By Alan Prendergast
By Michael Roberts
By Michael Roberts
By Amber Taufen
By Patricia Calhoun
By William Breathes
By Michael Roberts
By Melanie Asmar
As Colorado has grown and land prices have shot up, the gap between those agricultural assessments and a property's real worth has widened. In rapidly growing Douglas County, for instance, wheat land assessed at $28 an acre can actually sell for up to $20,000 an acre to someone who wants to develop it badly enough.
As a result, the laws that give farmers and ranchers a tax break have assumed another role: They make it feasible for agricultural landowners to resist the advances of developers who would turn the wheat and grazing fields into a Wal-Mart or more tract housing without regard for maintaining Colorado's rural character. "If we lose the ag exemption altogether, we'll lose agriculture in this state overnight," says cattleman Brown. "We'll lose open space overnight."
To those savvy enough to understand them, however, the agricultural laws signify something else entirely: an easy and lucrative tax break. This is particularly true for people who aren't in the business of making a living off the land but who own large, expensive pieces of property: a 35-acre ranchette in the foothills, or a 5-acre spread in Boulder County, or a sprawling piece of ground on the plains where they hope to build their dream home one day. In the meantime, though, they wouldn't mind saving some money.
So the number of requests for the farmer and rancher tax breaks are particularly high in formerly rural areas now being developed as bedroom communities for Denver's business centers: Douglas County to the south, Jefferson County to the west and Elbert County to the southeast.
Even assessors concede that with enough effort, an undeserving landowner can get a massive tax break. "If they play the game right," says Karen Hart, Elbert County's assessor, "they can beat me."
One reason is that the laws are loose. An owner need only prove that he used the land mainly for agriculture and that he attempted to make a profit. A couple of cows or a dozen bales of hay often are enough to do the trick. The game is made easier because assessors' offices typically have only one or two people to check out the deluge of requests for agricultural tax breaks that arrive each year. In Elbert County, that person is Mary Vote.
Vote's tiny cubicle on the second floor of the county building in Kiowa is plastered with pictures of cows and windmills. That's because, in addition to her day job, Vote is a real rancher. She lives on 700 acres homesteaded by her husband's grandfather, where the family raises wheat and about fifty head of cattle. "So it angers me when I see abuse," she says.
Unfortunately, she adds, she doesn't see it as often as it occurs. Each year Vote sends a questionnaire to every landowner in the county. If someone claims he is using his land for agricultural purposes, she generally has to take him at his word. "I'm the only inspector here, and I don't have time to look at everything," she says.
Even if an assessor turns down a person's request for agricultural status, there is no guarantee the decision will stick. Landowners have numerous levels of appeal, up to the Colorado Supreme Court. First in line is the county Board of Equalization, which typically is made up of the elected county commissioners. This can lead to appraisal decisions that seem to have less to do with the science of land valuation than with who is making the application.
When the Douglas County assessor denied Jack Vickers's request to reclassify his land from expensive commercial to inexpensive agricultural (and lower his tax bill by 98 percent), Vickers appealed to the Board of Equalization. The Douglas County commissioners ignored their own assessor's recommendation and gave Vickers--a very influential man in Douglas County--the giant tax break.
Members of the equalization board explained that in order to keep a proper distance from influential constituents appearing before them, the commissioners hire an impartial referee to judge the merits of each case.
That's true--to a point. This past summer the Douglas County Board of Equalization hired a Florida man named Peter Ehrlich to judge the Vickers case. After hearing the evidence, Ehrlich recommended against giving the developer the tax break. The commissioners ignored Ehrlich, too. Vickers got the deal.
Assessors insist that their attempts to insure that only real farmers and ranchers get the tax break are not motivated by money. Legally, they point out, their counties can collect only the amount of money they need to operate. Rather, explains Judy Pettit, Jefferson County's assessor, their concern is for how the tax bill is spread around.
As evidence, she pulls out pairs of color photographs she has collected over the years. Three months ago Pettit took pictures of two neighbors on West 82nd Avenue, where the market value of the land is just over $20,000 per acre. Both neighbors have houses on their land, for which they pay separate property taxes. On the empty land portion, however, 11581 West 82nd pays a $432 yearly tax bill. The owner of 12951 West 82nd, who raises dry wheat on his four acres, pays just $4.