Buckingham County Board of Supervisors/ Planning ... Minutes/2017... · BUCKINGHAM COUNTY BOARD OF...

BUCKINGHAM COUNTY BOARD OF SUPERVISORS AND PLANNING COMMISSION LAND USE WORK SESSION SEPTEMBER 18, 2017

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Buckingham County

Board of Supervisors/

Planning Commission

Work Session

September 18, 2017

At a reconvened meeting from September 11, 2017 held on Monday, September 18, 2017 at 7:00

p.m. in the Peter Francisco Auditorium of the Buckingham County Administration Complex, the

Board of Supervisors and Planning Commission held an informational work session on land use.

The following members were present: Robert C. Jones, Chairman; Danny R. Allen, Vice-

Chairman; Donald E. Bryan; Don Matthews; Joe N. Chambers, Jr.; E. Morgan Dunnavant; and

Harry W. Bryant. Also present were the following Planning Commission members: Alice

Gormus, Chairperson; John Bickford, Vice-Chairman; Royce Charlton; Sammy Smith; Pat

Bowe; James D. Crews. Chet Maxey was absent. Also present were Rebecca S. Carter, County

Administrator; Karl Carter, Asst. County Administrator; Rebecca S. Cobb, Zoning

Administrator; and E.M. Wright, Jr., County Attorney.

Special guest speakers were Nicholas Morris, Virginia Department of Taxation; Dean Cumbia,

Department of Forestry; Lex Bruce, Virginia Tech and Gordon Groover, Virginia Tech.

Re: Establishment of a Quorum

Chairman Jones certified there was a quorum of the Board of Supervisors. Seven of seven

members present and the Board of Supervisors meeting could continue.

Chairperson Gormus certified there was a quorum of the Planning Commission. Seven of eight

members present and the Planning Commission meeting could continue.

Re: Invocation and Pledge of Allegiance

Supervisor Chambers gave the invocation and the Pledge of Allegiance was said by all who were

in attendance.

Re: Call to Order

Chairman Jones and Chairperson Gormus called the work session to order.

Re: Adoption of Agenda

Gormus: Mrs. Cobb, is there any change to the agenda?

Cobb: No, maam.

Gormus: I need a motion to adopt the agenda as presented.


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Allen: So moved.

Smith: Second.

Gormus: Motion by Mr. Allen and second by Mr. Smith, all those in favor raise your right

hand, or left, some kind of hand. That passes.

Commissioner Allen moved, Commissioner Smith seconded and was unanimously carried by

the Planning Commission to adopt the agenda as presented.

Re: Informational Work Session

Gormus: That brings us to New Business. Land Use Information Session. Mrs. Cobb.

Cobb: Yes, we have several guest speakers tonight. First will be Gordon Groover with Virginia

Tech.

Gordon Groover: Gordon Groover: While we’re waiting I’ll answer any questions except

about football. Alright thank you.

Groover: We were invited to make presentation about the ag values of…ag and horticultural

values for the use-value assessment and also some other issues that we think are important in the

decisions that the county will be making relative to that. Lex Bruce who is here is a colleague

and works with me on the project. I will talk and he can answer questions when you ask them

and he may even talk about football but anyway.


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The next presentation…the next slide is the outline of what we’re doing. I guess I should look

up here but I’m not used to looking in multiple places. Kinda an overview of the program. The

use value we’ll talk about the ag and forestal districts. Two approaches to… to the income

approach and rental rate approach which we use in calculating the values that are used in the

estimates that we publish and then we’ll walk through an example with the changes in the tax

rates. The use-value assessment program is adopted and we’ll look at what the deferred taxes

would be and the impact that would occur on an example piece of property. So that’s where

we’re going.

The Use-Value Assessment Program was started in 1974 with State enabling legislation. Almost

all 50 states have use-value assessment. They’re in varying forms. Michigan where my oldest

broth lives, I talked to him numerous times about it. I still don’t understand what they do. Most


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of the other ones follow something similar to what Virginia’s doing. In Michigan they have a

homestead exemption which really is not tied to acreage or anything else. But it seems to work in

Michigan. There are two…we’re going to talk a little bit about the costs and the benefits. The

costs are pretty easy to quantify. We can look at reported numbers. We can calculate the cost of

that to the taxpayers in the county. The benefits are much harder to quantify. There are lots of

studies and we’ll look at those. We’re looking at long term benefits to the community both from

economic development, tourism other aspects of that that occur over a longer period of time.

Department of Taxation sent me a research study done by George Mason looking at the two shore

counties Accomack and Northampton County and they were looking at results that said that the

programs that project land like the Use-Value Assessment Program really did not have any basic

economic problems or reduce the economic growth within the county. There are lots of studies

out there. That’s the most recent one and we have a website and we will post that study on there

if people are interested along with this presentation and others.

How’s it organized? I am a staff member on something called the SLEAC the State Land

Evaluation and Advisory Council. It’s made up of my boss, the Dean the College of Agriculture,

the Commissioner of Taxation, the State Forester and the Director of DCR. They’re responsible

for overseeing the project and also providing input into the values that we calculate, or the

estimates that we calculate on an annual basis. One thing I’ll point out is that in all cases the

assessing officer or the Commissioner of the Revenue, in each county that has adopted the

enabling legislation, is the final authority on the use-value assessment value. The values that are

applies to an acre of land, whether it’s agriculture and horticulture, forestry or open space…open

space regardless of what our estimates may show, the local assessing officer has that final

authority per the Code of Virginia. The other thing that sometimes is confusing for folks it’s the

raw land that qualifies, not the buildings, not the structures, not the ag buildings, not you know

the home farm place. In a lot of cases you may have a farm that has a house and grain bins and

whatever else they may allocate a 5 acre lot and the house and that’s taxed at fair market value.

And only the land that is in the program gets the tax break or the assessed value reduction for the


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ag and the horticultural or forest of open space land. So everything else is taxed at fair market

value.

What qualifies in the ag and hort side there’s a Code of Virginia, and Nick Morris and I both

were talking at dinner, you need to read the Code of Virginia. There’s lots of details in there that

will help in understanding. We abbreviate what we’re talking about just for the time sake of it.

Ag and hort you have to have 5 acres of land. It needs to be a bona fide farm and there’s also

statements about what qualifies is that and that’s pretty much it. There’s also a point that a

$1,000.00 of net income or product that’s worth that can qualify the 5 acres. There’s a lot of

variation between 5 acres of say boxwoods and somebody’s that got a 2,000 acres of cash grain.

But both of those are agricultural enterprises and the onerous is on the owner of that parcel of

land to be able to meet the qualifications per the Code of Virginia. Forest land 20 acres and then

open space of 5 acres. Dean Cumbia will talk about the agricultural side. You have to

participate to qualify in the…or qualify to get the use value assessment. If you don’t meet those

needs or you do something that throws you out then they can apply or impose 5 years of rollback

taxes and/or as well as interest just depending on the ordinance that’s passed by the county and

adopted in that case. But clearly you know the 5 acres is a…or I’m sorry the 5 year rollback of

that is required by the statute. I’m going pretty fast because I’m supposed to stay on a 20 minute

schedule and save time for questions at the end.


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Here’s a map of Virginia. Of the different counties we go from ag and hort, forestry and open

space those are…I’m colored blind…but those are the darker colored counties. And then ag and

hort and forestry are the lighter counties. And then the gradation goes to throughout from the

standpoint of what counties in this are jurisdictions because we have cities in Virginia that also

qualify for those as well. And you can see somewhat consistent across the state but south…the

south side and far south west are counties that have not readily adopted the Use-Value

Assessment Program. There are 92 counties that do have ag and horts, 75 that have forest and

then 56 counties that have open space.


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There’s also something called ag and forestal districts which was passed in 77. And then there

were some modifications to it or simplifications of it in 2011. The county just like with use

value has to approve ag and forestal districts. There has to be an advisory committee and then if

the Planning Commission has 4 farmers on it they can actually be part…they can be the advisory

committee for the ag and forestal district. An owner of it…owners that have contiguous 200

acres of land can ask for an ag and forestal district. Once the county has approved that and there

needs to be public hearings and again that core of 200 acres and then land can be added to those

within a mile radius of the core 200 acres that make up that and then…not all of that has to be

contiguous with the original land. You can also piggy-bank or piggy jump over top of some of

the other lands and go further than a mile depending on that. One recommendation is if you

consider ag and forestal districts is you need to engage the county attorney or legal advice in

terms of that because the Code of Virginia has been changed since 2011 and there’s not a lot of

the information about the new simplification of that. In theory you might be able to have 4 ag

and forestal districts in the county divided by the highways. We do have some counties in the

state that have over 100 ag and forestal districts. So every time a piece of property goes in or

goes out there has to be an Advisory Committee meeting and they have to be voted on. So you

don’t want to tie up the local political power as well as farmers and other members of those

committees in constant meetings throughout. The one thing about the ag and forestal districts

you have to be able…any land added or taken out has to be approved by the county.


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They qualify just like use-value assessment for the deferred taxes and reduction in those. They

can be in place for 4-10 years. It’s not an imperturbability. It’s a time…it’s a limited time for

those ag and forestal districts to exist then they have to revote on them and continue those.

They’re more flexible for decisions what land should enter them. So you know some complaints

in jurisdictions and areas are that you know somebody’s got 5 acres and hires a neighbor down

the road to make hay for him will qualify and the question is is that a legitimate farm operation

or something of that nature. With the ag and forestal districts you have some ability within that

committee to be able to work with those. Same thing is true with withdrawal of the property.

There are rollback taxes based on the local ordinance. There’s also some issues related to

unrealistic restrictions on ag and forestry. You’ll need to read the Code on some of those things

but a lot of that has to do with special use value or special assessments and taxes say to fund a

water line going through the property or through near that area of the county.

We have…we’re moving now to how we determine values, the values that would be placed on

the ag and horticultural land. We have an income and rental rate approach.


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The income approach is based on the ag census and a composit farm. So in effectwe get to the

USDA Census that’s done every 5 years. There is one in process right now that will be available

in 2019. We take the number of crops grown in the county divide through by the number of

farms and if we get more than one acre then we model that as producing…will it produce a

profitable crop or the net returns for those. In effect what we’re coming up with is that if you’re

farming this is the price that you could pay for an acre of land in the market place. And that’s

the purpose of the use-value assessment. What’s the value of land in its use, not in a speculative

use, not as in an investment but in the agricultural and/or forestal use for that land.


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Here’s a…I’ll quickly go through these. These are the crops that are grown in Virginia.

Buckingham has 680 acres of alfalfa. You can read down through there and there are 391 farms.

This is the 2012 census. We divide 391 into those acres and that becomes a composite farm. So

the composite farm will have 2 acres of alfalfa, 2 of corn, get my bifocals right here, 42 acres of

hay and so on. So the average farm is about 121 acres in Buckingham County. And then we

calculate the net returns for those crops in the county. So we’re looking at a net profit on an

annual basis of about $14.00. You’ll also notice that the majority of the land in Buckingham

County in the agricultural side is hay and pasture even though you’re looking at soybeans

making 100 almost 170 dollars an acre this is…those farmers in the room this is a average over

the last 7 years or Olympic average over the last 7 years. Not last year. But our rates are low

because we’re looking at hay and pastures being a lower profitable crop than the grain crops that

are grown.


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We capitalize that. The formula there shows that we take that $13.00, divide it through by cap

rate and that gives us a value of that land in perpeturity based on generating $13.00 worth of net

returns per acre. And the cap rate is based on farm credit or federal loan bank rates and then the

tax rate. We’re not double…we don’t want to…we do not charge taxes in our budgeting process

so we add those back in to make sure we fully adjust for it. So we have a value of land of

$118.00 basically is what a typical farm, the farm in Buckingham County could pay.


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We also make adjustments on the soil class. Those of you that are familiar with soils, the old

soil conservation service ranks soil from Class I to Class VII, one being best. We adjust those

values to reflect soil productivity so they will range from 300 to 20 dollars. Class VII soils I say

you can’t stand on them. Their either too steep or too wet. You sink in them or you roll down

the hill. So those really are not productive ag land. We have pasture and crop lands that are

reflected there.

We have a rental rate approach. National Ag Statistics collects rental rates. We use the same

approach. We take the rental rates for crop land, divide it through by the cap rate that we use in

the income approach and we come out pretty close to our previous rate based on income of about

280 to 290 dollars per acre. When you see our numbers published we round up. We round off

those numbers to make it easier for the Commissioners of the Revenue.


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And then this is the NASS or summary of the NASS report looking at the rental rates on pasture

and the crop land. And you can see in Accomack County we have almost $1400.00 calculated

value based on $84.00 of rental rate. And then irrigated crop land $95.00. So they vary across

the state from extremely productive ag land to other lands of the state that are not as productive.


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Here’s… the point is that if you participate, Buckingham County participates, in the Use-Value

Assessment Program there will be defered values. So that every parcel of land the difference

between the fair market value and the use-value assessment will have a value that is deferred for

5 years because you remember the penalty is for a 5 year period of time. And if we look across

the top that’s the 2015 fair market value. The Department of Taxation reports that and that’s the

most recent year. And then the next column is the % of fair market value that’s deferred. In

Virginia I’ll just make a note that we have to…that the State has to, or localities have to assess at

100% of fair market value. Then the total fair market value and in 2015 Buckingham had 1.4

billion dollars worth of value. Since you’re not in the program it’s zero. At that time the

nominal tax rate was 50 cents and then the taxes on the $200…or $200,000 piece of property, or

house whatever was $1000. So if we look at how much of that eligible land is deferred from 1 to

10% you can see…and we’ll have this on our website if folks want to go back and go dig

through the details, but at 1% that was in effect have a raise in the tax rate to hold everything

equal the same levy which is the levy for on real property is $7,054,000…or million

dollars…that’s at the bottom of the table. To hold that consant then the tax rate has to go up and

it varies at 1% that would be an addition $10 to someone that owns a $200,000 piece of property

down to a 10% participation rate of $111. And again this applies if you’re a farmer or forester

that you get the tax break on the ag and forestry land but you don’t get it on their dwelling or

their personal property…not their personal their real property that’s not involved in those

farming or forest activities.


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What happens in surrounding counties you’ve got participation rate. Let’s see, Amelia and

Prince Edward don’t have that forestry. They only have ag. How much is deferred? Albemarle

11%, about 7% in Amelia. Obviously Buckingham has none. The high one is Nelson County

and then Prince Edward is almost…well basically 1% deferred. Nottoway is round off to 3%.

So you can see these numbers are available from the Department of Taxation. You can look at

counties and see what the deferral rates are over time.


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I’m speeding up. Some additional comments. We did a survey Lex and I and a grad student did

a survey of Commissioners of Revenue. There’s about ½ time full…1/2 time equivalent as this

program is adopted that will be required within the Commissioner’s office to be able to handle

the additional validation and application process. Timber management plans. There’s a

requirement that you have timber management plans. Don’t actually have those. I’ll do the first

year because we’ll kill the field foresty people and the local jusidiction. They just can’t handle

the load. So that needs to be staged in. Application process, forms, proof, fees and validation

cycle all those things need to be decided on. You can charge a fee for the application to be in

use-value. As I understand it from other Commissioners of Revenue that’s one way to fund that

additional ½ time equivalent. If you use the land class and apply that having a GIS capable

system within the Commissioner of Revenue or the real estate area will greatly help that. And

then the assessment cycle how frequently do you assess or reassess because the use-values

assessment values can not change except during a reassessment cycle. So if you’re doing one

every 6 years, we’ve had some problems where you have some very low estimates that were

used and 6 years later during a reassessment we were at the peak of net returns for agricultural,

Lex and I got lots of calls. They…people were not happy about it obviously so. But those things

need to be considered as you look at the implications of this.


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Our website as you can see here. You can go…I sometimes recommend this for insomnia

problems. You can go and read things on our website. But it’s very useful. Dean and the

Department of Taxation and DCR, we all have information on there. We try and be the

repository for that information so. I think I’m done. I think we’re taking questions at the end. I

appreciate your attention and we’ll be glad to answer questions.

Cobb: So next is Dean Cumbia with the Department of Forestry


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Dean Cumbia: Pleasure to be here with you all tonight and I’d like to greet the Board and the

Planning Commission and thank you and let you know that I’m not accustomed to that seat. And

that is your seat and thank you for allowing me to be in it tonight but… It’s good to be here and

thank you for the invitation. I work with the Department of Forestry up at our office in

Charlottesville which is our headquarters office, and Gwynn Tyler who is the area forester for

Buckingham and colleague and have worked together for many years. And so really just to

provide you information about our role for the forestry section of land use. And in some ways

what I’m going over will be similar to what Dr. Gordon… I call him…Dr. Groover has done.

But we’ll get right into it. Seems like…here we go…well let’s see. How about that?

Groover: Put your glasses on.


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Yeah. There we go. Thank you Rebecca. Appreciate it. With age comes the glasses. So just a

little overview on the forestry land. Forest in Virginia…Virginia is really blessed to have a great

forestry resource. Really after so many years of human settlement we still have almost 2/3 of

Virginia, 62% is covered with forest land which is 16 million acres. So it’s a great resource for

lots of reasons.

Economic benefit is one and land use is tied to timber activity through code so. Many jobs a new

study by the Well and Cooper Center up at UVA indicated $21 billion of economic activity for

forestry. Buckingham is a big part of that. Lumber, paper, wood for energy, outdoor recreation,

wildlife habitat, clean water, clean air so lots of good things come from the forest. So we depend

on the forest for many good things and Buckingham is really a foundation block for that.


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So here in Buckingham we have a forest inventory that we’ve been doing with a series of

randomize plots since 1940. On about a 5 year cycle re-measurement and indicates about 86%

of Buckingham is forested. Lots of forest land of over 3000,000 acres. So it’s quite a rich

resource here for the county. And primarily it’s owned by private individuals and companies.

Private ownership it mirrors many counties in Virginia. Of course we have a little state forest

land and some game lands but mostly private ownership.

As far as the timber types in Buckingham County it’s kinda about half between pine and

hardwood, hardwoods being the trees that lose their leaves; oaks and hickory, maple and such,

poplars. A little over half and then the rest is in pine and then some mixed pine and hardwood

stands. You see a lot of pine riding around the county but looking on the aerial photographs

you’ll see lots and lots of hardwoods too. So you’ve got a good balance of types of timber here

in Buckingham.


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Timber activity. From some of our records we track all the timber harvests and for last year

almost 150 different sites of harvesting activity for nearly 10,000 acres. And this makes it

number 2 in Virginia as far as harvesting activity. So Buckingham is definitely a big player in

forestry in Virginia. From the economic stand…well actually this is from forest products tax

data indicates that this would be the landowner benefit direct…direct landowner benefit from

harvesting timber is over $12 million. And the total economic output and this is from the UVA

study from primary process and secondary process and it’s some other benefits is $64 million.

And then employment over 500 and that’s not necessarily right in Buckingham but the timber

generates this much, this many jobs in Virginia. So Buckingham is very important from a

forestry standpoint.


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Ok back to land use. The role of the state forester and as Gordon said the state forester is one of

the members of the State Land Use Evaluation Advisory Committee or Council and Todd Grove

who’s my assistant and I work together on the specifics of the land use taxation evaluation and

represent the state foresters from that standpoint. So one of our missions or tasks through the

code is to provide a uniform standards by which all of the counties would go by for real estate

that’s devoted to forest use. And when requested by the Commissioners of Revenue, for the

county or citizens, landowners we provide opinions render opinions about qualification of

various properties for land use. And then on an annual basis as from the ag side and

conservation we provide a range of suggested values to the Commissioners of Revenue for the

forest land use values. And those are provided to Nick in the tax department and they publish

those. And just last week they were adopted for the 2018 year.

So land use with forestry through code is really focused on timber management. So I

mean…we’ll put a capital T on Timber. We have lots of benefits from the forest but when the

code was enacted it was about timber producing crops the timber on land as well as soil

conservation practices. Things that would enhance the growth of desirable species that are

commercially valuable that can be sold. Reduce soil erosion and prevent soil erosion. Now the

intent can be in two ways and Gordon mentioned this by either a signed commitment with the

county, an affidavit saying I’m devoted…this land is devoted to timber management. So some

counties will use that as a landowner can sign and re-enroll in that or the other is to have a forest

management plan in place on that property that’s developed by a professional forester. So it’s

two ways a landowner can demonstrate their commitment to timber management.


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Qualifications must be at least 20 acres of productive land capable of producing a timber crop.

You know some areas that have very poor soils really can’t meet that timber crop criteria, but

very little of that in Buckingham. Well distributed, commercially valuable trees of any size and

that’s important. What we call 40% of normal stocking of what a normal forest would be. So it

has to have…we have a table that indicates the numbers of trees and the density. And then this is

important too because in counties like Buckingham where there’s a lot of timber harvesting

activity land that has been recently harvested. Well there’s no trees now but it’s in the process of

being planted or naturally regenerated they still qualify because that land is still productive. And

in Virginia if you walk away from a piece of land it will have trees on it eventually because

that’s just the nature of land in Virginia, the seed source, the climate, the rainfall. You will have

a forest there so. Young forests count as well as older forests.


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So the use values how do we determine those? So this is again very important. It’s based on the

potential of the site to produce. It’s not based on what’s there now or what could be in the

future. It’s based on its potential to produce a forest crop. So that’s very important. Not the

standing timber. It could be again a one year old small tree or it could be a 100 year old large

oak tree. But it’s based on the land not on the current crop. So we determine the present value

so on that and I’ll go into that on my next slide.

Trees are used for many things. Trees go from lumber to many products and we have many of

those here in Buckingham County.

And we work on a total stand not individual tree basis but the volume and the potential of a

whole forest.


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We do some modeling and based on a lot of research and study by Virginia Tech other places,

we can actually predict growth and yield on various types of soil based on area scenarios. So we

predict a yield and then the volume. Volume’s important because volume translates to value. We

have a forestry financial analysis tool that we use based on the specific variables and parameters

we put on it. And there’s a bunch of them. And we have to do one that fits the various areas and

the various types of timber. And we run that similar to the soil values once they’re rate. We

have just three values we classify for forests whether it’s fair land, good land or excellent land.

And again based on the ability of the soil to produce timber crops.

Then all that we roll into the formula and then determine the present values of the costs and the

revenues. There’s timber revenues and then there’s also costs of owning land and some of these

are that affect that are what type of timber is it? Is it pine or hardwood? How quickly does it

grow? The current market value of timber is what we call stumpage prices. We usually go with


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an average stumpage price averaged over several years. The reforestation costs if it’s planted.

How much…that’s a cost up front? How much does it cost to plant it? And then the time frame

whether it’s long or short depending upon the timber type. Then again we have some other

variables or parameters we put in the equation whether it’s interest rate, the inflation, annual

costs and then taxes.

Well we do something similar again to agricultural. We kinda come up with a composite forest.

Pine has a shorter rotation as many of you know. Pines can grow to be cut from 20 to 40 years.

Hardwoods are usually much right longer you know up to 80 years. So we have different

management regimes, different growth and yield models for each of those.

Our composite forest is based on how much forest of each type is here in Buckingham County.

And so we blend those two to say what’s a composite forest based on that.


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And then finally we…the formula is we annualize the costs and revenues, discount those to the

present time and then capitalize it divide it by the interest rate. That gives us the value. And so

some examples of nearby counties that we have…actually these are…I have a little mistake here.

These are 2018 values that have been…were just adopted last week by obviously our council for

neighbors over in Cumberland County and a little bit to the south in Campbell County. So that

gives you an idea of similar Piedmont areas for the 2018 values. These are suggested to the

Commissioner of Revenues and it’s up to the Commissioner whether they use these or not so. So

that’s our process with forestry. Again some similarities. Forestry important to landowners for

many reasons. Forestry important to the county and we try to do our best to a scientific and

unbiased approach to come up with values based on the code and based on good science.


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Nicholas Morris: Good evening. My name is Nick Morris and I’m with the Virginia

Department of Taxation. My unit works with the localities. It’s called Property Tax and what

we do is provide some guidance what we call Law Advisory Aide and Assistance. We typically

get…interact with the assessing offices, most frequently the Commissioners of the Revenue and

Assessors in those localities that have an assessor. Generally we are asked about the laws, how

to best interpret them and we try to give them general guidance. We do not offer official

opinions or rulings that would come from the tax commissioner. I get, myself, every day, calls

or emails with questions. We have the opportunity to interact with a lot of localities and hear

some of the things that they are dealing with and the kind of challenges they are coming up with.

My presentation is basically going to be drawn for that. There is going to be some focus on the

laws that apply. But in addition I’m going to be talking about some things that may be of interest

on a more general, I’m sorry, did someone say something.

Cobb: No sir.

Morris: Then to be kind of drawn on focusing on the laws that might apply and some general

concerns that you may want to look at in a broad term. More specific questions will be best

addressed by Dr. Groover and Dean.


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The program is called Special Assessment for Land Preservation. It is a program for property

and land specifically in special classifications that are in a qualified and compliant use. I want to

emphasize compliant and qualified. Local enactment of the program by the governing body is

required in the form of an ordinance and implementation and ongoing functions become the

responsibilities of the Commissioner of Revenue or Assessing Officer.

Foremost, suggestions in terms of best practices, staff responsible for the program administration

should be trained and all local property owners should be informed of program benefits and


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responsibilities, costs, and potential benefits. The qualified use of the enrolled properties and

other related manners needs to be fully understood to ensure local satisfaction with special

classification programs and compliance with all program requirements.

To really know the program if you are seriously going to consider implementing it in

Buckingham County, there needs to be a thorough examination of the statute because there are

certain options that localities have that they can utilize. It’s not a set one size fits all. There are

different approaches that can be taken and there are specific laws that apply. I’m going to select

a few statutes that basically address the implementation or the start us of the program from the

ordinance from the council or Board of Supervisors and the administration from the Assessors

office. The laws that apply to this program are located in the Code of Virginia. Titled 58.1

Taxation. Chapter 32 deals with Real Property tax.


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It comes under Article 4 of that chapter. Special Assessment for Land Preservation. It

encompasses the statutes #58.1-3229 through 3244. Again, I have to emphasis, if you are seriously

interested in it, a complete look at the statutes is needed. The intent of the this article is to provide

for the classification and permit the assessment of such real estate in a manner that will promote

the preservation of it for the public benefit.

In subparagraph 3229, is the Declaration of Policy which is not set out in Code and if you will

bear with me I’ll read it to you because I don’t think you can find anything else that would


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describe the benefits of the program better than that particular statute. I’m disappointed it’s not

included because I think everybody from citizens to legislatures we have at the General

Assembly should understand what the program is actually about. I need to read that from here.

It’s a mouthful but I think it does a good job of stating what the policy is about. What the

program is about. To summarize it is to ensure a readily available source of real estate, to be

within the concentrations of population, conserve natural resources, promote land use planning

and orderly development, and promote a balanced county.

58.1-3231 is the statute that gives authority to the counties, cities and towns to adopt ordinances

which will allow for the program to proceed. The governing body shall be authorized to direct a

general reassessment of real estate in the year following adoption of said ordinance and should


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note that the land values in the use program are only updated with each reassessment. I’m not

familiar with how often you reassess but if you are on a 4-6 year cycle like most counties, land

use values would be changed within that period of time with each reassessment and not between

intervals.

The governing bodies and the assessing officer under 3234 have responsibilities that are relevant

to the application by the property owners to the program. The governing body will also have

ordinances to deal with which pertain to application fees, revalidation and continuation of

valuation assessment.


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There are determinations under 3233 that the assessing officer has to make to make sure the

property meets the qualification requirements to be in the program. Ok. There is no income test

like with disability or tax benefits of that type. It’s simply how the land is going to be used. If

its used in a qualifying manner and the application is submitted and meets all the qualification

requirements and continues the use, it can continue in the program as long as several things

happen.

The valuation under 3236 is the responsibility of the assessing officer who is only to consider

those indicia of value that come from the use of the property. What this basically means is that

people are paying $1500 an acre for the land, to use it for whatever purposes but it’s being

farmed and the indication is the value of the land is only $150 an acre, that’s what its going to be

taxed on. Ok. So what the assessing officer has to do is find ways to determine what is the fair

use value of that property. The law does provide that the assessing officer can use personal

knowledge, judgement and experience as to the value but they can also consider other means.

The SLEAC committee or council that I mentioned earlier is established to get those values and

there are scientific ways they go about coming up with those values for every locality in

Virginia. Many localities do use them and it’s well recommended to consider them at least.

Some localities rely simply on what the assessing officer or Commissioner of the Revenue

decides they are worth. Obviously there needs to be support of whatever methods you take.

When the property is listed in the land book, both the use value and fair market value need to be

reported. I’ll explain why that is a little later. But both values need to be reported in the land

book.


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Now a property can be taken out of the program. Ok. One of the disqualifying conditions is

mentioned in 3237 and is also the responsibility of the assessing officer. If there is a change in

the use of the property, one other than what it was qualified for being in the program, that

property is to come out of the program. If the owner or its agent requests a change in zoning to a

more intensive use, the property comes out of the program. There are penalties that are called

roll back taxes. Roll back taxes will only apply under those conditions.


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Ok. Now there are other ways the property can come out of the program. If the treasurer

discovers that the property owner is delinquent in his taxes, the property will be taken out of the

program. The owner will be eligible again to reenter the program once the taxes and fees and

interest and penalties have all been brought up to date and as long as it’s going to continue in its

use. As long as its continuing in its use, even with delinquent taxes, it will not be roll back taxes

applied. That’s an important distinction. I found a locality that was charging roll back taxes

when there was a delinquency in the tax payment and that’s not part of the program.

Other considerations. These are some observations that have come to me through my experience

with it and talking with people around the state. I think things that citizens need to understand.


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It is likely there is going to be a reduction in the tax base. All things being equal, the use values

are going to be lower than market value and so the taxes that are applied to the property, the

value will be lower so you are not going to get the same revenue. In order to maintain the same

revenue, there will have to be an increase in the tax rate. In fact this is a subsidy that other

taxpayers in the locality are providing to properties in the use program.


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Program administration. The program needs to be administered and property in the land use

classifications needs to be monitored. This may require additional personnel, training and the

establishment of prescribed procedures. There are applications and updates from property

owners to be processed. The land is to be qualified, compliant use for it’s classification. In

fairness to the local taxpayers supporting the programs, periodic inspections are recommended to

ensure that those in the program are in compliance with it’s provision.

The Department of Education, the State Department of Education distributes money to the local

schools. That money is distributed based on calculations that are made known as the Composite

Index. One of the major components of the Composite Index is the value of taxable real estate in

the jurisdiction. With localities in the land use program, remember I mentioned earlier about the


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fair market value and the land use value are listed in the land book. When the property value for

your locality is calculated for the Composite Index is based on the fair market value because the

use value, what you are actually collecting tax on, is a local option that you agreed…you could

tax that property at it’s fair market value but as a locality you found the benefits of the program

worthwhile and agreed to institute the program if you so choose. But one of the costs is going to

be the value in the Composite Index is going to reflect higher value than you are actually

collecting taxes on. This may result in a higher position in the Index which would reduce the

portion you would get from the State in school board funding. You may want to ask me more

questions about it and I’ll try to answer them later. It’s a rather complex process but the net

result means that you are looking like you’ve got more taxable property than you actually are

getting tax on so you are not getting the taxes plus you are looking like the value of what you are

getting money from is actually higher than you are actually getting. I don’t know if that cleared

it up at all. If you have any further questions, I’ll be glad to address that.

Unintended Consequences. Again this comes from comments that have come to me from other

localities that do have the program. As you can see many localities do have the program and

they do see the benefit of it. But there are some things that need to be understood.

Unfortunately some people obtain land use classification, but do not comply with the program

requirements. The program is not intended to reduce taxes for those with land holdings that are

not in a qualified compliance classification use. Ok. Failure to properly monitor the properties

in a program can lead to what I call compliance drift. They are not being checked on. So, they

go out of compliant use and nobody is really following up and so people who shouldn’t be

getting the use value assessment are getting it. Again, the program is not intended to reduce

taxes for those with land holding that are not in qualified, compliant classification use.


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Another observation from comments I’ve heard and actually talking with some taxpayers that

were in the program but didn’t quite understand what it was about but with time local conditions

could change and the program may come to be seen as no longer beneficial for the locality as a

whole. Some in legitimate land use have come to see the programs as an entitlement, and

strongly oppose changes or discontinuance of the program. So there will be political pressure

and a desire to change or eliminate the program in the future. One other thing that I didn’t

mention in here that came to me after I wrote this, one of the land use classifications is open

space conservation. One of the accepted uses is the preservation of natural resources and I can’t

remember what the exact wording is now but it has to do with preserving natural resources. One

of the growth industries in Virginia right now are the rise of solar farms. Many localities

particularly in rural areas where there are large tracts of land where these solar farms pretty much

require in many cases 300-400 acres or more to make them economically viable. They…if a

locality has an open space classification program, there may be a time when that use is going to

be…an attempt to make that use a qualifying use. You need to understand that solar farms right

now, the legislatures have enacted rather substantial tax exemptions for the…what they call the

equipment, facilities and devices. Solar Energy equipment, facilities and devices. It’s rather

extensive on how it goes and I’ve got a 20 page book on that but they are either going to be at

80% or 100% exempt on the equipment. The land is not included in that. So for many localities

that have these solar farms, the land is going to be the source of revenue. In many cases you are

going to have land that was in land use, maybe not here because you don’t have it, but a locality

that had land use now in a manufacturing, industrial use which will put the land at a higher value

than even what would have been it’s value as farm land. Most of the time these require a special

use permit and looking at it as an industrial site rather than agricultural site. I’m concerned that

one of the unintended consequences will be that there’s a program...nothing has been done about

this yet. Nobody’s addressed it. I’m probably stupid for bringing it up but I feel it’s important


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for citizens to understand that this could happen because actually the use of solar energy is a

means of preserving natural resources. So, there could be a time when a smart attorney whose

going to look at it and say this should be a use. I suspect that the General Assembly will have to

act on it. So I don’t thinks it’s a lock. I don’t think anybody can come and say I think this is

how it should be and it’s going to happen but it could happen and I think there needs to be an

awareness of it.

Morris: I thank you all and if you have questions, I’ll be glad to address any questions you want

to ask.

Gormus: At this time we’ll invite questions from the audience.

Cobb: Just from the Planning Commission and Board of Supervisors.

Gormus: Just from the Planning Commission or Board of Supervisors to the presenters. Any of

the Board has questions, please state your name so they can get it correct on the recorder.

Dunnavant: Morgan Dunnavant, District 4 Supervisor. On the acreage requirements, I

remember hearing 20 for timberland and as little as 5 for ag and horticulture? Are those numbers

cast in stone or can they be adjusted by us in implementation should we chose?

Morris: They are cast in stone. They are part of the laws that are in place. Under 3220 I think

it is or 3230, I forget what the Code is, it specifies in law what the minimum requirements are in

acreage. There is a little bit of flexibility because the lower acreage is sometimes allowed for

specialty products. I’ve got a friend that raises mushrooms on a 2000 sq. ft. warehouse and


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that’s not a lot of land. He didn’t qualify but the point being that there are specialty products that

can be raised on very small tracts of land. That’s why I think it’s down to 5 acres. But the

locality does not have the option of changing the acreage.

Dunnavant: That was my question.

Jones: I believe that one of you stated that there was 92 million of land in our county that’s

forestry, does that include property that’s owned by paper companies or just including those in

the private individual.

Gormus: Yall have to give names because it’s going to make it hard to know who said what for

our recorder.

Jones: Bobby Jones, Chairman of the Board of Supervisors.

Gormus: Thank you.

Cumbia: 90 percentile, I’ll have to look at my slide, but that privately owned which includes

any private company, individual organization, family so it will include paper companies as well.

Private not government owned. I’m sorry, Dean Cumbia. Department of Forestry.

Gormus: Further questions from the members?

Jones: Questions from the Board of Supervisors? You’ve gotta have some questions.

Bickford: Johnny Bickford from the Planning Commission. I work with some counties on

theirs and they have a five year term for their reevaluation and they have to submit a plan or go

over the one they had. Is that time frame established by the County for timber management.

Anybody?

Cumbia: Dean Cumbia, Forestry, I think Mr. Bickford, the question about longevity of forest

management plan, is that kinda what you are getting at?

Bickford: Not specifically about that but every five years you have to come back and revalidate

your application. There is a fee to do that. You submit it but you also have to have a forester go

over your timber management as well as I think ask for receipts on your farm account to make

sure you actually are still generating revenue. I’m asking is that the ability of the county to set

that time frame or is that by Virginia State Code?

Morris: Nick Morris. That is set by ordinance by the revalidation and reapplication is all set by

the ordinance. It’s provisions within the statute to create those time frames by ordinance.

Bickford: Ok, so in other words, if the County of Buckingham decided to do this, we could set

our own…we set the fee as well as the revalidation time frame. Am I correct on that sir?


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Morris: You can set the fee, let me see the specific statute on that for you. Ok. Chapter 32;

58.1-3234 Application by property owners. It talks about the initial time frames for application

but it also provides any locality which has adopted a fiscal tax year…wait a minute, wrong one.

The governing body, by ordinance, may permit applications to be filed within no more than sixty

days after the filing deadline…I’m sorry. I need to go a little further in here. The governing

body of any county, city or town may however require any such property owner to revalidate

annually with such locality, on or before the date on which the last installment of property tax

prior to the effective date of the assessment is due, on forms prepared by the locality, any

applications previously approved. Each locality which has adopted an ordinance hereunder may

provide for the imposition of a revalidation fee every sixth year. So the revalidation fee will be

every 6th year and revalidation every year. That would be implemented or enacted by ordinance

by the locality.

Bickford: Thank you sir. I do have one other question too. If this is implemented by the

County, I’ve had this question come up from some people I work for, not so much in timber

land, but farm land if you had grain crop, soy beans or whatever, if you are renting your farm

land, does that disqualify you for land use?

Groover: Gordon Groover, Virginia Tech. No. Rental property, most ag economy in the State

requires rental land to be functional. No, it’s not required. They may ask the property owner to

provide an affidavit of renting the property to that farmer or the farmer providing documentation

of the crops planted, yields and things of that nature to show that land is actually farmed. That’s

the requirement there. Rental property is definitely included in there as long as it meets the 5

acres and other requirements that the assessing officer, commissioner or the county adopts as the

procedures that they use.

Bickford: Thank you, sir.

Morris: The owner would have to put in the application though.

Bickford: Right. They understood that but the question, there was discussion that they might

loose their…because they weren’t actually farming it themselves, they were actually renting out

part of it.

Morris: It’s how the property is used. That’s really key.

Smith: Sammy Smith, Planning Commission. This question is for Dr. Groover. We do not

have to supply a lease or a copy of our lease to get the land use application?

Groover: That’s correct. You just have to show that the land is actively farmed. The property

owner is the one that provides that to the Commissioner or Assessing Officer.


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Matthews: Don Matthews, District 3. Board of Supervisors. Dr. Gordon, you stated that there

were 319 parcels or individuals in Buckingham as far as ag or horticulture. Is that including

forestry?

Groover: No that’s strictly agriculture. That’s the number of farmers in 2012. That annual

census is only done every 5 years and in 2012 there were 391 farmers in Buckingham County.

Matthews: 391

Groover: It’s on the slide.

Matthews: How many different parcels of forestry is related? Does the forestry guy know that?

Cumbia: Dean Cumbia. I don’t know. We have a statewide estimate of private forest land but

we have it done in our office and I guess it would have to be done parcel by parcel. I do not

know.

Matthews: Of the 391, the minimum acreage would be 5 acres. Is that correct?

Groover: No, that’s the number of individuals in most cases have filed a Schedule F tax return

and are identified by National Ag Statistics as farmers. They can also have a FSA Farm number

but those are just the individuals, the size and acreage, the average size farm is 121 acres or

whatever. That’s the USDA census is available online. The public library probably actually has

a copy of it so you can go in and look at all the data reported for Buckingham County.

Jones: Alright, Bobby Jones again, we know that the value that’s assessed if we had land use,

we know its set by the Commissioner of the Revenue. That information is supplied by the

Government as to what that figure is?

Morris: Can you repeat the question? Are you addressing it to me?

Jones: Whichever one knows the answer to that?

Morris: Nick Morris, Mr. Jones, you asked about the use values, how they are set?

Jones: Yes.

Morris: Ok. They are…the Code provides the assessing officer whether it be the Commissioner

of the Revenue or the Assessing Officer to use what they call experience judgement as long as

they are basing the value on factors that contribute or are the result of the use of the property.

So, you can’t value it as an industrial site. It has to be valued as a farm site or agricultural site.

The Virginia Tech, Dr. Groover and Dr. Bruce here, they build models in terms of coming up

with values for various soil types that are present in different localities around the State and they

come up with values for each of the localities, jurisdictions, counties, cities that implement the


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program, they recommend based on analysis, criteria from various sources. Most issues values

from the SLEAC council. Some localities, Commissioners do their own values. The State does

not do them per say. We do not tell anybody what values they have to use. Department of

Taxation doesn’t monitor any of that. It’s a local governing issue. I will point out again, I’m

sure everybody knows this, real property and tangible personal property are segregated from

local assessment taxation only. Our role is basically to provide some guidance on laws that are

enacted by the General Assembly and we don’t dictate what the locality has to do.

Jones: Alright, I’ve been to several meetings over the years on land use and what I understood

there was the key to land use is the amount of people that participate in the program. In other

words, not everybody even though you have land use, not everybody wants to put their property

in land use and some of them say that it’s because when you submit the application there are so

many things on the application that a lot of the farmers in particular don’t care to divulge to

people such as they have to show their taxes they had on the prior year. Is that true?

Morris: That’s not really addressed in statute. You set up those kinds of application

requirements. But again, I can’t answer that. We in the Department of Taxation really don’t

dive into the county’s too much. We stick with the statutes and when a call comes in we look it

up and answer it. I’m pretty sure the application requirements are set by the locality in terms of

what they need to validate the property is actually going to be used for agriculture or horticulture

use or whatever.

Jones: Right. The last meeting I went to involving land use was at UVA and at that meeting,

this came up and they stated that only about 21-22% of the people that were eligible for land use

would submit to get land use.

Morris: I can’t answer that because we don’t collect any data like that.

Jones: Alright. I thank you.

Morris: Yes, sir.

Dunnavant: Morgan Dunnavant, District 4. I was to reiterate my acreage question. That is the

State minimum standard for acreages. The 5 for farm and 20 for the forestry. That’s the

minimum that’s acceptable. Is it within the county power to increase those required acreages?

Point in case. My question, we have a lot of land around here that has been sold to people that

come in and buy 5 or 6 acres as a farmette. They raise 2 or 3 goats and a pony and call

themselves farmers. Will they be able to take advantage of this program just like they were

raising adequate production cattle?

Groover: Gordon Groover. That’s a good question. It arises quite frequently. If you have 5

acres, they carve out a lot for the house, then you are no longer qualified.

Dunnavant: I thought of that.


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Groover: On the other side, you also have let’s say 8 acres and you carved out 3 and you’ve

still got 5 acres of open land. Again, that’s a local option but it’s a validation. Is it say a

bonafide farm? Are they able to show crop production records? Sales of product that equal a

minimum of $1000. Not necessarily sales but values. If hay sold for $100 a ton, then you need

10 tons of hay from that 5 acres to justify that you had $1000 of value. Also in the startup years,

I think and I’m not sure, Lex may be able to help me, you need 3 years of production history. So

they need to be able to show 3 years of producing a product on that farm that met those

minimum requirements over the 3 year period of time. Those can be used and an affidavit is

signed that will state that we meet these requirements and are asked for documentation.

Bruce: Those requirements are left up to the locality. Lex Bruce.

Dunnavant: The requirements are but the acreage is not.

Bowe: Pat Bowe, Planning Commission. Question, if the land has been subdivided it no longer

qualifies does it? If it’s cut into lots?

Groover: If it meets the 5 acres and you are producing $1000 worth of product. Those are the

minimum requirements. But you have to be able to produce farm at 5 acres. If it’s a house site,

you don’t qualify. So those are the kinds of qualifications and validations when the application

is submitted.

Bowe: Ok. Another thing, I think there’s a whole lot more to this than just the law. We sat in

here as a Planning Commission last year or year before redoing the master plan. I mean this

auditorium was filled with people 3,4,5 times. Everybody’s overwhelming opinion was they

wanted Buckingham to stay rural. This is simply a method of allowing them to receive what

they want. This was an overwhelming desire of about everybody unless my memory is totally

wrong. Anybody care to comment on that? Because it seems like all yall are covering is the

legalities of it.

Morris: Nick Morris, Department of Taxation. Yeah, there are a lot of things to consider. This

is what you all as Board members, Board of Supervisors and constituents have to understand.

There are a lot of things that you need to consider. The idea of hobby farm. That is not what this

is intended for. Ok. That’s what gets back to what I was talking about in my presentation in

terms of having adequate staff to make sure that the people that are…the property that is in the

program is actually in the qualified use and compliant use. Ok. It means when you are dealing

with…if you are a farmer you know that sometimes you have bad crops. You have bad yields.

Sometimes you got a lot of POA follow. These are things you have to consider on how you

administer the program because one year he’s not growing because he’s got to regenerate the

earth or something. These things come up. These questions come up and it’s a lot to consider

but the law gives you a skeleton. From that you can work or see what works for Buckingham

County. What works for Buckingham County might not work in another locality and what

works in another locality may not work in Buckingham County. You have to look at the statute


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and see what it has to offer. See what your limitations are but you also see what options you

have that you can use. There are quite a few statutes and if I sit here and read them to you,

everybody would be asleep in 5 minutes. You really have to sit down and look at them, break it

down in what applies to what and what applies to qualification requirements. What applies to

the ordinances. What applies to the qualifications. What applies to the implementation. What

applies to maintaining the program. Look at it in ways that you say ok, we can do this here, may

you want to do this other thing at this place here. That’s the only way to address it because it’s

not a one size fits all localities. I don’t know how to address it any other way. I can tell you

what the laws say, you can read that yourself but how you are going to use it…if you have

questions, if you say what about this, you can call me. I will look it up for you. I look for

Attorney General opinions. I look for Tax Commissioner and if I can find anything on the exact

question that you have, whether you can do it or not, I’ll get it for you. That’s what we do in our

department.

Smith: Sammy Smith, Planning Commission. This question is just thrown out, since the

General Assembly has changed the laws on farm use tags, it made it pretty simple, you either

have your federal farm number with you or your F-Form with you so why can’t we sweeten this

up and make the qualifications your F-Form for Federal Taxes or your Federal Farm Number?

Groover: Gordon Groover. I wish it was the case because an acre, you know the parcel of land

is what qualifies not the individual. That’s where you run into problems. The question about

rental rates as well. So it will be really simple if you walked in and showed your Schedule F and

said I rent these places. Farmers in some areas rent 100 parcels of land or more and be able to

blanketly qualify all that land. The Code of Virginia doesn’t do that. The individual owner

applies and qualifies that parcel of land. You are a farmer when you file a Schedule F and IRS

accepts then you are pretty much within those guidelines but when it comes to individual

property ownership that’s not the case.

Someone from the audience began to speak.

Gormus: If you can give her the mic, if she is going to speak we need to have it on record.

But…it is a work session just between our Boards. It’s just an educational session.

Any other Commissioners or Board of Supervisors have questions.

Jones: Seeing no more questions.

Dunnavant: Do we have contact information on these gentlemen, Mr. Jones?

Gormus: Yes, Mrs. Cobb does.

Dunnavant: So we can get back in touch with yall.

Jones: Any further business? Do I have a motion to adjourn? I don’t have to have a motion.

We adjourn now. Meetings over.


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There being no further business, Chairman Jones declared the meeting adjourned.

ATTEST:

________________________________ ________________________________

Rebecca S. Carter Robert C. Jones

County Administrator Chairman

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