Rule-Making Notices (Hearing Notices)

Eliminate the requirement that offers for plan writing services must be in writing and guarantee that plans are submitted for the following July 1 deadline in NR 46.18(7)(c):

Management plans that are submitted for the July 1 petition deadline without a management plan or indicating a certified plan writer are placed on a management plan referral list. Certified plan writers are given the opportunity to offer plan writing services to landowners.

NR 46.18 (7) (c) provided that certified plan writers must submit their offers in writing and include the cost for the management plan preparation service and guarantee that an approvable plan will be completed by the following July 1. The department does not require that it receive a copy of the offer, only that a certified plan writer report that an offer has been made within 5 days of the offer under NR 46.18(7)(d).

The managed forest law statutes and administrative codes establish the eligibility and management provisions of the program, but do not establish the business practices of certified plan writers in working with private landowners. Additionally, the cooperating forester agreement (note: certified plan writers must also be a cooperating forester) states that cooperating foresters have sole control over the methods, hours worked, and time and manner of any performance under the agreement other than as expressly required by the Cooperative Agreement.

Because the department has no mechanism to insure that written offers are provided to landowners, and because the department does not direct the business practices of certified plan writers, NR 46.18(7)(c) this provision will be removed from administrative code.

Amendment of the format in which the department charges landowners for plan writing services in NR 46.18(8)(b).

The department must charge landowners a plan preparation fee that includes a base rate and a rate per acre. Changes to NR 46.165 (4) (f) to eliminate the requirement to submit a base rate per plan will require the department's billing procedure to also change. Changes to NR 46.18 (8) (b) will eliminate the base rate per plan.

Comparison of federal regulations

There are no known federal rules which apply to stumpage rates or Managed Forest Law petitions.

Comparison of rules in adjacent states

Checks with the surrounding states of Minnesota, Michigan, Iowa and Illinois indicate that while they offer some type of incentive program to forest landowners, none of the states have similar forestry practice requirements nor do they calculate annual stumpage rates for severance and yield taxes in conjunction with their programs.

Anticipated cost by private sector

For owners of land designated as managed forest law or forest crop law, there is an anticipated decrease in cost associated with the decrease in yield tax on managed forest law lands and severance tax on forest crop law lands based on the average decrease in stumpage rates proposed for both pulpwood (4% decrease) and sawlogs (3% decrease). Actual cost could be an increase or decrease depending on the specific species, product and zone.

For owners who qualify for the exemption of payment of the forest crop law termination tax, an estimated $3,000 will be saved by the owner. The estimated savings of $3,000 is based upon an average termination tax paid by owners in FY 2009. There will likely be one landowner per year who will qualify for this exemption.

Changes associated with submitting and approving management plans prepared by certified plan writers and DNR foresters will have no fiscal effect and allow additional time for plans to be written and approved.

Summary of factual data and analytical methodologies

Stumpage rate data is collected from Department Foresters and Cooperating Foresters annually. This data is used to calculate a three year weighted average for each species and product by zone. Only data obtained from private timber sales was used in the stumpage rate calculation.

wtd avg current year minus 3 stumpage value	wtd avg current year minus 2 stumpage value	wtd avg current year minus 1 stumpage value	wtd avg current year minus 1 stumpage value
_________________________________________________________________________________ # of years wtd avg stumpage values
____________________________________________________________________ = Stumpage Rate 2
(if there is a wtd avg current year minus 1 stumpage value, otherwise it's 1)

The current rates in NR 46.30 were compared to the proposed rates to determine the average change in rates by product.

Analysis and documentation used to determine effect on small business

A review of the law shows the impact on small business. The actual impact is dependant on the amount of timber (if any) is scheduled to be harvested on their specific land during this stumpage rate year and on the expected number of additions.

Small Business Impact

This rule will impact small businesses (i.e., farmers, landowners) that have land designated as managed forest land or forest crop land. Those involved in this voluntary program pay a reduced tax in place of the regular property tax in exchange for sound forest management on the land. When timber is harvested they pay a 5% yield tax or 10% severance tax, which is calculated using the stumpage rates established in NR 46.30. At the time of entry into these programs the owner pays for the preparation of a management plan, which includes sound forest management practices that must be completed during the order period to ensure and maintain a healthy stand of timber.

Initial regulatory flexibility analysis

Pursuant to s. 227.114, Stats., the proposed rule may have an impact on small businesses. The initial regulatory flexibility analysis is as follows:

a. Types of small businesses affected:

Any business with land enrolled in either the Managed Forest Law or the Forest Crop Law or wishing to enroll land under the Managed Forest Law.

b. Description of reporting or bookkeeping procedures required:

No procedures not already required.

c. Description of professional skills required:

No new skills are required.

Small business regulatory coordinator

The Department's Small Business Regulatory Coordinator for this rule may be contacted at quinn.williams@ wisconsin.gov or by calling [phone].

Environmental Analysis

The Department has made a preliminary determination that this action does not involve significant adverse environmental effects and does not need an environmental analysis under ch. NR 150, Wis. Adm. Code. However, based on the comments received, the Department may prepare an environmental analysis before proceeding with the proposal. This environmental review document would summarize the Department's consideration of the impacts of the proposal and reasonable alternatives.

Fiscal Estimate

Assumptions used in arriving at fiscal estimate

This proposed rule change addresses the annual stumpage rate changes used in the calculation of severance and yield tax collections under Forest Cop Law (FCL) and Managed Forest Law (MFL) when timber is harvested from the private lands enrolled in the programs.

Revenues to local municipalities will decrease due to a decrease in the average stumpage value for sawlogs, pulpwood, mixed products and piece products. Timber prices have steadily fallen throughout the past year, although overall prices did not fall as significantly as what was observed a year earlier. The average statewide prices for sawlogs have decreased 3%, with a range of a 13% increase to a 34% decrease. The average statewide prices for pulpwood have decreased 4%, with a range of a 16% increase to a 20% decrease. The average statewide prices for mixed products (mixture of sawlogs and pulpwood for red pine, white pine and spruce) have decreased 3%, with a range of a 32% increase to a 21% decrease. Lastly, the average statewide prices for piece products (posts, poles, and Christmas trees) have increased 1%, with a range of a 4% increase to a 1% decrease.

While the statewide stumpage rates decreased slightly, there are fluctuations between market zones and individual prices. Of the total 630 prices calculated, 149 (24%) increased, 198 (31%) decreased, and 283 (45%) stayed the same.

The severance and yield taxes collected in CY 2009 were $1,284,934. This is 26% less than the severance and yield taxes collected in CY 2008. Timber harvest volumes have also changed since CY 2008 in the following manner: pulpwood volumes decreased 17%, fuelwood volumes increased 97%, sawlog volumes decreased 20%, mixed products volumes increased 106%, and piece products volumes decreased 2%.

To estimate the fiscal impact of stumpage rate changes, the Department assumes that overall timber harvest volumes remain the same in CY 2011 as they were in CY 2009. Because of offsetting increases and decreases in timber sale revenues based on differences in market zone, wood classification, harvest volume and timber prices, the Department estimates that a net total of $1,500 less in yield and severance taxes will be collected as a result of the rate changes, which equates to a net decrease of less than 1% of revenues for local municipalities.

Amendments to the minimum medium density of plantations will have no state or local fiscal effect. The change will relieve some landowners of replanting plantations if the survival rate is 400 well-spaced tree seedlings per acre.

Procedure and process clarifications for additions of land to existing managed forest law, the provisions for certified plan writers to submit management plan preparation fee data, the removal the conditions of a written offer, and the Department's billing process will have no state or local fiscal impact.

State fiscal effect

Decrease existing revenues.

Local government fiscal effect

Mandatory decrease in revenues.

Types of local governmental units affected

Towns, Villages, Cities, Counties.

Fund sources affected

SEG.

Agency Contact Person

Kathryn J. Nelson, Forest Tax Policy Chief

Phone: [phone]

Email: [e-mail]

Notice of Hearings

Natural Resources

Environmental Protection — General, Chs. NR 100—
Environmental Protection — WPDES, Chs. NR 200—

rulemaking_notices CR 10-035 CR 10-035

NOTICE IS HEREBY GIVEN THAT pursuant to ss. 227.11 (2) (a), 281.15, 283.001 (2), 283.13 (5), 283.15, 283.31, 283.35 and 283.37, Stats., the Department of Natural Resources will hold public hearings on proposed revisions to Chapters NR 102 and 217, Wis. Adm. Code, relating to phosphorus water quality standards criteria and limitations and effluent standards.

Hearing Information

The hearings will be held on:

April 15, 2010 at 1:00 p.m.	Quality Inn 668 W. Kemp Street Rhinelander
April 20, 2010 at 1:00 p.m.	Green Bay City Hall Council Chambers, Room 203 100 N. Jefferson Street Green Bay
April 21, 2010 at 1:00 p.m.	Olympia Resort and Conf. Center Crown Room 1350 Royale Mile Road Oconomowoc
April 27, 2010 at 1:00 p.m.	Ramada Inn, Lower Ballroom 205 S. Barstow Street Eau Claire

Pursuant to the Americans with Disabilities Act, reasonable accommodations, including the provision of information material in an alternative format, will be provided to qualified individuals with disabilities upon request. Please call Jim Baumann at [phone] with specific information on your request at least 10 days before the date of the scheduled hearing.

Copies of Proposed Rule and Submission of Written Comments

The proposed rule revisions and supporting documents, including the fiscal estimate may be viewed and downloaded and comments electronically submitted at the following internet site: https://health.wisconsin.gov/admrules/public/ Home.

Written comments on the proposed rules may be submitted via U. S. mail to Jim Baumann, DNR-WT/3, P.O. Box 7921, Madison, WI 53707-7921 or by e-mail to [e-mail]. Comments may be submitted until April 30, 2010. Written comments whether submitted electronically or by U. S. mail will have the same weight and effect as oral statements presented at the public hearings. If you do not have internet access, a personal copy of the proposed rules and supporting documents, including the fiscal estimate may be obtained from Jim Baumann, DNR-WT/3, P.O. Box 7921, Madison, WI 53707-7921, or by calling [phone].

Analysis Prepared by Department of Natural Resources

Statutes interpreted

Sections 281.15, 283.13 (5), 283.31, 283.55 and 283.84, Stats.

Statutory authority

Sections 227.11 (2) (a), 281.15, 283.001 (2), 283.13 (5), 283.15, 283.31, 283.35 and 283.37, Stats.

Related statute or rule

Section 283.11 (3) (am), Stats.

Chapters NR 106 and 200, Wis. Adm. Code

Plain language analysis of the rule

The proposed rule has two parts. The first is a set of phosphorus water quality standards criteria for rivers, streams, various types of lakes, reservoirs and Great Lakes. The second is procedures for determining and incorporating phosphorus water quality based effluent limitations into Wisconsin Discharge Pollutant Elimination System (WPDES) permits under chapter 283, Stats. Pursuant to 40 CFR 131.11, states are required to adopt water quality standards criteria that are protective of the designated uses of surface waters. Pursuant to section 303(c)(4) of the Clean Water Act, EPA may step in and promulgate the criteria for the state, if the state does not. Development of point source permit procedures is required as part of the state's point source permit delegation agreement. EPA approval of state water quality criteria is required under 40 CFR ss. 131.5, 131.6 and 131.21.

Phosphorus Water Quality Standards Criteria

The proposed rule establishes phosphorus water quality criteria of 100 ug/l (parts per billion) for rivers specifically identified in the rule and of 75 ug/l for smaller streams and rivers. No criteria are proposed at this time for ephemeral streams or streams identified in ch. NR 104, Wis. Adm. Code as limited aquatic life waters. Both of the criteria are intended to prevent in-stream algae and other plant growth to the extent that is detrimental to fish and aquatic life. For example, extensive algae or macrophyte (large plants growing on the beds of streams) consume oxygen during the night to the extent that may leave too little oxygen for certain fish species and for certain aquatic insects. About half of Wisconsin's rivers and streams meet the proposed criteria.

For lakes and reservoirs, the proposed rule has a suite of criteria for five different types of lake ranging from 15 ug/l for lakes supporting a coldwater fishery, such as lake trout or cisco in its bottom waters, to 40 ug/l for shallow drainage lakes and reservoirs. The criteria are intended to prevent or minimize nuisance algal blooms; prevent shifts in plant species in shallow lakes; maintain adequate dissolved oxygen in the bottom of “two-story" lakes with a warmwater fishery in top waters and coldwater fisheries in bottom waters; and to maintain fisheries. “Toxic" algae concerns may also be addressed. For millponds and similar impoundments, the upstream river or stream criteria would apply. More than half of Wisconsin's lakes meet the proposed criteria with the percent varying by lake type. No criteria are proposed at this time for marsh lakes and other wetlands since they will be part of future wetlands nutrient criteria adoption.

For the Great Lakes, phosphorus criteria are proposed for the open waters of Lake Superior (5 ug/l), the open waters of Lake Michigan (7 ug/l) and the nearshore waters of Lake Michigan (7 ug/l). Presently, for the open waters both Lake Michigan and Lake Superior are meeting the criteria. For the nearshore waters of Lake Michigan, the zone from the beaches to a depth of 10 meters, where there are concerns with the Cladophora algal mats forming on beaches, the criteria may be exceeded in some locations.

Below is a table showing the proposed phosphorus water quality standards criteria by type of water body. The specific water body types are defined in the proposed rules, and there are some exclusions based on size or flow conditions.

Proposed Phosphorus Criteria by Type of Water Body	Total Phosphorus in ug/l
Listed rivers	100
All other streams	75
Stratified reservoirs	30
Non-stratified reservoirs	40
Stratified “two-story" fishery lakes	15
Stratified drainage lakes	30
Non-stratified (shallow) drainage lakes	40
Stratified seepage lakes	20
Non-stratified (shallow) lakes	40
Impoundments	Same as inflowing river or stream
Lake Michigan open and nearshore waters	7
Lake Superior open and nearshore waters	5

WPDES Effluent Standards and Limitations

The current regulations for phosphorus establish specific procedures for including technology based limitations and standards in WPDES permits (existing chapter NR 217). There is also an existing rule (s. NR 102.06) that generally states the department may establish water quality based limits for phosphorus in permits on a case-by-case basis using an evaluation of phosphorus sources in a watershed, but this rule is being repealed and replaced with a proposed new subchapter in chapter NR 217 that includes detailed procedures for establishing water quality effluent limitations for phosphorus.

Specifically, there are provisions for determining when a water quality based effluent limitation is needed in a WPDES permit; equations and procedures for calculating effluent limits based on different types of waters and stream flow assumptions; and provisions for expressing permit compliance averaging periods, such as a monthly average. The rule requires concentration limits, as commonly used in permits. However, it also specifies where and how mass limits are required, such as for discharges to impaired waters, where there is a downstream lake and where there is a downstream outstanding or exceptional resource water. The rule also addresses the relationship and procedures for including a various types of phosphorus limits in permits such as a phosphorus limit based on a total maximum daily load, a technology based phosphorus limit and a water quality based phosphorus limit calculated under the new procedures in chapter NR 217.

The proposed rule allows the department to include compliance schedules in permits. The compliance schedule provisions specify factors the department may consider when establishing the length of a compliance schedule. One of the options for a compliance schedule provision for discharges to nonpoint source dominated waters includes an adaptive management option where interim limits may be phased in, if phosphorus concentrations improve in the receiving water.

There are also provisions for a streamlined approach for processing variances for stabilization pond and lagoon systems that mimic the procedures for ammonia variances in ch. NR 106. These special provisions are based on the knowledge that presently there are few means to control phosphorus being discharged from these systems and that the construction of a mechanical plant is not affordable for smaller municipalities. The inclusion of streamlined procedures for stabilization pond and lagoon systems should not be interpreted to mean that these are the only systems that may obtain a variance, where appropriate. There are standard procedures for variances in statutory language and other administrative codes.

Comparison with federal regulations

The proposed phosphorus criteria for streams of 75 ug/l and rivers of 100 ug/l are similar to EPA's guidance values for the southern half of Wisconsin. EPA recommended 70 ug/l of phosphorus for both rivers and streams in the southwestern driftless area of the state and 80 ug/l of phosphorus for both rivers and streams in the remainder of the southern half of the state. EPA, did however, recommend a criterion of 29 ug/l for a band or area stretching west to east though the middle of the state and 10 ug/l for the forested northern part of the state. All of the EPA guidance numbers are based on the 25th percentile of available data from a number of states and do not represent a cause-effect situation. We could not find concentrations as low at 10 ug/l even for pristine conditions in most of the forested northern portion of Wisconsin.

For lakes, the proposed criteria that range from 15 to 40 ug/l based on the type of lake are different than EPA's guidance values that range from 9.7 ug/l for northern lakes to 36 ug/l for driftless area lakes. EPA's guidance values are based on data from multiple states and represent the 25th percentile of available data. They do not differentiate based on the type of lake.