HB4483: Relating to establishing term limits to certain real property interests and registration requirements associated with carbon offset agreements

Legislative Summary

The purpose of this bill is to balance the interests of current landowners and future landowners to ensure forest land may be developed for future economic gain by limiting use restrictions for forest carbon capture and sequestration to a maximum term of 30 years. The bill defines certain terms. The bill requires parties to current and new carbon offset agreements to register with the State Tax Department for tax years beginning on and after January 1, 2022, and retroactive to such date. The bill requires reports by Division of Forestry. The bill authorizes the disclosure of information by the Tax Commissioner to Division of Forestry. The bill imposes excise tax on receipts derived from carbon offset agreements. The bill sets forth reporting requirements. The bill provides an effective date of January 1, 2022, and with retroactive effect to such date. The bill defines “managed timberland” to exclude timberland that is subject to a carbon offset agreement. The bill specifies application of West Virginia Tax Procedure and Administration Act and West Virginia Tax Crimes and Penalties Act. The bill authorizes promulgation of rules. The bill provides legislative findings and declarations. The bill provides that any covenant, restriction, condition, easement, contract, lease, deed, agreement, option, or other governing document, which is executed or recorded after the effective date, which effectively prohibits or restricts the development of land and the harvesting of timber from forests for the purposes of forest carbon capture, carbon offset, and carbon sequestration is void and unenforceable, unless said covenant, restriction, condition, easement, contract, lease, deed, agreement, option, or other governing document is for a maximum term of 30 years. The bill provides that options to renew or continue such arrangements beyond the maximum term of 30 years shall be valid only if the consideration is required to be renegotiated to exercise the option.