Cabin Fee Act (CFA) Summary National Forest Homeowners Doug Gann, NFH Director 2016 Fall Forum - Twin Cities, MN - September 17, 2016
FEE TABLE SUMMARY Tier No. of Permit Tier Size Permits Fee 1 6% 834 $650 2 16% 2,224 $1,150 3 26% 3,614 $1,650 4 22% 3,058 $2,150 5 10% 1,390 $2,650 6 5% 695 $3,150 7 5% 695 $3,650 8 3% 417 $4,150 9 3% 417 $4,650 10 3% 417 $5,150 11 1% 139 $5,650 Total 100% 13,900 $2,205 11 Annual Fee Tiers $650 - $5,650 Annual Fee Range 70% of fees < Avg Fee 30% of fees > Avg Fee $1,200 Transfer Fee new permit issued due to change of cabin ownership Temporary Fee waiver/reduction for impaired access or occupancy USFS Fee retention after 10 years USFS Review & Report to Congress after 10 years
Appraisal Value Normalize Value Rank Values Assign to Tiers by Ranking % Recent Appraisal Cycle (2006-2012) Approved 2 nd Appraisal Adjust for time to 2012 Account for changes in RE Market From lowest to highest normalized value Relative Ranking from 0% to 100% Lowest 6% = Tier-1 Highest 1% = Tier-11 See fee table
Housing Opportunity Index National Median Price Normalization of Approved CUFFA Appraisals $300.0 Beginning (1.32) $250.0 End (1.00) $200.0 $150.0 $100.0 $50.0 $0.0 I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV 2006 2007 2008 2009 2010 2011 2012 2013 2014 Appraisal Dates of Value (Year-Quarter)
Appraisal Value = $80,000 Normalized Value = $83,511 Relative Ranking = 91.5% Assign to Tier-8 1 st Appraisal = $130,000 2 nd Appraisal = $80,000 Date of Value = 9/11/2010 Adjustment Factor for 2010 Q3 =.9580 $80,000 /.9580 = $83,511 $83,511 = 91.5% of all normalized values Tier-8 = 90% - 93% 91.5% = Tier-8 $4,150 Fee Tier Size of Permits Fee From To 1 6% 834 $650 0% 6% 2 16% 2,224 $1,150 6% 22% 3 26% 3,614 $1,650 22% 48% 4 22% 3,058 $2,150 48% 70% 5 10% 1,390 $2,650 70% 80% 6 5% 695 $3,150 80% 85% 7 5% 695 $3,650 85% 90% 8 3% 417 $4,150 90% 93% 9 3% 417 $4,650 93% 96% 10 3% 417 $5,150 96% 99% 11 1% 139 $5,650 99% 100% Total 100% 13,900 $2,205
A $1,200 transfer fee is required whenever a new recreation residence special use permit is issued due to a change of ownership. Changing the name on a permit triggers scrutiny for a transfer fee. The Transfer Fee Applies When. Sale of cabin to related or unrelated Party Gift or inheritance Married couple divorces and removes spouse s name from permit Current owner marries and wishes to add spouse s name Current owner places cabin into a USFS approved trust
The Transfer Fee Does Not Apply When. Permit expires & is reissued to same party. Legal name change (no change of ownership). From existing co-owner to another existing co-owner (may require documentation of current ownership). Current owner marries, but does not add spouse s name Permit held by married couple and re-issued in surviving spouse s name only, upon death of the other spouse. If Authorization is held in a USFS approved cabin trust and trust beneficiary names change, as long as, trustee s name does not.
CFA fee table used to reset permit base fees for 2016 2016 Permit Fee Billing is complete Very few errors reported USFS promptly corrected Future fees increase by inflation only increase allowed Update Permit Document Remove references to CUFFA appraisals and insert CFA language Permit amendments to be sent to existing permit holders Revised permit language for all new permits issued Publish Rules & Regulations Update USFS Handbook & USFS Manual Transfer fee rules Reduced or waived fees for temporary impaired access or occupancy
The new CFA law holds true to the NFH guiding principles for a new fee system. Preserves the cabin program, no cabin loss due to high fees. Stable and Predictable fees, increased only by inflation, not by changes in the real estate market or a flawed appraisal system. Strengthened cabin values for all, and the return of cabin marketability where it was lost due to high fees. The elimination of cumbersome and expensive appraisals, reducing costs for the FS & cabin owners alike. Simplicity and Longevity..will withstand the test of time. Strengthened relationships with the USFS with fee retention. Peace and enjoyment of the simple cabin life once again.
The CFA does not roll back fees to pre-2008 levels The average fee under CUFFA increased over 100% from 2008 to 2014. The CFA resulted in a lower average fee in 2016, however, the ~10% reduction of average fee does not reverse the 2008-2014 increase. While the vast majority of cabin owners believe CFA fees are more fair, there remain a few examples of permit fees that may not appear to be reasonable compared to others. The use of imperfect appraisal values for CFA fee Tier placement is the primary cause of this issue. While the CFA results in a range of fees supported by the market, there is no assurance the existing cabin owner is able or willing to pay the new fee level. This is the same as occurred in past fee increase cycles in the 1980 s, 1990 s, etc.
THANK YOU! For your feedback, legislative contacts, and financial support. Have Questions? Come to CFA Roundtable