North Carolina: Open-space bills lack key support
Friday, April 18, 2003
Raleigh, North Carolina - Environmentalists hope the General Assembly will protect wildlife and flood plains by expanding a program aimed at saving family farms, but they have yet to win support from two key groups: farmers and county officials.
Two bills in the Senate would provide property tax breaks to the owners of flood plains and to land managed for the protection of wildlife. The land would be eligible for a program created 30 years ago to shield farmers from rising property taxes by taxing their land at its lower agricultural value or "present-use value."
"We've decided that farming has a public purpose," said Dan Whittle, an attorney for Environmental Defense in Raleigh. "So why not recognize that open space does too?"
But the groups that have the biggest stake in the present-use system oppose broadening the program. Counties statewide lose tens of millions of dollars in tax revenue each year under the program, and county officials don't want those losses to increase. The program now allows landowners to avoid paying property taxes on nearly $12 billion worth of real estate statewide.
"We're always opposed to bills that would open up use value beyond who is entitled to it currently," said Paul Meyer, an attorney for the N.C. Association of County Commissioners. "As we whittle away at the tax base through this kind of stuff, the weight of the property tax burden gets dropped on the residential owner who doesn't have any exemptions."
Environmentalists who helped draft the wildlife bill hoped to win support from county officials by ensuring the changes wouldn't reduce tax receipts.
Owners who pull out of the system now must pay three years' back taxes at the property's full value, plus interest. The wildlife bill, introduced by Sen. Fletcher Hartsell of Concord, would change it to 10 years' back taxes. Not only would the larger penalty create more revenue for counties, but it would reduce the present-use rolls by discouraging speculators who simply plan to develop their property in a few years.
"We think it will have a neutral fiscal impact" on counties, said Whittle. "But we're willing to sit down and think that through."
The flood plain bill, introduced by Sen. Jeanne Lucas of Durham, would not change the penalty for pulling land out of the present-use program.
Farmers oppose the larger penalty. Peter Daniel of the North Carolina Farm Bureau said farmers have their wealth tied up in their land and larger tax penalties for selling some of it for house lots represents a real loss.
Daniel also said farmers don't want to undermine support for the present-use system by expanding it too much.
"Our overall concern is that access to present-use value could be made so broad that the counties just can't stand it," he said.
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