The Shadow
LOW MOOR – Alleghany County plans to limit tax breaks it gives to some owners of rural undeveloped land.
Alleghany County operates under a system in which many rural residents get tax breaks for keeping agricultural, horticultural, forestry or open-space land undeveloped, as opposed to being taxed at fair-market value.
The tax breaks are provided under a 1971 Virginia law that was designed to counteract a decline in farming near urban and suburban areas. The program, called Use-Value Taxation, taxes property on what it produces instead of its market value. Alleghany County adopted a land-use ordinance, based on the 1971 law, in 1978.
In Alleghany County, there are currently 1,240 parcels enrolled in the land-use program, according to Commissioner of the Revenue Valerie Bruffey. Land-use exemptions are being granted to 687 taxpayers at a total cost of $557,173 to the county this year.
A breakdown of the parcels involved in the county’s land-use program includes 619 parcels (372 taxpayers) that claim some type of farm use. Bruffey said that according to the 2007 Census of Agriculture, there were only 209 farms in Alleghany County, with 71 having incomes of less than $1,000. In addition, 621 parcels in the county are enrolled under forest use. One parcel is enrolled under open space.
Bruffey said her office, with the support of the board of supervisors, plans to more stringently enforce requirements that property owners must meet to be granted land-use exemptions.
“I anticipate that some people are not going to qualify who have qualified in the past and that is going to be painful,” Bruffey told the board of supervisors Tuesday night.
Bruffey said some horse owners may lose their exemption because state law requires that the animals must be a part of a breeding or boarding business. Horses that are used exclusively for recreational purposes do not make the property eligible for a land-use exemption, she said.
State law requires that tax exemptions granted to agricultural and horticultural operations must involve at least five contiguous acres. The law also states that the property must have a previous five-year history of continuous farming or horticultural activity to qualify for a use exemption the sixth year. If the land is vacated for one year or more, the farm history must begin again for five consecutive years.
To qualify for a land-use exemption, the entire farm must have adequate livestock: One mature cow, five sheep, or five swine, 100 chickens and/or 66 turkeys per every five acres for 12 months. Croplands are qualified by adequate livestock or the basis of selling crops. Horticulture crops must be produced for commercial use to qualify for land-use taxation.
Property owners who are in land use under agricultural use of horticultural use must submit a copy of a Federal 1040 income tax schedule C, tax schedule E, Form 4835 or tax schedule F each year if requested by Bruffey’s office.
Her office may also request copies of tax returns to show the five-year history of continuous farming prior to being approved for land use. If a taxpayer cannot provide the required tax schedules, other documentation can be filed to prove that the land is being used for a legitimate farm operation. The documentation can include feed receipts, fertilizer receipts and receipts from the sale of crops and livestock.
Properties listed under forest use must be at least 20 acres in size. The land must be exclusively devoted to forest use and have no livestock access. Forest land with livestock access must qualify under the agricultural-use category. If land qualifies for a forest-use exception, no stepping or clear cutting is permitted unless guidance is provided by the Virginia Department of Forestry. A forest-use agreement may be required to be filed with the county.
Open-space land-use exemptions are granted to specific types of parks, historic lands and recreational areas.
Bruffey said golf courses qualify for open use. The category does not pertain to open, unused lands, however.
In a general reassessment year, new applications for land-use exemptions must be submitted to Bruffey’s office 30 days after a reassessment notice has been mailed. If a person purchases land that is already listed under land use, they will receive a letter from the county outlining procedures for continuation in the program. If acreage is sold from a tract that is under land use, the taxpayer is required to notify Bruffey’s office of the change in acreage. Taxpayers are also required to notify Bruffey within 60 days if changes in use of the land occur.
“At your next meeting, you will be asked to approve a resolution stating your support of the land-use program and my office’s efforts to make sure everything is done according to the law,” Bruffey told county supervisors Tuesday night.
Supervisors will next meet Dec. 4.
“This is not a local option. [The commissioner of the revenue] is just enforcing state law,” County Administrator John Strutner told supervisors.
