Summary as introduced:
Real property tax; special valuation for land preservation. Makes it optional for localities to impose roll-back taxes when the owner of real property that qualifies for special land use valuation has the property rezoned for a more intensive use. Under current law, imposition of such taxes is mandatory.
Virginia Del. Randy Minchew’s (R-10th) proposed House Bill 1697 would make it possible for owners of acreage in Loudoun County to never actually pay their real estate taxes. They can already get their property classified for “land use” for 10 to 20 years, deferring 99% of their taxes.
Now Del. Minchew, managing partner at Loudoun County’s encampment of the largest land use lawyers in Northern Virginia, proposes to get rid of the rollback requirement so people in land use can sell anytime for a higher density use without paying the penalty of rollback taxes.
This bill seems an odd way to butter up constituents for an off-year election, and Minchew is not just one of the co-patrons, or even just the chief patron. He is the only patron.
But the local gentry, Minchew’s base, loves the land use option for tax evasion, including several members and hangers-on at the Loudoun Board of Equalization.
Minchew narrowly escaped a Republican primary in 2011 to serve his first term in the Virginia House of Delegates. Now he is gearing up for a re-election campaign. When he ran against John Whitbeck of Lansdowne and Cara Townsend of River Creek in the Republican primary in August, 2011, Minchew lost in every local precinct. Whitbeck polled first at Harper Park, Red Rock, and Belmont Ridge precincts, and Townsend was first at Tolbert Elementary. Minchew picked up votes thanks to a creatively-drawn precinct that sprawls from Lansdowne to Winchester through territory where “Walsh Colucci” is not a euphemism for “density” as it is to many voters in Fairfax and Loudoun Counties.
Below are the county’s definitions of the “Land Use” classification for deferring real estate taxes and the definition of rollback taxes.
Sliding Scale Option
“On December 15, 1999, the Loudoun County Board of Supervisors adopted an amendment to the county’s Land Use Assessment Ordinance, section 848.036, allowing taxpayers currently enrolled in the Land Use Assessment Program the opportunity for additional deferral of taxes. This deferral of additional taxes requires a recorded commitment to keep the property in a qualifying use for a term of years according to the following scale:
- A commitment to hold the property in its qualifying use for more than 10 years, but not exceeding 20 years, 99% of the use value taxes otherwise assessed may be deferred for the term of the commitment.
- A commitment to hold the property in its qualifying use for more than five years, but not exceeding 10 years, 50% of the use value taxes otherwise assessed may be deferred for the term of the commitment.”
Rollback Taxes
“Changes in use, rezoning to a more intense use (Title Sec. 58.1-3237) and the split off or subdivision of lots (Title Sec. 58.1-3241) may trigger rollback taxes. When rollback is issued, the taxes owed are based on the difference between land use value and fair market value for the current year, as well as the previous five tax years. Rollback taxes will equal the deferred tax, plus simple interest; currently at 10% per year.”
