Committee approves SB701 to reclassify forestry equipment as Class 1 property and exempt sales tax; estimates $1.1M annual revenue loss
March 12, 2025 | 2025 Legislature WV, West Virginia
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The Senate Natural Resources Committee approved a committee substitute for Senate Bill 701 that would reclassify forestry equipment as Class 1 property for tax settlement purposes and exempt the sale of forestry equipment from the state sales and service tax under chapter 11, article 15, section 1. Counsel told the committee the committee substitute changes the effective date to July 1, 2025, and the fiscal material the committee received indicates a projected annual revenue decrease of roughly $1,100,000.
Supporters from the forestry sector testified in favor. Robert Boyles, representing the West Virginia Forestry Association, said the bill would correct an inconsistency in the tax code that excludes forestry from the agriculture classification despite forestry being treated as agriculture in other code provisions. Anthony Ranks of the Western Forestry Association described the industry's economic distress, listing recent mill closures and the broader decline in hardwood production. Ranks cited the closure of Allegheny Wood Products’ facilities in 2024—nine facilities and about 900 jobs lost—and said the closure of a single mill (the Kingwood sawmill) had an estimated $77 million annual economic impact to the state based on a West Virginia University study. He argued reclassification could help attract manufacturers and retain timber processing jobs inside state borders.
Committee members asked technical questions about the scope of the exemption (for example, whether small farm sawmills would qualify) and whether other states treat timber or forestry equipment as agricultural property; counsel said he was not aware of a cross-state comparison. The committee substitute was agreed to by voice vote and then moved to report the substitute to the full Senate with the recommendation that it do pass, first referred to the Finance Committee.
Committee discussion included acknowledgment that the committee substitute adds the sales tax exemption and clarifies the effective date. No roll-call tally was recorded in the transcript; the chair declared the ayes to have it.
Supporters from the forestry sector testified in favor. Robert Boyles, representing the West Virginia Forestry Association, said the bill would correct an inconsistency in the tax code that excludes forestry from the agriculture classification despite forestry being treated as agriculture in other code provisions. Anthony Ranks of the Western Forestry Association described the industry's economic distress, listing recent mill closures and the broader decline in hardwood production. Ranks cited the closure of Allegheny Wood Products’ facilities in 2024—nine facilities and about 900 jobs lost—and said the closure of a single mill (the Kingwood sawmill) had an estimated $77 million annual economic impact to the state based on a West Virginia University study. He argued reclassification could help attract manufacturers and retain timber processing jobs inside state borders.
Committee members asked technical questions about the scope of the exemption (for example, whether small farm sawmills would qualify) and whether other states treat timber or forestry equipment as agricultural property; counsel said he was not aware of a cross-state comparison. The committee substitute was agreed to by voice vote and then moved to report the substitute to the full Senate with the recommendation that it do pass, first referred to the Finance Committee.
Committee discussion included acknowledgment that the committee substitute adds the sales tax exemption and clarifies the effective date. No roll-call tally was recorded in the transcript; the chair declared the ayes to have it.
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