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Editorial: New ground on tax values

Farm use values have stirred up debate in Rowan County for years, but James and Marian Rollans’ appeal of those values is the first to reach the N.C. Property Tax Commission — and the first to prompt the state to set values the Rowan County Tax Assessor’s Office got wrong.

First of all, if you ever want to get your brain scrambled, try to understand the farm use value system. Simply put, the taxable value of farmland under this system is not market value, like it would be for your house. To give farmers a break, it’s set much lower, based on how the land is used (woodland, pasture, open land or horticulture), rent value, market value and a capitalization rate that the state sets. That lower value is what interests the tax collector; it determines how much the county will charge the farmer in property taxes. Open farmland worth $7,500 an acre could be taxed at $550 an acre, for example.

Robert G. Rowland, the county’s assessor, says he was aware that he had made a mistake in calculating farm use values this year even before the Rollans filed their appeal. He met with farmers and was going to take revised figures to county commissioners, he says, but a state representative advised him to let someone file an appeal so the N.C. Property Tax Commission could set the rates.

And that’s what happened, though Rowland says James Rollans was not the person he had in mind for the appeal. Someone else appealed at the Tax Assessor Office’s request, Rowland says, someone he declines to identify. But the new rates that came from Raleigh appear to spring from the Rollanses’ appeal.

Case closed? Rowland thinks so; the state recommended changes he was going to make anyway. But the county doesn’t come out of this smelling like a rose, a fact readily admitted by Arnold Chamberlain, chairman of the county board of commissioners. Chamberlain says Rowland did indeed tell commissioners that the farm use values he had set were probably not right and would be changed, but Chamberlain is not happy about how it all came about. The values set by the state make it appear land use values on woodland and pastures have been too high since 2003 and were about to get even higher if no one had appealed. “We’ve been charging too much too long,” Chamberlain says, “and we got slapped down for that.”

This is not county government’s finest hour, but it’s also far from the worst. The new rates will shave a few dollars from some farmers’ property tax bills, and no one seems to mind that. But many non-farming property owners exploit the system — meeting technical criteria to qualify for land use values even though their main interest is land speculation or just skirting higher taxes on their many-acred estates. Knowing that such manipulation goes on puts pressure on the Tax Assessor’s Office and may very well contribute to the higher values that the state has rebuked. When others abuse tax breaks, they put more of the burden for funding county government on everyone else’s shoulders. Both Rowland and Chamberlain say that’s the real injustice of farm use values — not the values themselves, but the people who abuse the system.

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