Tax Type
Local Taxes
Property Tax
Description
Constitutional limitation on assessments; Local land use assessment
Topic
Constitutional Provisions
Local Taxes Discussion
Rate of Tax
Date Issued
09-11-1997
| The Honorable Anne G. Sayers Commissioner of the Revenue for Northampton County |
You ask whether, when a property owner applies for use value assessment on his property under a county ordinance adopted pursuant to § 58.1-3231 of the Code of Virginia and the assessment will be higher than the fair market value established in the last general reassessment, the property should be taxed on the basis of the use value assessment or the general assessment.
Article X, § 2 of the Constitution of Virginia (1971) establishes a general requirement that "[a]ll assessments of real estate and tangible personal property shall be at their fair market value.' § 2 further provides that the General Assembly may "define and classify real estate devoted to agricultural, horticultural, forest or open space uses,' declare that the public interest requires preservation of those uses, and authorize local governments to allow "deferral of, or relief from, portions of taxes otherwise payable on such real estate if it were not so classified.'
Acting pursuant to this authority, the General Assembly has adopted §§ 58.1-3229 through 58.1-3244, permitting local governments to enact ordinances providing for the use value assessment and taxation of the constitutionally permitted classes of property and detailing the procedures for the assessment and taxation. § 58.1-3229 declares the preservation of land devoted to those uses to be "vital to the public interest,' and states that the intent of use value assessment is to "ameliorate pressures which force the conversion of such real estate to more intensive uses and which are attributable in part to the assessment of such real estate at values incompatible with its use and preservation for agricultural, horticultural, forest or open space purposes.'1
Section 58.1-3236(A) provides that property that qualifies for the special assessment is to be assessed by considering "only those indicia of value which such real estate has for agricultural, horticultural, forest or open space use.' § 58.1-3236(D) provides that the property also is to be evaluated on the basis of the fair market value as applied to other property within the jurisdiction and that the land book records are to show both values.
The primary object of statutory construction is to ascertain and give effect to legislative intent.2 The intent clearly expressed in § 58.1-3229 is to encourage the preservation of land within the Commonwealth for agricultural, horticultural, forest and open space uses. The purpose of the land use assessment statutes is to create a financial incentive to further the preservation of land for such uses.3
It is inconsistent with the authority granted the legislature in the Constitution and with the legislature's purpose and intent expressed in § 58.1-3229 for property that qualifies for land use assessment to be assessed at a value greater than the fair market value determined pursuant to a general reassessment.4 This result would defeat the entire purpose of encouraging preservation of land for the preferred uses and, in fact, would actually discourage such preservation.
It is my opinion that, in authorizing localities to enact land use ordinances, the General Assembly did not intend to permit a locality to impose a higher tax liability on property devoted to one of the favored uses. If, pursuant to the local ordinance and the statutes controlling land use assessment and taxation,5 the property would be subject to a higher tax liability, either the local ordinance should be amended or applied to avoid this result or a property owner should be advised to withdraw his application for special assessment.6
1 See 1984 Va. Acts ch. 675, at 1178, 1373 (adding Title 58.1, containing § 58.1-3229, not set out in Code).
2 See Turner v. Commonwealth, 226 Va. 456, 459, 309 S.E.2d 337, 338 (1983).
3 See Op. to Hon. Robert V. Vaughan, Va. Beach Comm'r Rev., at 2 (July 24, 1997).
4 This outcome also would render inoperative the statutory provisions requiring the payment of roll-back taxes when real estate no longer qualifies for land use assessment. See §§ 58.1-3237, 58.1-3241.
5 The commissioner of the revenue or other assessing officer is to determine the value of real estate that qualifies for land use assessment in accordance with § 58.1-3236.
6 Section 58.1-3231 permits but does not require a locality to enact a land use ordinance. Pursuant to § 58.1-3234, a property owner must submit an application for the use value assessment and taxation.
Attorney General's Opinion