Pennsylvania Act 1994-91 — PRESERVED FARMLAND TAX STABILIZATION ACT

Act text

PRESERVED FARMLAND TAX STABILIZATION ACT
                  Act of Oct. 13, 1994, P.L. 605, No. 91              Cl. 53
                                  AN ACT

     Providing for the assessment of real property subject to an
        agricultural conservation easement.

        The General Assembly finds and declares as follows:
            (1)  The Commonwealth has undertaken a Statewide program
        to encourage landowners of prime agricultural land to sell
        their rights to develop the land. Other public and private
        programs promote the donation of development rights as a way
        of preserving farmland. Farmland owners who sell or donate
        their development rights need to have the assurance that
        their properties will be valued for use restricted to
        agriculture.
            (2)  It is the intent of this General Assembly that land
        covered by an agricultural conservation easement by which
        development rights were transferred should be valued and
        assessed at its restricted farmland market value for the
        duration of the easement. This action will complement the
        State and private programs whose intent is to preserve
        farmland as well as to preserve the economic viability of
        agriculture in this Commonwealth.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

     Section 1.  Short title.
        This act shall be known and may be cited as the Preserved
     Farmland Tax Stabilization Act.
     Section 2.  Definitions.
        The following words and phrases when used in this act shall
     have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        "Agricultural conservation easement."  A holder's
     nonpossessory interest in real property, whether appurtenant or
     in gross, imposing limitations or affirmative obligations, the
     purpose of which is to assure its availability for agricultural
     use, and which contains a third-party right of enforcement.
        "Common level ratio."  The ratio of assessed value to current
     market value used generally in the county as last determined by
     the State Tax Equalization Board pursuant to the act of June 27,
     1947 (P.L.1046, No.447), referred to as the State Tax
     Equalization Board Law.
        "Established predetermined ratio."  The ratio of assessed
     value to market value established by the board of county
     commissioners and uniformly applied in determining assessed
     value in any year pursuant to the act of May 22, 1933 (P.L.853,
     No.155), known as The General County Assessment Law.
        "Holder."  The term includes the following:
            (1)  A governmental body empowered to hold an interest in
        real property under the laws of this Commonwealth or the
        United States.
            (2)  A charitable corporation, charitable association or
        charitable trust registered with the Bureau of Charitable
        Organizations of the Department of State and exempt from
        taxation under section 501(c)(3) of the Internal Revenue Code
        of 1986 (Public Law 99-514, 26 U.S.C. § 501(c)(3)) or other
        Federal or Commonwealth statutes or regulations, the purposes
        or powers of which include assuring the availability of real
        property for agricultural use.
        "Restricted farmland market value."  The fair market value of
     farmland that has been restricted by an agricultural
     conservation easement, thus limiting the highest and best use of
     the land to agricultural purposes.
        "Third-party right of enforcement."  A right provided in an
     agricultural conservation easement in order to enforce any of
     its terms granted to either:
            (1)  a governmental body; or
            (2)  a charitable corporation, charitable association or
        charitable trust;
     which, although eligible to be a holder, is not a holder.
     Section 3.  Assessment of land containing agricultural
                    conservation easement.
        (a)  Assessment.--The assessed value of land, but not the
     buildings thereon, which is subject to either a perpetual
     agricultural conservation easement or an agricultural
     conservation easement for less than perpetuity shall be
     determined by determining the restricted farmland market value
     of the land and by applying the current established
     predetermined ratio of the county to the restricted farmland
     market value unless the appropriate common level ratio
     determined by the State Tax Equalization Board varies by more
     than 15% from the established predetermined ratio, in which case
     the common level ratio shall be applied to the restricted
     farmland market value.
        (b)  Revaluation.--
            (1)  After the initial assessment of land which is
        subject to perpetual agricultural conservation easement under
        subsection (a), the assessed value of that land may be
        decreased but shall not be increased unless a county has
        effected a countywide revision of assessments.
            (2)  After the initial assessment of land which is
        subject to an agricultural conservation easement for less
        than perpetuity under subsection (a), the assessed value of
        that land may be changed as a result of a countywide revision
        of assessments and may annually be subject to revaluation in
        accordance with the provisions of subsection (a) pursuant to
        the appeal procedures of the applicable law governing
        assessments in the county in which the land is located.
        (c)  Countywide revision of assessments.--In the event that
     there is a countywide revision of assessments involving either
     the revaluing of properties or a mathematical change in the
     assessment base, the assessed value of land, but not the
     buildings thereon, which is subject to either a perpetual
     agricultural conservation easement or an agricultural
     conservation easement for less than perpetuity shall be
     determined in accordance with the provisions of subsection (a)
     pursuant to the procedure for determining assessed value of
     property in assessment appeals after a countywide revision of
     assessments.
     Section 4.  Other preferential assessments of land covered by
                    agricultural conservation easement.
        The provisions of this act shall not be applied to determine
     assessed value of land which is subject to either a perpetual
     agricultural conservation easement or an agricultural
     conservation easement for less than perpetuity if the result
     would be a higher assessment than would be obtained by applying
     other authorized methods of assessment. Land which qualifies to
     be assessed pursuant to this act shall not be prohibited from
     qualifying for preferential assessment pursuant to any other law
     and shall be assessed at the lowest preferential assessment for
     which it qualifies.
     Section 5.  Repeals.
        All acts and parts of acts are repealed insofar as they are
     inconsistent with this act.
     Section 6.  Applicability.
        This act shall apply to all lands subject to an agricultural
     conservation easement on the effective date of this act and to
     subsequent agricultural conservation easements which become
     applicable after the effective date of this act, provided that
     this act shall apply to the taxes owed on such easements only
     for tax years beginning on or after the effective date of this
     act.
     Section 7.  Effective date.
        This act shall take effect immediately.