‘Current use’ law shifts tax burden to other property owners, making it tough on rural areas

Alternative view on land-use law in the state

Time has a way of flushing out the good, bad and ugly aspects of historical decisions. Tom Thomson and Andy Peterson offered one account of NH’s 50 years of current use (“New Hampshire’s current use law celebrates its 50th anniversary,” July 5).

Here is an alternative view. The authors (at least one of whom is a financial beneficiary of this law) make some questionable observations. “New Hampshire’s scenic landscape exists today due to the vision and actions of many taken 50 years ago. During the 1960s, the New Hampshire population was growing fast and so were our property taxes, particularly in the southern part of the state.”

The more that I have learned about the financial impact of this current use law, the more I am disheartened as I drive through our back roads. Yes, the vistas may be beautiful from the Governor Meldrim Thomson Scenic Highway, but it is equally obvious that life is financially difficult for a majority of residents along this and many rural roads. Perhaps property taxes were tough on some back in the ‘60s, but I suspect that they are tough on many more ordinary Granite State taxpayers today due, in no small part, to the impact of this law.

They go on to write, “The owners of farm and forestlands saw the values of their land base rising faster than they could afford, so they began selling their farms and forestlands. Much of this rural land base turned into strip malls, poorly planned subdivisions and additional roads and infrastructure, which threatened two of our oldest industries: agriculture and forestry.”

While this may have been the case in the populous southern part of the state, was it the case in rural portions of the state where most of today’s current land use exists? Without adequate local infrastructure and populations, was this land truly at risk of development (even 50 years later)?

The referendum on current use, Proposition 7, was approved by more than the necessary two-thirds majority of state voters. Given the vast difference in the population, thus voters, between southern New Hampshire and the rural north and west, was a two-thirds vote really representative in this case?

The subsequent law, RSA 79-A:1, passed and signed in 1973, allowed the assessment of any class of real estate at valuations based upon its current use. But the legislators and governor did not consider their constitutional responsibility for ensuring fair and equitable taxation. The opening sentence of this law states, “It is hereby declared to be in the public interest to encourage the preservation of open space, thus providing a healthful and attractive outdoor environment for work and recreation of the state’s citizens.”

It would follow that the state itself would be the taxing district for this law, rather than individual towns. Yet this is not what happened.

Instead, local property tax districts bear the burden of funding and managing this state program based on the amount of current use land that is within that district.

When tax benefits for CU are awarded to one landowner, those taxes must be made up by the other local taxpayers. Lowering the local town valuation (reduced land values) causes an increase in the property tax rate used to calculate tax bills.

As things currently stand, Granite Stators’ property tax bills are increased by vastly different amounts, depending entirely on the amount of current land use within their local taxing district. Taxpayers in the populous southern tier (which carried the 2/3 vote), where there is less land in current use, pay next to nothing for this state benefit.

Those of us in more rural areas pay as much as $5 per thousand of our assessed property values. Authors Thomson and Peterson do not address this impact on local property taxes. In many rural municipalities across the state, funding this law costs taxpayers as much or more than their municipal services.

The following problems remain. One, we have a state law that is not constitutionally supported by state funding; rather, the burden falls on local property taxpayers.

The state could remedy this by taxing equally across the state in order to support this benefit.

Two, we have a state law that relies on local governments to manage and enforce despite the fact that local elected officials are not trained for this task. Here again, a state program of this magnitude should be managed and enforced by trained state officials.

So, we have to ask ourselves, did this law really protect the beautiful rural vistas, or would that have naturally happened over these last 50 years as this landscape continues to be cost effectively undevelopable. Was this law simply a tax burden shift with no real social benefit?

Over the years, New Hampshire has developed a better way to approach land planning in the 21st century. Fifty years ago, New Hampshire did not have zoning laws. Today, folks concerned about development can use zoning, which doesn’t carry a heavy tax burden, as a better land planning tool.



Categories: Letters to the Editor