EQUITABLE AGRICULTURE TAXESWHEREAS, the Garden State’s high quality of life depends to a great extent on maintaining our diverse agricultural industry, and agriculture is an important contributor to New Jersey’s economic vitality, employing thousands of people in a variety of careers on and off the farm; and
WHEREAS, privately owned farmland and woodland account for one million acres of land, over 21 percent of the State’s land area, on which taxes are paid to support school districts, county government and municipal budgets; and
WHEREAS, in 1963, New Jersey voters approved a constitutional amendment that permitted farmland to be assessed and taxed based on the agricultural productivity of the land; and
WHEREAS, today, farmland assessment continues to be one of the single most important public policies in keeping agriculture, and all its positive environmental, economic and aesthetic attributes, alive and well in this, the most densely populated state in the nation; and
WHEREAS, the Farmland Assessment Act established the implementation program for farmland and woodland to be assessed at its agricultural or horticultural value; and
WHEREAS, farmland assessment does not forgive taxes; rather, the Act permits assessments on qualified land to be in line with net income from the land, allowing the farmland owner the opportunity to pay local taxes based on the productive capacity of the land devoted to agricultural or horticultural production; and
WHEREAS, the Farmland Assessment Act deals with the assessed value of land, but does not affect the assessed value of improvements; therefore, the farm dwelling, land associated with the farm dwelling, and farm structures such as barns, farm markets, packaging and processing structures, and equine facilities are assessed and taxed at the same level, market value, as other non-farm real estate; and
WHEREAS, while the State Farmland Evaluation Advisory Committee annually establishes productivity values for farmland and woodland for use by local assessors in assessing qualified farmland, it is important to note that New Jersey farmers continue to pay the second highest property taxes in the nation, nine times higher than the national average, even with farmland assessment; and
WHEREAS, the Farmland Assessment Act also provides for a levy of rollback tax if the use of the land changes from agriculture or horticulture; as a result, any qualified land that changes from an eligible agricultural or horticultural use to some other non-farm use, which includes the abandonment of agricultural activity, is subject to rollback taxes; and
WHEREAS, the rollback tax liability is for the year in which the change takes place, and for each of the two tax years immediately preceding in which the land was valued, assessed and taxed under the Act; and
WHEREAS, the liability for rollback taxes attaches to the land at the time a change in use of the land occurs, but not when a change in ownership takes place, if the new owner continues to maintain the land in an active agricultural or horticultural use in conformity with the requirements of the Act; and
WHEREAS, periodically, certain provisions of the Farmland Assessment Act have been questioned and come under the scrutiny of legislators and other policymakers, as occurred in recent recommendations by the Joint Legislative Committee on Constitutional Reform and Citizens’ Property Tax Constitutional Convention, wherein the idea of extending the rollback period to seven (7) years was proposed; and
WHEREAS, if the rollback period were lengthened, such a change would be tantamount to a reduction in the value of the land. The impact of lengthening the rollback period would mean that sizable acreage would go out of agriculture because any increase in the length of the rollback period would adversely impact the ability to remain in farming and retain farmland. For many farmers the ability to remain in agriculture stems not only from current financial returns, but also from increasing the value of their farmland; and
WHEREAS, in order to develop objective information on the program’s basic qualification criteria, the New Jersey Department of Agriculture commissioned a study by Cook College, Rutgers University; and
WHEREAS, the study, issued in January 1999, provided objective, quantitative information regarding possible impacts resulting form changes to the program’s qualification criteria; however, the study did not provide any recommendations concerning its findings; and
WHEREAS, to fully evaluate the economic analysis and findings of the Cook College report and to develop recommendations, a Farmland Assessment Review Committee was created by the New Jersey Department of Agriculture; and
WHEREAS, in the Recommendations of the Farmland Assessment Review committee prepared in March 2001, the Committee looked at the findings of the May 4, 1999 study Farmland Assessment in New Jersey: Effects of Revisions in Eligibility Requirements on Land Use, Open Space and Municipal Finance and strongly recommended that the current minimum acreage, rollback, and revenue requirement remain unchanged.
NOW THEREFORE BE IT RESOVLED, that we, the delegates to the 92nd State Agricultural Convention, assembled in Atlantic City, New Jersey, on February 14, 2007, reaffirm the paramount importance that farmland assessment has in providing equitable agricultural taxes on farmland and woodland actively devoted to an agricultural or horticultural use.
BE IT FURTHER RESOLVED, that we, the delegates, strongly oppose changing the Farmland Assessment Act, including any increase in the rollback period.