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Rule would allow former working farms to continue to receive tax break
Owners of properties that no longer meet the criteria of a working farm may be able to receive a portion of the annual property tax break many farms have long enjoyed, under a series of proposed changes to the county's open-space program.
On Oct. 19, the San Juan County Council took another step toward putting some if not all of those changes into law by agreeing that it would consider the revisions at a Nov. 30 public hearing.
More than a dozen property owners face substantial back taxes, interest and penalties because their properties fail to meet the criteria, as spelled out by state law, of the county's current use taxation program known as Farm and Agricultural Land. As many as 17, most of whom qualified at one time for a tax break by producing and selling agricultural products, have sought to enroll in a different open-space category — Farm and Agricultural Conservation Land — after being informed two years ago they were no longer eligible for the tax break allowed to working farms.
A property owner could receive 90 percent or more off his or her annual property tax bill, according to Assessor Charles Zalmanek, whose department monitors the county's open space program. In contrast, the maximum tax reduction allowed under the farmland "conservation" category would be 52 percent, Zalmanek said.
That's if anyone were able to qualify for such a reduction. But that's not the case, according to Deputy Civil Prosecutor Karen Vedder, because local farmland rarely had enough scenic or unique natural features to qualify for a tax break under the so-called public benefit ratings system, the lynchpin of the open space program, as it exists today.
That ratings system, which provides points under a predetermined set of features, such as a beach, a marsh, a vista or a stream, or a historic site or a buffer located beside a park or nature preserve, is used to calculate whether a parcel of land qualifies for the program and the amount of reduction its owner deserves for preserving and protecting them. Each point translates into a percentage off a property's annual tax assessment — as determined by its "highest and best" use — and at least 30 points are needed to qualify.
"It's highly unlikely any or all of these (17) properties would qualify," Vedder said. State law, she said, allows for property owners to switch between the two farmland categories without penalty even if the local program has obstacles that prevent it.
If approved, the changes that the council will consider would add new elements to the ratings system. Those changes, based largely on a proposal endorsed by the Planning Commission, would award 30-35 points to a five-plus acre parcel that has adequate soil for agricultural production, and that's listed under the county Comprehensive Plan as resource land or has potential of being subdivided.
The Planning Commission proposal allows for additional points for properties covered by a conservation easement that provides permanent public access, like a walking trail. It would also require a property owner to have a management plan and to put the land back into production, unless it's covered by an easement, and take it out of the "conservation" category after seven years.
In addition to the Planning Commission proposal, the council agreed it would consider adding a new section into the rating system that provides points for properties that have any of six so-called "priority habitats" as defined by the state Department of Fish and Wildlife. Developed by local biologist Terry Domico and backed by Friends of the San Juans, the priority habitat proposal would apply and award points only to that portion of a property in which a priority habitat exists.
AT A GLANCE
The number of parcels in open space and forest land in 2009.
— Open space: 724, totaling 17,522 acres (15.8 percent of county acreage).
— Designated forest land: 512, totaling 15,808 acres (14.3 percent of county acreage).
— Acres valued at fair market value: 16,586 parcels (52.4 percent of county acreage).
Source: San Juan County Assessor