Buy Local Food In Kitsap

Farm policy, legislation, food health regulations and even securities regulations all affect what is available on your plate…for better or for worse. Following is a body of work produced by our contributing authors on this topic.

Farmers: Lower Your Real Estate Taxes

Last modified on 2008-07-01 20:39:11 GMT. 4 comments. Top.

Less Than Half Of Farmland Owners In Kitsap County Have Lowered Their Real Estate Taxes

Why is that?

What does it mean for Kitsap agriculture?

Is it important for farmland preservation?

This quest began with a conversation I had recently with Don Stuart, Pacific Northwest States Director for the American Farmland Trust. I met Don at a KCAA meeting organized by Bill Looney and Nikki Johanson where Don presented his research into the phenomena of shrinking farmland. A law school graduate and former commercial fisherman, Don has been working diligently for decades to understand why we are losing, Don would say permanently, our most valuable and productive farmlands at a rapid rate.

It took two meetings to give Don enough time to just scratch the surface of his research. I was so impressed with his research method and “down to earth” (pun intended) explanation. However, like many agriculture advocates his solutions to problems that this creates tend to be at a policy level, which in my view do not sufficiently address what individuals can do.

I called him to find out how I could help promote knowledge about his research and conclusions (more on that later) and our conversation turned around to Kitsap agriculture (my favorite topic). During our conversation Don made a remark that he had recently been studying the agricultural exemption as it has been applied in counties in Washington State. He had noticed that the number of exemptions granted in Kitsap were significantly outside of the range you might expect based on the experience of other counties. For you statistics geeks, say more than 2-3 standard deviations from the mean.

So I called Jim Avery, the Kitsap County Assessor, on June 23 to learn a little more about something called the “current use exemption” program for agricultural land. Jim has always been very accessible when I had a question about property valuations for specific parcels, policies and valuation methods.

Many decades ago the Washington State Legislature passed laws that allowed for property tax assessment exemptions for current use, if that use would value the land lower than what is called its highest and best use.

The laws enabling exemptions were passed in 1972. Jim and other people I have talked to say that the impulse for them came primarily from eastern Washington legislators with constituencies of larger farms and farmers. That makes sense to me. The laws enacted are currently referenced in Revised Code of Washington 84.34.

The Washington State Department of Revenue is responsible for oversight of the exemption process but it is the job of each county assessor to make decisions on applications for exemptions based upon the governing rules developed by the Department of Revenue. The Assessor must report every year on the number of exemptions granted. A summary of this report is contained in what is called the book of assessments.

Page 16 of that report has some interesting information about the exemption. According to the Assessors Office there are 398 square miles or 254,720 acres of assessed land area in the county. Here is a summary of lands exempted:

Jim Avery referred me to Tamara Beverage who is the current county assessor employee with the greatest amount of training and experience with the exemption process. If there is a bias among all public officials to downplay the importance of agriculture in Kitsap County one can see readily why by a quick review of this table. There isn’t much of it in Kitsap! Also, as Tamara Beverage put it our “ag land” is timberland.

That is, if total land area is how you measure the importance of our land and its use.

According to Jim and Tamara, agricultural land counted under the exemption would fall under the category “agriculture” but possibly under “open space”. According to both however, most of the open space land is where the remaining prime agricultural soils are located because they are in or near wetlands. The table cannot tell us but it is likely that most (more than half) of the prime agricultural soil land has been paved over for urban and suburban development.

Kitsap County has no zoning designation for ag land, so you cannot tell from the assessor’s roles how much agricultural land there is or how much is in use but of course less than 2.0% is included in the current use exemption program for the combined agriculture and open space designations.

Properties qualifying for the exemption must prove to be suitable for farmland and have been in current use for agriculture for several years. People applying for the exemption must prove a certain level of income derived from agricultural sales. Some people would probably rather not report that income because the offsetting federal income tax liability for the unreported income might be greater than the real estate tax saved.

Tamara Beverage speculated that probably most of the larger ag parcels whose owners are serious about farming and having the land remain in use for agriculture are in the exemption program already. The smaller farmers may not wish to take advantage of the exemption because of severe penalties and tax recovery if the land is taken out of the exempt pool for future development. In other words, some owners of what might be considered ag land are probably more interested in preserving their right to develop their land for other purposes because these other uses hold more potential return for the landowner/developer.

Tamara Beverage says it is ok to contact her if you have questions about applying for an exemption. Maybe we will be posting more details on that later with her. In the meantime she is glad to help you with explanations and application if you wish to look into this further. Her direct office line is 360-337-4519.

So far, my quest has turned up many more questions than answers. How much agricultural land is there anyway in kitsap County today? How much has been lost and for what reason? How much ag land that has been counted by somebody is actually used for production? Are these relatively small fractions of land suitable for agricultural production important to the economy of Kitsap? If so, why? Could we feed ourselves if we had to? Should we be worried about farmland preservation? Are current use real estate tax exemptions an effective tool?

What do you think?

Stay tuned on this topic.