If Land Use has to be Re-Validated, Why Not Revenue Sharing?

If Albemarle County is forcing landowners to re-validate and prove that their taking advantage of the land use tax break is a valid use …

County residents getting land use tax break are urged to send in revalidation forms as deadline looms

Albemarle County landowners with property in the land use taxation program have less than three weeks to file their new revalidation forms. As of today, less than half of the participants have returned their paperwork according to County Assessor Bob Willingham.

After September 1, 2009, the County will charge a $125 late fee to process the revalidation forms documenting that a property still qualifies for the program.  If a landowner has not returned the revalidation forms by December 5, 2009, they will face the possibility of being removed from the land use taxation program and subject to paying “roll back” taxes. In that scenario, the landowner would have to pay real estate property taxes at the fair market value for the previous five years.

Last October, the Board of Supervisors voted to require the revalidation process as a way of answering critics who charged the program was being abused by property owners who were not actually using their land for agricultural, open space, or forestry purposes. The County has never previously required participating landowners to revalidate their property. The program has been in place since 1973.

Shouldn’t the City of Charlottesville and the County of Albemarle have to re-validate the revenue sharing agreement?

This description of the revenue sharing agreement between the City of Charlottesville and Albemarle County appears in Albemarle’s annual budget.[1]

An Annexation and Revenue Sharing Agreement dated February 17, 1982, between the County of Albemarle and the City of Charlottesville was approved in a public referendum on May 18, 1982. The agreement required the County and the City to annually contribute portions of their respective real property tax bases and revenues to a Revenue and Economic Growth Sharing Fund. Distribution of the fund and the resulting net transfer of funds will be made on each January 31 while this agreement remains in effect.

During the time this agreement is in effect, the City will not initiate any annexation procedures against the County. Also, pursuant to this agreement, a committee was created to study the desirability of combining the governments and the services currently provided. The agreement became effective on July 1, 1982 and remains in effect until:

  • The County and City are consolidated into a single political subdivision; or
  • The concept for independent cities presently existing in Virginia is altered by the State law in such a manner that real property in the City becomes part of the County’s tax base; or
  • The County and City mutually agree to cancel or change the agreement.
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  1. Dirt Worshipper August 18, 2009 at 10:12

    There’s a pretty strong connection between those two ideas. After all, revenue sharing is a major reason why the County loses money on Land Use Taxation (because it pays the City more than it gets from those tax payers in the program).

    I think the last two conditions of altering the agreement are never likely to happen (i.e. the City will never voluntarily give up revenue sharing). The first one though could be a realistic option if people were to really push for it. Reversion of the City would be a good idea on many different levels, and both localities have something to gain. Of course, Republicans have something significant to lose, in that the additional Charlottesville votes would make it unlikely for another Republican to ever be elected in Albemarle again.

    Also, it’s doubtfull that urban city residents will see it as being in their interest to take a 10% tax increase to pay for rural programs like land use taxation, that have a questionable return on investment compared with other programs.

  2. Jim Duncan August 18, 2009 at 12:13

    Dirt Worshipper –

    Thanks for the comment. I’d like to see the discussion, if only because I see government not having to annually support their decisions while private citizens do.

    I hate how (not that I necessarily disagree) local politics become party-politicized. I’d like to see an honest, open debate about the merits and negatives of merging the two localities – I think there could be a fair amount from which both could benefit.

  3. TrvlnMn August 18, 2009 at 12:54

    I would support “re-validation” of the city/county agreement- only on the condition that the City is allowed to engage in annexation if the agreement is not re-validated.

    Otherwise I’m okay with things as they stand.

  4. Jim Duncan August 19, 2009 at 07:24

    TrvlnMn –

    Agreed. What I’m mostly against is a lifetime contract/agreement of any sort with no lookback to see whether it should/could be altered or improved-upon.

    The government(s) should have to play by the same rule as the citizens.

    I talked with someone the other day and she said that re-affirming her land use was exceedingly simple ….

  5. Dirt Worshipper August 19, 2009 at 09:50

    Jim, as I said, it’s basically a one page form, so revalitating isn’t a big deal if one is indeed following the intent of the program.

    Now one point where I disagree is that the two conditions are comparable. If the city or the county aren’t living up to their share of the agreement then it’s pretty obvious and someone is going to point it out. If someone buys a property that was under land use, and decides not to farm it, then it may not be obvious to anyone (sometimes even the landowner) that the land no longer qualifies for land use taxation. The revalidation serves the important role to make sure people are living up to the agreement. Given the low numbers of people revalidated so far, it looks like a significant number of people may not have been living up to their share of the agreement and thus will be removed from the program. Sure, there are plenty of people that probably got a letter from the county and somehow didn’t realize it’s importance or are merely procrastinating. If only 10% of people on December 5th no longer qualify, then that’s pretty significant, and a big savings to other taxpayers.

    Beyond that, I agree. They should have set up the revenue sharing agreement to require revalidation periodically and our community could really benefit by revisiting the conditions therein.

  6. TrvlnMn August 19, 2009 at 22:04

    What I’m mostly against is a lifetime contract/agreement of any sort with no lookback to see whether it should/could be altered or improved-upon.

    Well as soon as the state of Virginia removes the moratorium on annexation, then perhaps both parties will be willing to revisit those issues. And Crozet can become what it rightfully should be- a neighborhood in Western Charlottesville. 🙂


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