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raising or harvesting trees bearing fruit, nuts, or other crops
or ornamental trees.
1. Timber Cut on Land Owned by Petitioner or Its
Related Entities
A portion of petitioner’s business activities related to
cutting timber on land owned by petitioner or its related
entities. For this portion of petitioner’s business activity,
petitioner’s foresters examined tracts of land to cut, marked
trees to cut, and supervised cutting. The crews that cut the
trees were not employees of petitioner; they were employed by
corporations under contract to petitioner. The corporations
petitioner hired to cut the trees were either related entities
(such as Winn Logging, Inc.) or unrelated entities. Trucks and
other heavy equipment owned by or leased to petitioner
transported the cut logs to mills designated by petitioner.
2. Timber Purchase Arrangements With Unrelated Entities
A second business activity involved petitioner’s timber
purchase arrangements with unrelated entities that owned
woodland. Under these contracts, petitioner’s foresters (or the
landowner’s foresters) identified the merchantable timber and
oversaw the cutting crews. Petitioner’s trucks delivered the
logs to mills that petitioner had contractual arrangements with.
Petitioner used either one of two pricing arrangements under
these timber purchase contracts: (1) Fixed-price or lump-sum
arrangements; or (2) “pay-as-cut” or stumpage permits.
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Last modified: May 25, 2011