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Clean and Green program changes mean higher Armstrong taxes

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Friday, July 12, 2013, 1:31 a.m.
 

Armstrong County property owners enrolled in the state's Clean and Green program will see a dramatic increase in taxes next year as the county adjusts to rates set by the Department of Agriculture.

For Helen and Willard “Leo” Harkleroad, that means almost a triple increase in taxes for their 87.5-acre Plumcreek property.

“It's just unconscionable,” said Helen Harkleroad.

She said the total assessment will increase from $6,125 to $16,525 next year.

Roger Stitt grows hay and corn on his 60-acre property in Manor Township. He said his taxes are going to increase by $500. He said that increase will make things tougher for property owners like him who rely on their land for some sort of income.

Yet Armstrong County Commissioner Richard Fink contends that the adjusted rate ends up being fairer to all property taxpayers in the county.

It also means an estimated increase in revenue for the county in the amount of $441,663, said Michael Renosky, the county chief assessor.

He said the Armstrong School District is likely to reap the biggest benefit and can expect an estimated $984,817 in revenue from the adjusted rate next year.

The statewide Clean and Green program is a preferential tax assessment that bases property taxes on use values rather than on fair market values for agricultural and forest land meeting specific criteria.

“It's a land preservation and tax saving program for property owners if you enroll the land in the program and agree to keep it in the categories (for forest or agriculture),” said Renosky. “The value is assessed at what income the land would generate. It's not what you are producing but what the land is capable of producing.”

In general, properties must be at least 10 acres and be designated for agricultural use, agricultural reserve or forest reserve.

According to the Pennsylvania Legislator's Municipal Deskbook from 2006, the agricultural use and agricultural reserve values are based on the state crop profit margin percentage for corn production, an average value of crop receipts per acre by county, a soil index factor and an average capitalization rate.

The forest reserve values are based on the average value of timber in the county.

Because of those variations, landowners with the same amount of acreage enrolled in Clean and Green would likely have different assessment values.

However, according to Armstrong County officials, even with the jump in property taxes, those enrolled in the program are still getting a tax break.

“They are still getting a preferential tax,” Fink said on Wednesday. “It's still less than fair market value and is lower than what others (property owners not enrolled in Clean and Green) would get. This is really about tax fairness. Other property owners can't keep carrying the load.”

Letters explaining the changes were sent to enrollees following last month's decision by county commissioners to apply the Department of Agriculture's use values annually beginning with the 2014 tax year.

Armstrong County has not adjusted its rate under the program since 1997, a factor that has made the rate increase dramatic.

“From now on, it will be an annual thing with either increases or decreases pending the Department of Agriculture values,” said Fink. “We'll be doing it annually so it will never be a shock again.”

County Commissioner Robert Bower said Thursday that for the last 13 to 15 years, the Clean and Green program has been available in the county to property owners who requested a tax reduction.

“And even with the adjusted value by the Department of Agriculture, (the enrolled property owners) are still paying the reduced tax as compared to those property owners with less than 10 acres,” said Bower. “I am disappointed that people with tax deductions — even with the change in value — feel the county has done an injustice, and that's not true.”

“How do I explain to property owners not enrolled in Clean and Green that (enrollees) have been getting tax reductions for 13 to 15 years while they have gotten none?” Bower added.

He said those enrolled in the program knew that rates could be adjusted. He also noted that there is an appeal process.

However, he said, before appeals are heard, the county will investigate whether the owners are in compliance with the program's requirements.

He added that if the user value ends up being higher than the fair market value, the county will use the lower rate.

Those who wish to opt out of the program or who are found to be out of compliance must pay rollback taxes for the preceding seven years. The rollback tax is the difference between use value and fair market value in addition to 6 percent interest.

Brigid Beatty is a staff writer for Trib Total Media. She can be reached at 724-543-1303 or bbeatty@tribweb.com.

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