Kudos to Larry Spencer of Spirit Lake for bringing attention to the forestland tax exemption. This exemption not only reduces revenue to Kootenai County and other taxing districts but shifts the burden of property taxes between landowners. I have no doubt Silverwood Theme Park dotted the i's and crossed the t's for the forestland exemption and it's all perfectly legal. Perfectly legal because the Idaho Legislature created a tax exemption for forestland. It is a statute that allows parcels larger than 5 acres which are capable of growing trees to be assessed and taxed as timberland. Savvy property owners avoid higher taxes by claiming this exemption.

Here is one example to give you an idea of the enormous tax values involved. In a high-end platted subdivision along the Spokane River, the assessor valued a tract at $791,780. After the exemption, the taxable value is reduced to only $11,120. The kicker is the parcel is 5.0055 acres. That's right, it barely meets the minimum acreage requirement in the statute. Without the exemption, Kootenai County (2010 tax rates) would receive $2,328. Instead this parcel contributes only $33 to the Kootenai County budget. Add in the other taxing districts and this exemption is a windfall for the owner. And it's all perfectly legal!

How big a problem is this in Kootenai County? There are about 1750 parcels, less than 10 acres, in the county claiming the exemption. Some are waterfront properties.

These 1750 parcels represent a very substantial assessed value, perhaps as much as $150 million. Multiply that number by the Kootenai County tax rate and we are talking about a lot of tax revenue for the county coffers.

What can be done? The intent of the exemption was to protect viable economic timberland units from onerous property taxation. This has merit. However, I doubt 5 acres ever was or ever will be a viable, economic and manageable timberland unit. I believe 20 acres better fits the original intent and purpose of the statute. Given the change in land uses in recent years, disallowing the exemption in platted recreational and residential subdivisions is not only logical but appropriate. Since it is a state statute, the Legislature must revise the minimum acreage upward and exclude parcels in platted subdivisions.

Of the 1750 10- to 5-acre parcels, about a quarter to one-third are owned by individuals, investors and trusts outside of Idaho. This is a giant tax break for nonresidents.

With revenues tight, this may be a good time for Kootenai County commissioners to address this issue with our state legislators and have the statute better reflect current conditions. Perhaps other taxing districts could join the effort.

Fred Ebel is a Post Falls resident.