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Proposal 4 -Income Tax Deductions for Revenue from Lands Managed to <br />Supuort Endangered Species. <br />Description: Revenues derived from economic activity on lands that are managed <br />to fully support endangered, threatened, and candidate species would be deduct- <br />ible from the taxable earnings that qualify for federal income taxation. Examples <br />of endangered species-compatible economic activity could include: <br />1) Radically modified timber management programs where the full <br />ecological integrity of endangered species habitat was maintained during <br />all aspects of the growth, harvest and reforestation cycles. Meeting the <br />compatibility criteria might easily mean that as little as 10 percent or 15 <br />percent of the marketable timber could be harvested, and that use of <br />herbicides and heavy mechanized equipment was sharply limited; <br />2) Substantially modified grazing or agricultural programs that sustained <br />native biotic communities and ecosystems along with non-native livestock <br />or crops; <br />3) Housing developments that were designed to incorporate and retain <br />sensitive habitats; or <br />4) Privately managed recreation and hunting lands where fees were <br />collected for wildlife viewing, recreation, or hunting access. <br />Stipulations: The qualifying economic activities would have to be fully compat- <br />ible with the long-term survival of extant or recovering endangered species <br />populations and have no significant, long-term negative effect on such popula- <br />tions or on the biological integrity of the ecosystems supporting such populations. <br />Only those revenues stemming from economic activity on lands directly support- <br />ing endangered, threatened or candidate species habitat would be eligible. These <br />qualifying activities would need to be described in an Endangered Species Com- <br />patibility Plan, which would include a land and habitat management component. <br />The plans could operate on a long-term basis (say, 50 years, or so), and would <br />include substantial penalties, equal to the tax benefits received, in case of termina- <br />tion or conversion to non-compatible land uses. Revenues from one-time sales, as <br />characterized by housing developments, would need to be considered differently <br />(i.e., at a lower rate of deduction) than revenues from continuing operations. The <br />qualifying standards for this incentive program would have to be stringent to <br />ensure compatibility with the strict criteria required to maintain the long-term <br />biological integrity of the involved ecosystems. <br />Rationale: No significant economic incentives for private land owners exist that <br />reach the structural core of economic decision making. The key to the perpetual <br />health and preservation of our biological resources lies in integrating habitat <br />needs with appropriately scaled and sustainable economic activities. Such appro- <br />9 <br />