Higher taxes, guaranteed

By Henry Lamb

When you hear the words “open space,” think tax increase. When you hear such terms as “urban boundary,” or “smart growth,” or “protect the land,” think tax increase. Higher taxes are guaranteed.

For the last decade, the federal government, and nearly every state, have been on a “land acquisition” binge. Promoted by environmental organizations, government has focused on buying every square inch of land it can afford. The land it cannot afford to buy, it tries to depreciate by clouding the title through easements and other use restrictions.

The money to buy the land, or clutter the title, comes from taxes. But that’s the least of the tax nightmare.

Every square inch of land that government acquires, shrinks the base of taxpayers from which tax revenue can be extracted. This means that the remaining property owners, and users, must pay a higher tax rate.

Urban dwellers who lease apartments in sustainable communities rarely consider that the rent they pay includes the property tax paid by the building’s owners. In every community, when government shrinks the taxpayer base by acquiring land, every citizen is forced to pay a higher tax rate to compensate for the tax loss, whether directly through a tax bill, or indirectly through higher rent, or higher prices for goods and services.

Richland County in South Carolina is in the process of implementing its comprehensive land-use plan, which designates land beyond the urban boundary to be “protected” for some imagined environmental benefit.

Totally aside from arbitrarily denying the landowners the right to use their land as they wish, the plan automatically forces everyone else to pay taxes at a higher rate than would be necessary if the land outside the boundary could be used for its highest economic purpose. Because the designated “protected” land is forever condemned to be “open space,” it can produce only minimal tax revenue, if any. There is little incentive for a landowner who is denied the opportunity to use his land to continue to pay taxes on it. Sooner or later, it is likely to be added to the government inventory, and produce no taxes at all.

When the federal government buys land from private owners, or clouds the title to land through easements and restrictions, it has even greater impact on local property tax revenues. The federal government pays no property tax. In the West, the federal government makes PILT (payment in lieu of taxes) payments to some governments. These payments come from the taxes paid by urban dwellers in the East, but these payment are never more than a small percentage of what private land owners pay in property taxes.

Florida is a prime target for the transformation of private property to public ownership. The goal of the Wildlands Project is to eventually transfer 90 percent of Florida land into government ownership, and government is rapidly achieving this goal. Through a constitutional amendment a few years ago, Florida has established a perpetual fund expressly for land acquisition. The federal government is buying Florida land at a dizzying pace. Federal grants to The Nature Conservancy, and other environmental organizations, to acquire land, or clutter-up the title to private property through easements and acquisition of development rights, is effectively removing Florida land as a source of tax revenue.

Tax revenues from private property owners provide the major source of revenue for local governments. This river of revenue diminishes with every acre of land that is “protected” by government. As the revenue stream continues to diminish, local governments must depend upon the state, and federal government for revenue. Both the state and the federal government need simply to increase the tax rates on the various forms of taxes they collect. The bottom line, however, is that everyone must pay higher taxes.

Local governments, the government closest, and most accountable to the people, have already lost most of their authority to state and federal mandates. When local governments lose their only independent source of revenue, they will truly be nothing more than administrative units of state and federal government.

Federal, state, and local governments already own more than 40 percent of all the land in the United States. There is no accumulative record of how much more private property has been devalued by fragmented titles resulting from conservation easements and acquisition of development rights. Environmental organizations conspire with policy makers to aggressively acquire more land and fragmented land titles, in every community, in every state.

Every time you hear the phrase “We must protect this land,” know that higher taxes are guaranteed.