grantor written notice within thirty (30) days of receipt of Grantor's notice, Grantor may proceed to harvest and remove the Reserve Qualifying Timber. If Grantee does object and gives Grantor written notice thereof within thirty (30) days of receipt of Grantor's notice, Grantor shall not harvest or remove Reserve Qualifying Timber until the objection is resolved. If Reserve Qualifying Timber is to be removed but Replacement Qualifying Timber is required to be left standing for the balance of the term of this Easement, then Grantor shall mark the Replacement Qualifying Timber and, if approved by Grantee, such Timber shall be considered Qualifying Timber under this Easement. A new Exhibit A shall be prepared along with a supplement to this Easement, executed by Grantor and Grantee, and recorded. Grantor's thirty (30) days written notice to Grantee required in this subsection is considered effective only after both Reserve Qualifying Timber and Replacement Qualifying Timber are marked.
B4 RESERVED RIGHTS
Other than specifically provided herein, Grantor is not restricted in its use of the Easement Premises.
B5 PUBLIC ACCESS
No right of public access to or across, or any public use of, the Property is conveyed by this Easement.
B6 COSTS, LIABILITIES, TAXES, AND INDEMNIFICATION
B6.1 Costs, Legal Requirements, and General Liabilities
Except as is expressly placed on Grantee herein, Grantor retains full responsibility for the Qualifying Timber and Easement Premises. Grantor shall keep the Qualifying Timber and Easement Premises free of any liens arising out of any work performed for, materials furnished to, or obligations incurred by Grantor. Grantor remains responsible for obtaining all permits required by law.
B6.2 Taxes and Obligations
Grantor shall be responsible for payment of taxes or other assessments imposed on the Easement Premises or the Qualifying Timber. Grantor shall furnish Grantee with satisfactory evidence of payment upon request.
B6.3 Hold Harmless
B6.3.a Grantor
Grantor hereby releases and agrees to hold harmless, indemnify, and defend Grantee and its employees, agents, and assigns ("Indemnified Parties") from and against all liabilities, penalties, costs, charges, losses, damages, expenses, causes of action, claims, demands, orders, judgments, or administrative actions, including without limitation reasonable attorneys' fees arising from or in any way connected with: (a) Injury or death of any person or any physical damage to property resulting from any act or omission, or other matter occurring on or relating to the Easement Premises or Qualifying Timber, caused solely by Grantor; (b) a breach by Grantor of its obligations under subsection B3; (c) the violation or alleged violation of, or other failure to comply with, any state, federal, or local law or requirement by Grantor in any way affecting, involving, or relating to the Easement Premises or the Qualifying Timber; (d) the release or threatened release onto the Easement Premises of any substance now or hereinafter classified by state or federal law as a hazardous substance or material caused solely by Grantor.
B6.3.b Grantee
To the extent permitted by law, Grantee hereby releases and agrees to hold harmless, indemnify and defend Grantor and its employees, agents, and assigns ("Indemnified Parties") from and against all liabilities, penalties, costs, charges, losses, damages, expenses, causes of action, claims, demands, orders, judgments or administrative actions, including without limitation reasonable attorneys' fees arising from or in any way connected with: (a) Injury or death of any person or any physical damage to property resulting from any act or omission, or other matter occurring on or relating to the Easement Premises or Qualifying Timber, caused solely by Grantee; or (b) the release or threatened release onto the Easement Premises of any substance now or hereinafter classified by state or federal law as a hazardous substance or material caused solely by Grantee.
B7 SUBSEQUENT TRANSFERS
B7.1 Grantee
Grantee may assign, convey, or otherwise transfer its interest as evidenced in this Easement, but only to another agency of the State of Washington under any circumstances in which it determines, in its sole discretion, that such transfer is in the best interests of the state. Grantee shall give written notice to Grantor of the same within thirty (30) days of such conveyance, assignment, or transfer (provided that failure to give such notice shall not affect the validity of the assignment, conveyance, or transfer).
B7.2 Grantor
Grantor may assign, convey, or otherwise transfer without restriction its interest in the Easement Premises or the Qualifying Timber identified in Exhibit A hereto. Grantor agrees to incorporate the restrictions of the Easement in any deed or other legal instrument by which Grantor divests itself of all or a portion of its interests in the Easement Premises or Qualifying Timber. Grantor shall give written notice to the Grantee of the assignment, conveyance, or other transfer of all or a portion of its interest in the Easement Premises or the Qualifying Timber within thirty (30) days of such conveyance, assignment, or transfer (provided that failure to give such notice shall not affect the validity of the assignment, conveyance, or transfer).
B7.3 Termination of Grantor's Rights and Obligations
The Grantor's personal rights and obligations under this Easement terminate upon transfer of the Grantor's interest in the Property or the Qualifying Timber, except that liability for acts or omissions occurring prior to transfer shall survive transfer.
B8 DISPUTE RESOLUTION
The parties may at any time by mutual agreement use any nonbinding alternative dispute resolution mechanism with a qualified third party acceptable to Grantor and Grantee. Grantor and Grantee shall share equally the costs charged by the third party. The existence of a dispute between the parties with respect to this Easement, including without limitation the belief by one party that the other party is in breach of its obligations hereunder, shall not excuse either party from continuing to fully perform its obligations under this Easement. The dispute resolution provided for in this subsection is optional, not obligatory, and shall not be required as a condition precedent to any remedies for enforcement of this Easement.
B9 ENFORCEMENT
B9.1 Remedies
Either party may bring any action in law or in equity in the superior court for the county in which the Easement Premises are located or in Thurston County to enforce any provision of this Easement, including without limitation, injunctive relief (permanent, temporary, or ex parte, as appropriate) to prohibit a breach of this Easement, enforce the rights and obligations of this Easement, restore or mitigate Riparian Functions and Qualifying Timber, and/or an action for damages. If Qualifying Timber has been removed from the Easement Premises in violation of this Easement, Grantee shall be entitled to damages, mitigation, or restoration. Damages for removal of Qualifying Timber from the Easement Premises in violation of the terms of this Easement shall be up to half the triple stumpage value plus the maximum interest allowable by law for the Timber removed. Restoration of Qualifying Timber may include either replanting trees or designation of replacement trees of the size and species acceptable to Grantee, whichever method is determined by Grantee, in its sole discretion, to be appropriate. If Qualifying Timber or Riparian Functions are harmed, Grantee shall be entitled to restoration by the Grantor. The remedies provided herein shall be cumulative and shall be in addition to all remedies now or hereafter existing at law or in equity. Grantor agrees that Grantee's remedies at law for any violation of the terms of this Easement are inadequate and that Grantee shall be entitled to injunctive relief, both prohibitive and mandatory, in addition to other relief to which Grantee may be entitled, including specific performance of the terms of this Easement, without the necessity of providing either actual damages or the inadequacy of otherwise available legal remedies. The rights under this subsection shall apply equally in the event of either actual or threatened violations of the terms of this Easement.
B9.2 Costs of Enforcement
The costs, including reasonable attorneys' fees, of enforcing this Easement shall be borne by Grantor unless Grantor prevails in any action to enforce the terms of this Easement, in which case costs shall be borne by Grantee.
B9.3 Forbearance/Waiver
Enforcement of this Easement against the Grantor is at the sole discretion of the Grantee, and vice versa. Any forbearance by either party to exercise its rights hereunder in the event of a breach by the other party shall not be deemed a waiver by the forbearing party of the term being breached or of a subsequent breach of that term or any other term or of any other of the forbearing party's rights under this Easement.
B9.4 Waiver of Certain Defenses
Grantor hereby waives any defense of laches, estoppel, or prescription.
B9.5 Acts Beyond Grantor's Control
Nothing herein shall be construed to entitle Grantee to bring any action or claim against Grantor on account of any change in the condition of the Easement Premises or of the Qualifying Timber that was not within Grantor's control, including without limitation fire, flood, storms, insect and disease outbreaks, earth movement, or acts of trespassers, that Grantor could not reasonably have anticipated and prevented, or from any prudent action taken by Grantor under emergency conditions to prevent, abate, or mitigate significant injury to the Easement Premises or Qualifying Timber resulting from such causes. In the event the terms of this Easement are violated by acts of trespassers that Grantor could not reasonably have anticipated or prevented, Grantor agrees, at Grantee's option, to join in any suit, to assign its right of action to Grantee, or to appoint Grantee its attorney in fact, for the purpose of pursuing enforcement action against the responsible parties.
B10 CONSTRUCTION AND INTERPRETATION
B10.1 Controlling Law
Interpretation and performance of this Easement shall be governed by the laws of the State of Washington.
B10.2 Liberal Construction
Any general rule of construction to the contrary notwithstanding, this Easement shall be liberally construed in favor of the grant to effect the purposes of this Easement. If any provision in this instrument is found to be ambiguous, an interpretation consistent with the purposes of this Easement that would render the provision valid shall be favored over any interpretation that would render it invalid. The parties acknowledge that each has had an opportunity to have this Easement reviewed by an attorney and agree that the terms shall not be presumptively construed against either party.
B10.3 Captions
The captions in this instrument have been inserted solely for convenience of reference and are not a part of this instrument and shall have no effect upon construction or interpretation.
B11 AMENDMENT
This Easement may be jointly amended. The amendments shall be in writing and signed by authorized representatives. Grantee shall record any such amendments in timely fashion in the official records of County, Washington. All amendments shall be consistent with the purposes of this Easement.
B12 TERMINATION
Grantee may unilaterally terminate this Easement if it determines, in its sole discretion, that termination is in the best interests of the State of Washington. Grantee shall provide thirty (30) days written notice to Grantor of such termination. Compensation due Grantee, if any, shall be in accordance with the forest practices rules or other applicable law in effect at the time of the termination.
B13 EXTINGUISHMENT
If circumstances arise that render the purpose of this Easement impossible to accomplish, this Easement can only be terminated or extinguished, in whole or in part, by mutual agreement of the parties or through judicial proceedings brought by one of the parties. Grantee shall be entitled to the value of the Easement as such value is determined pursuant to forest practices rules governing extinguishment. If there are no forest practices rules governing extinguishment, Grantee shall be entitled to the value of the Easement, or proportionate part thereof, which would have remained had the Easement continued as of the date the Easement is extinguished.
B14 CONDEMNATION
If the Easement is taken, in whole or in part, by exercise of the power of eminent domain, or acquired by purchase in lieu of condemnation, Grantee shall be entitled to compensation in accordance with the forest practices rules.
B15 NOTICE
Notices given pursuant or in relation to this Easement shall be in writing and delivered personally or by first class mail (postage pre-paid), addressed as follows:
(a) If to Grantor:
(b) If to Grantee:
Washington State Department of Natural Resources
Small Forest Landowner Office
DNR-Forest Practices Division
P.O. Box 47012
Olympia, WA 98504-7012
If either party's address changes during the term of this Easement, that party shall notify the other party of the change.
Any notice required to be given hereunder is considered as being received: (i) If delivery in person, upon personal receipt by the person to whom it is being given; or (ii) if delivered by first class U.S. mail and properly addressed, three (3) days after deposit into the U.S. mail; or (iii) if sent by U.S. mail registered or certified, upon the date receipt is acknowledged by the recipient.
B16 RECORDATION
Grantee shall record this instrument in timely fashion in the official records of County, Washington and may re-record it at any time as may be required to preserve its rights in this Easement.
B17 GENERAL PROVISIONS
B17.1 Severability
If any provision in this Easement, or the application hereof to any person or circumstance, is found to be invalid, the remainder of this Easement, or the application hereof to other persons or circumstances shall not be affected thereby and shall remain in full force and effect.
B17.2 Entire Agreement
This instrument sets forth the entire agreement of the parties with respect to the Easement. This instrument supersedes all other and prior discussions, negotiations, understandings, or agreements of the parties. No alteration or variation of this instrument shall be binding unless set forth in an amendment to this instrument consistent with subsection B11.
B17.3 Successors and Assigns
The covenants, terms, conditions, and restrictions of this Easement shall be binding upon and inure to the benefit of the Grantor, Grantee, and their respective successors and assigns and shall continue as a servitude running with the Property for the term of this Easement set forth in subsection 2.1.
B17.4 No Forfeiture
Nothing contained herein will result in a forfeiture or reversion of Grantor's title in any respect.
B17.5 Counterparts
The parties may execute this instrument in two or more counterparts which shall, in the aggregate, be signed by both parties. Each counterpart shall be deemed an original as against the party that has signed it. In the event of any disparity between counterparts produced, the recorded counterpart shall be controlling.
B17.6 References to Statutes and Rules
Except as otherwise specifically provided, any references in this Easement to any statute or rule shall be deemed to be a reference to such statute or rule in existence at the time the action is taken or the event occurs.
B17.7 Adherence to Applicable Law
Any activity pertaining to or use of the Easement Premises or Qualifying Timber shall be consistent with applicable federal, state, or local law including chapter 76.09 RCW, the Forest Practices Act, chapter 36.70A RCW, the Growth Management Act, chapter 90.58 RCW, the Shoreline Management Act, chapter 75.20 RCW, Construction Projects in State Waters Act ("Hydraulics Code"), the Endangered Species Act (16 U.S.C. Sec. 1531, et seq.), and the Clean Water Act (33 U.S.C. Sec. 1251, et seq.), and rules and regulations adopted pursuant to these statutes (including all rules adopted under Section 4(d) of the Endangered Species Act).

(2) Forestry riparian easement application. The following items are required for a complete forestry riparian easement application:

(a) A certification by the small forest landowner that he or she meets the qualifications of a small forest landowner;

(b) The small forest landowners' timber tax identification number and permission to access harvest information at the department of revenue;

(c) All forest practices application numbers for the commercially reasonable harvest units and the associated qualifying timber on the property;

(d) The dates and areas of all planned future harvest entries on the easement premises;

(e) A preliminary litigation guarantee or similar report from a title company for the tax parcels that contain the easement premises;

(f) A description of past and current uses of the easement premises;

(g) Any information not specifically listed that the small forest landowner office needs to evaluate the easement and eligibility of the small forest landowner.

(3) Baseline documentation. The baseline documentation must describe the features and current uses on the easement premises and the qualifying timber. The information provided by the small forest landowner in subsection (2) of this section is considered part of the baseline documentation. In addition, the department will provide documentation that includes, but is not limited to:

(a) Cruise information consistent with the standards and methods in WAC 222-21-040;

(b) An assessment to determine site condition and potential liabilities associated with the proposed riparian easement (see the board manual on procedures for conducting assessment); and

(c) A description of the easement consistent with WAC 222-21-035.

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Reviser's note: The brackets and enclosed material in the text of the above section occurred in the copy filed by the agency and appear in the Register pursuant to the requirements of RCW 34.08.040.
NEW SECTION
WAC 222-21-035
Description of easement.

The easement premises and qualifying timber must be described as follows:

(1) Range, township, section, and parcel number;

(2) Forest practice base map of proposed harvest, other forest practice activities and easement;

(3) 1:400 map of the easement premises indexed either to 1 legal land survey point or 2 geopositional system points; and

(4) Traverse of the easement premises tied to subsection (3) of this section. (See the board manual for standards of traverse.)

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NEW SECTION
WAC 222-21-040
Timber cruises.

(1) This section is designed to establish methods and standards for cruises of qualifying timber for the proposed forestry riparian easements for purposes of establishing the compensation. It applies only to the department, small forest landowners, and the small forest landowner office in connection with the forestry riparian easement program.

(2) The following standards will be used for the timber cruises:

(a) The purpose of the timber cruise is to determine the volume by species and grade sufficient to value the qualifying timber.

(b) Additional trees left voluntarily by the small forest landowner may be noted, but are not included in the cruise volume.

(c) The cruise method will be a 100 percent inventory of qualifying timber on the proposed easement premises. The inventory will include species, diameter class, grade, and any other information necessary to determine valuation of the easement. (See the board manual for specific cruise standards.)

(d) A sampling cruise method may be used for easement premises under certain circumstances. (See the board manual for standards for sampling cruise method.)

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NEW SECTION
WAC 222-21-045
Valuation.

(1) This section is designed to establish methods and standards for valuation of forestry riparian easements for purposes of establishing the compensation. It applies only to the department, small forest landowners, and the small forest landowner office in connection with the forestry riparian easement program.

(2) The small forest landowner office will calculate the fair market value of the forestry riparian easement as of the date of receipt of the forest practices application associated with the qualifying timber. Data obtained or maintained by the department of revenue under RCW 84.33.074 and 84.33.091 will be used and adjusted to the date of receipt of the forest practices application associated with the qualifying timber. The small forest landowner must indicate whether valuation will be calculated using method (a) or (b) below. In either, the time adjustment index will be based on log price changes. The small forest landowner office will determine the specific log species and/or sorts and the log price reporting service to use after consultation with the small forest landowner advisory committee established under RCW 76.13.110(4) and the department of revenue. The small forest landowner office will generate an index monthly that reflects the time adjustments using information and data obtained from the department of revenue.

(a) Tax reporting and stumpage value determination table. The small forest landowner office will use the department of revenue stumpage value tables to determine stumpage value and the time adjustment index to adjust the values forward to the date of receipt of the forest practices application. The landowner must provide the small forest landowner office with:

(i) The reference for the applicable tax reporting stumpage value table and any other needed information for use of the table (see the board manual for details) or the report for the harvest from the department of revenue; and

(ii) Any information the small forest landowner would like the department to consider in its cruise of the qualifying timber.

(b) Small harvester tax return. The landowner must provide mill or buyer information to the department on the sale breakdown. This includes:

(i) The volume and scaling bureau log grades of each species harvested;

(ii) The amount received for each species; and

(iii) The actual harvesting and marketing costs as defined in the department of revenue small harvester instructions.

The price received for the timber is adjusted to the date of receipt of the forest practices application using the time adjustment index. The value of the qualifying timber is determined by adjusting the price for the average logging cost determined from the department of revenue small harvester forest excise tax return. A residual value approach is used to determine the value of species in the easement which are not present in the harvest area. The initial log prices are based on the price report that corresponds to the date of the forest practices application.

(3) Reduced valuation.

(a) For an easement that allows one or more harvests of qualifying timber during the term of the easement, a reduced valuation rate will be applied to the values obtained using either method in subsection (2) of this section. The reduced rate adjusts the values for reserve and replacement qualifying timber. The rate is based on the proportionate economic value lost to the small forest landowner from the regulatory requirements and adjusted for future harvest options during the term of the easement.

(b) The value of the qualifying timber that may be harvested during the term of the easement will be reduced based on the following formula:

Reduced valuation rate = 1 - 1
(1+l)N
1- 1
(1+l)50
Where:
l -- is the rate of return on 30 year treasury bills, as reported by the Federal Reserve Statistical Release H15 less the rate of increase in the Consumer Price Index for all Urban Consumers as published by the U.S. Department of Labor Bureau of Labor Statistics for the previous 12 months less the anticipated rate of growth expected on the portion of the easement subject to reentry, but not less than zero or greater than 6 percent.
N -- is the number of years when the landowner is scheduled to re-enter the property.

(c) The reduced rate will not be applied to the department of revenue tax data values if the landowner does not intend to re-enter the easement area during the length of the 50 year easement.

(d) The small forest landowner advisory committee will review the option for multiple payments during the permanent rule process.

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NEW SECTION
WAC 222-21-050
Payment of compensation.

(1) The compensation offered to the small forest landowner will be 50% of the fair market value of the qualifying timber established under the process described in WAC 222-21-045, subject to the following exceptions:

(a) If the high impact regulatory threshold is exceeded for an area covered by an approved forest practices application, then the compensation offered will be increased to 100% for the value of the qualifying timber where the high impact regulatory threshold is exceeded. Use the following calculation:


Compensation for easement = (HIE% * V) + (((100% -HIE%) / 2) * V)
Where:
HIE = Vq / TV * 100 -t;
TV = Vq + Vh;
Vq = value of qualifying timber;
Vh = value of harvested timber; and
t = high impact regulatory threshold.

(b) All compensation is subject to available funding.

(2) If funding is not available, the small forest landowner office will maintain a priority list for compensation based on the date of receipt of forest practices applications covered by forestry riparian easement applications.

(3) The small forest landowner office will send the small forest landowner a notice of compensation decision within 60 days of completion of the timber cruise.

(4) Compensation will not be paid until:

(a) The department has documented completion of harvest;

(b) The department has verified that there has been compliance with the rules requiring leave trees in the easement area;

(c) Any dispute over the amount of compensation or eligibility or other matter involving the forestry riparian easement has been resolved; and

(d) The forestry riparian easement has been executed and delivered to the department.

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NEW SECTION
WAC 222-21-060
Commercially reasonable harvest.

The small forest landowner office will use the following criteria to determine if an area covered by a forest practices application involves a commercially reasonable harvest. The proposed harvest must meet all of the following requirements:

(1) The harvest unit includes or borders a riparian area;

(2) The application is for a Class III or Class IV Special forest practice or a Class II that is a renewal of a Class III or Class IV Special;

(3) The harvest is not a Class IV General conversion or covered by a conversion option harvest plan;

(4) The landowner is not eligible for the 20 acre exemption under WAC 222-30-023;

(5) The value of the timber in the harvest unit, excluding qualifying timber, is equal to or exceeds the minimum required by department of revenue for taxing purposes ($1000); and

(6) The taxable harvest equals or exceeds the value of the qualifying timber established under WAC 222-21-045, unless otherwise approved by the small forest landowner office. (See the board manual.)

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NEW SECTION
WAC 222-21-065
Uneconomic to harvest.

The small forest landowner office will use the following criteria to determine whether timber is qualifying timber because it is rendered uneconomic to harvest by rules adopted under RCW 76.09.055 or 76.09.370:

(1) The timber could have been included in a commercially reasonable harvest unit by the small forest landowner if there were no additional requirements imposed by rules adopted under RCW 76.09.055 or 76.09.370.

(2) The area is not reasonably accessible because of requirements imposed by rules adopted under RCW 76.09.055 or 76.09.370.

(3) The unit must have no reasonable unit size alternative which if used would make the area economical to harvest.

(4) The cost to access the harvest unit plus the cost to harvest must equal or exceed 35% of the stumpage value in the portion of the unit considered to be uneconomic. The small forest landowner office will determine costs and values consistent with WAC 222-21-045. Costs include harvest, construction of nonpermanent roads and/or water crossing structures, and associated expenses.

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NEW SECTION
WAC 222-21-070
Blowdown and salvage.

After execution of a forestry riparian easement, qualifying timber may not be salvaged, including removal of blowdown, without prior written permission from the department. Prior to removal, the small forest landowner office and the small forest landowner must negotiate the terms of removal and reimbursement to the state, if any. Qualifying timber that blows down off the easement premises that presents a nuisance may be moved back onto the easement premises without permission from the department.

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NEW SECTION
WAC 222-21-080
Eminent domain.

If a forestry riparian easement is taken, in whole or in part, by exercise of the power of eminent domain, or acquired by purchase in lieu of condemnation, the department and the small forest landowner will share any compensation based on the then present value of parties' relative interests in the qualifying timber. The state's proportional share will be calculated based on the following formula:


State's share = 1 - 1
(1+l)R
.5 x
1 - 1
(1+l)50
Where:
l -- is the rate of return on 30 year treasury bills, as reported by the Federal Reserve Statistical Release H15 less the rate of increase in the Consumer Price Index for all Urban Consumers as published by the U.S. Department of Labor Bureau of Labor Statistics for the previous 12 months, but not less than zero or greater than 6 percent;
R -- is the number of years remaining on the easement.

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NEW SECTION
WAC 222-21-090
Internal department of natural resources review of small forest landowner office compensation decisions.

Within 30 days after the date of the notice of compensation decision, the small forest landowner may submit a written request for review to the supervisor of the department or his or her designee. The request for review must identify the issue being raised and provide any supporting documentation. The supervisor will issue a written response within 30 days.

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Washington State Code Reviser's Office