Marginal property tax effects of conservation easements: a Vermont case study

Conservation easements allow landowners to transfer their land's development rights to another entity, usually a nontaxable conservation organization. Conservation reduces the town's tax base, necessitating a tax rate increase to maintain service levels. However, conserving land also decre...

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Bibliographic Details
Published in:American journal of agricultural economics 2004-11, Vol.86 (4), p.919-932
Main Authors: King, Jonathan R., Anderson, Christopher M.
Format: Article
Language:English
Subjects:
Agricultural economics
Agriculture
Conservation easements
Costs
Easements
Estimating techniques
generalized estimating equations
H710
L310
Land conservation
Land development
Land tenure
Landowners
Local taxes
Municipal taxes
Natural resources
Nature conservation
Open spaces
Prices
Property taxes
Property values
Q510
R140
R510
Studies
Tax base
Tax increases
Tax rates
Time series
Towns
U.S.A
Valuation
Vermont
Wildlife conservation
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Summary:Conservation easements allow landowners to transfer their land's development rights to another entity, usually a nontaxable conservation organization. Conservation reduces the town's tax base, necessitating a tax rate increase to maintain service levels. However, conserving land also decreases the supply of developable land and provides open space amenities that may be capitalized into the value of nearby properties. These effects may offset the decrease in the tax base caused by the easement. Using a sample of twenty-nine Vermont towns, we show that private conservation easements increase property tax rates in the short run, but are tax-neutral or tax-suppressing in the long run.
ISSN:0002-9092
1467-8276
DOI:10.1111/j.0002-9092.2004.00643.x