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A 47-year-old law in Utah preserves ag uses, but is getting increased scrutiny by the state's lawmakers.

Compiled by staff

July 10, 2016

4 Min Read

For the past 47 years farmland in Utah has been successfully protected from high tax rates that would make it impractical to use the land for agricultural purposes. In 1969 the Utah Legislature passed into law the Utah Farmland Assessment Act (FAA), commonly called the “greenbelt” law. This law ensured agriculture would remain feasible in Utah as urban encroachment occurred. Small changes and tweaks have been made to the law over the years but essentially it has remained the same. Like many states at the time the bill was passed, the increase in population in the state was driving up property values making it difficult for farmers and ranchers to stay in business.

The greenbelt law allows a tax advantage for those who are in production agriculture. Their property values are assessed based on the productive agriculture value of the property rather than the market value. There are three essential traits of a property in order to qualify as a greenbelt parcel; it must be five acres, it must be active in production agriculture and it must meet the minimum agriculture production requirements. “Utah’s greenbelt law has done more for production agriculture then arguably all other agriculture laws combined,” says Sterling Brown, vice president of public policy for Utah Farm Bureau.

The problem
In recent years, issues of greenbelt abuse around the state have started to surface. Some landowners, for a variety of reasons, have not been able to meet the production requirements. Others have sold all or some of their property, which triggers a re-application process with the county to ensure their land stays in greenbelt. Many times the new owners do not understand how the law works and they miss the opportunity to keep their Ag lands protected from the higher tax rates.

To complicate matters further, many county assessors in the state interpret the law differently from county to county. Tracking the land use and keeping up with land parcels that have changed the use is also a problem. According to Cache county assessor Kathleen Howell, “There is a process for landowners to go through to establish greenbelt, but a growing number of people are exploiting loopholes and are getting the tax advantages that simply shouldn’t.”

A new issue has also surfaced recently concerning greenbelt lands that have multiple uses at different times of the year. There are several ski resorts in the state that welcome grazing on their property during the summer months and therefore meet the greenbelt qualifications. They have been paying significantly lower property taxes than neighboring resorts just a few miles away. “Under the current law,” says Howell, “they are meeting the qualifications…but I don’t think that was the intent of the greenbelt law.”

When written, the greenbelt law was purposely ambiguous when detailing the fine requirements of multiple use lands because the writers of the legislation foresaw that many unique situations would arise in the future. They left much of the interpretation up to individual county assessors based on the principles laid out in the bill.

The discussion
In the 2016 Utah Legislative session House Bill 25 was introduced and proposed changes to the greenbelt law to prevent individuals and corporations from taking advantage of the greenbelt law. The bill did not pass but it did create a ripple of discussion to potentially modify the greenbelt law in the future. Legislators, county assessors, the Utah Tax Commission, farmers and ranchers are all concerned about potential changes to the law. Many farmers are worried that if the legislature tinkers with the law that it may lead to unwanted changes. This could have a negative effect on their bottom line and ultimately, their ability to stay in business. “We need to be very careful as we go forward,” says Brown “we are trying to find common ground.”

Howell agrees preserving greenbelt is key but would like to better define the qualifications of greenbelt.

Key stakeholders will continue to meet and discuss this issue going forward. In the end, protecting the principles laid out by the fathers of the original greenbelt bill, to protect the viability of agriculture in Utah, hopefully will not be lost in the shuffle.

- Bailey writes from Liberty, Utah

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