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Halifax County supes end AFDs, move to adopt land use taxation / November 08, 2018
By a 7-1 vote, the Halifax County Board of Supervisors proceeded with plans Monday to end the county’s Ag-Forestal Districts and instead offer a system of land-use taxation to subsidize county farmers.

The scope of a land use tax system remains to be determined, however, and such a policy can only begin in January 2020. Termination of AFDs is effective at the end of 2018.

In voting to move to land use taxation, supervisors accepted the recommendations of an ad hoc study committee that has looked at alternatives to AFDs. The ad hoc committee is comprised of local officials and representatives of the county’s farming community.

The demise of AFDs was sealed earlier this year when the board voted to effectively defund the program in the current fiscal year budget. In seeking alternatives, county officials expressed a desire to find a less-costly way to alleviate the property tax burdens of local farm producers.

According to interim County Administrator Dan Sleeper, who sat on the committee, the first-year cost of land use taxation is projected at $104,000, based on expected participation by 34 percent of the county’s eligible producers.

The benefits of land use taxation would be limited to “bona fide” agricultural and horticultural producers, said ED-1 supervisor J.T. Davis, who also served on the ad hoc panel. By contrast, “there are people [in Ag-Forestal Districts] I don’t think should qualify. This allows us to tighten that up.”

While the cost of land use taxation would be relatively modest in the first year, the program is expected to grow more expensive as more producers sign up to tax part. Sleeper has estimated the lost tax revenue could rise above $215,000 if 40-45 percent of eligible beneficiaries took part.

In the current budget year, the AFD program is costing the county around $218,000. Participate in AFDs was capped in 2012 after the program’s cost threatened to overwhelm the county budget. If reinstated and reopened to new applicants, AFDs could cost Halifax County more than $400,000 annually, said Sleeper.

Sleeper added that the ad hoc committee opted to model Halifax County’s proposed land use tax after the system in place in Appomattox, which restricts eligibility among ag and timber producers. A less restrictive land use tax in neighboring Pittsylvania County costs around $3.2 million annually.

Halifax’s version of land use taxation — which has not been fully threshed out, pending further discussions — would exclude land owners who seek to claim the subsidy for preserving open land or for timber production. However, bona fide producers of agricultural products would be able to claim the tax break on 19.5 acres of timberland, as long as the primary use of their land was for farming or horticulture purposes.

That prompted an objection from supervisor Stanley Brandon, who said the tax break should be available for timber producers, too. He cast the lone vote against the motion to adopt the ad hoc committee recommendations.

“I just don’t understand how we can exclude forestry with the impact they have in this county,” said Brandon.

Land use taxation works by lowering the tax value of farm properties. According to the Commissioner of Revenue’s office, the use-based market value of Halifax County farmland would be around $230 per acre, rather than the $1,000-$1,500 per acre price that farm properties fetch on the open market.

Unlike AFDs, which require 200 acres of contiguous farmland, either individually or collectively owned, land use taxation is available to producers with tracts of land as small as five acres.

However, smaller producers may be the most unlikely of the eligible candidates to participate in the program, based on the amount of paperwork and compliance involved. “Some people are not going to jump through the hoops to take part in this,” said Davis.

Board chairman Dennis Witt said he supported the recommendation for a land use tax because farm producers are “the people we’re trying to incentivize.” Davis added that helping farmers stay in the business and hold onto their land represented a “smart growth” policy.

However, noted William Bryant Claiborne, ED-8 supervisor, the plan for land use taxation will come at a cost for other taxpayers: “We’re going to have to get the money from somewhere. That’s going to mean tax increases for someone.”

While supervisors approved the motion in favor of land use taxation, adoption of the system can’t take place until the next budget cycle in spring 2019, and the program can only go into effect at the beginning of 2020.

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Well Halifax County residential and commercial property taxpayers, be prepared to pay higher taxes in the future once the land-use taxation program begins. Small farmers will be left out of the loop as this program is being crafted for LARGE plantation landowners who would never dream of selling their land for development. This isn't smart growth, its a program to let the rich get richer and the poor remain poor with no benefits. "The benefits of land use taxation would be limited to “bona fide” agricultural and horticultural producers, said ED-1 supervisor J.T. Davis, who also served on the ad hoc panel. By contrast, “there are people [in Ag-Forestal Districts] I don’t think should qualify. This allows us to tighten that up.”
The folks Mr. Davis noted that are “the people we’re trying to incentivize.” are HIS insurance customers, wake up Halifax County and resist this program. More smoke and mirrors here!!


The Ag districts protected the big boys, land use will help the small farmer. Sorry Concerned you are wrong on this one. I don't usually agree with JT on a lot but I do on this one.


@allpolitical2 - Do some research on Ag Forestal vs Land Use taxation and you will see that folks that are not "bona-fide" farmers will not be allowed benefits. It is a much more stringent documentation requirement to get into land use taxation and more importantly will have to provide annual documentation of production activity. Small "hobby farmers" who don't derive actual documented income and folks that own timber land will be left out under the new program. Farmers who are large enough to buy crop insurance WILL benefit under land use taxation and that was the point I trying to make. Commercial and Residential taxpayers should be paying close attention to this as it moves forward as the program will cost the county much more tax revenue than is currently being projected. Someone is gonna have to make up the gap.

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