Comments pubwvj has made

Deductions for Conservation Doesn't Work for Many

The premise of this idea (Land conservation easement donations producing tax deductions) is based on the idea that you have excess income that can be offset. That doesn't work for most small farmers. I'm cash poor but I'm land rich. I have a lot of land and little cash.

If I give away the development rights to a land trust then I am giving away my retirement, my insurance policy, my savings and there will be no benefit because the "tax incentive" is useless - I don't have enough income to offset. That is true for most small farmers.

One of the things I have run into is that the land trust people, and others, don't understand that our land is our retirement fund, our health insurance, our disaster insurance, our savings. We don't have a 401K, IRA or any of those fancy things. We also aren't likely to get much or any social security even if the system exists down the road. I can't just give away for free the equity that we have worked hard to build up. Would you just hand your retirement plan over to some bum on the street?

Just as importantly the land trusts offer only a pittance for the high value of our land's development rights. Mostly the land trusts want us to donate the development rights but sometimes they offer to buy them. Their explanation is they have a tight budget - hey, I understand, but so do I. Land trusts offer about $2,000 per acre. I can sell the land for $5,000 to $100,000 per acre. If the land trust wants to get the land then they need to offer a lot more. The math says it is better for me to sell a few acres for home lots - I'll get a lot more money than conserving a lot of land - and then continue to farm the remaining land.

The process of going through with the land trust is very expensive and complicated. I've worked through it multiple times and I really don't have the time to waste. I've got farming to do. In the times I've dealt with land trusts I have felt like they treated me as if I was not important. That's fine. If they've got other fish to fry just say so. Instead they drag the process out. Take huge amounts of time to respond. Miss deadlines. Change personnel. Lose files. In general an unprofessional process and a waste of my time.

There is no long term tax incentive because my real estate taxes, one of our biggest annual costs, don't go down when the land trust buys the development rights. In fact, they actually could go up. It's complicated but a real factor and not something the land trusts like to talk about.

Then there are the tax disincentives. My real estate and income taxes will get more complicated and possibly higher every single year if I do the land trust thing. I would have to pay a capital gains tax on the income from the sale of the development rights at both the federal and the state levels. My tax forms go from being something I can handle to something requiring an 'expert' who makes hidden mistakes (been there, seen that) and costs me a lot each year. The government has put hurdles in the way that make this sort of thing even less appealing.

As much as I like the idea of land trusts and conservation the system is not working for small farmers. The whole thing is geared toward rich folk who want to donate the easements on their land and gain a tax benefit to offset their high income. Small farmers are in a very different boat and the whole land trust thing isn't working for us or other small farmers I've talked with.

What we really need is to end all subsidies. Subsidies go to only a few (6%) of farmers and most of those are big corporations. This means that my tax dollars are helping my competition and I don't like that. We need to eliminate the subsidies to everything, not just farming. If all subsidies were eliminated then the cost of petroleum would take on it's real value. That would mean there would no longer be the shipping of cheap goods half way round the world or even across the country. This would create more local jobs in farming, manufacturing and other job sectors. Yes, there would be some turbulence as the market settled but we would save on taxes when we no longer spent hundreds of billions on subsidies - that would offset the price increases.On Why "the market" alone can't save local agriculture posted 2 years, 2 months ago 9 Responses

We don't need subsidies

We don't need subsidies. We need a reasonable environment and economy that encourages farming and individual self-sufficiency. I'm not talking about "survivalism", I'm talking about people having gardens, chickens, a summer pig, etc. What has happened with urbanization is that people have become too disconnected from their sources of food.

One problem with the subsidies is the hurt the unsubsidized farmers like moi. Big-ag can devote the dollars and hired guns to get their "share" of the subsidies racking up big profits from them. Small and Micro-farmers, who are your local producers selling at farmers market and direct to consumers, are then faced with fighting against a subsidized product in the market place. I say eliminate all of the subsidies.

However, there is another issue that hurts small farmers even more and that is the real estate valuation and over taxation. That's turning cropland into condos at an ever increasing rate. Pretty soon you'll have plentiful places to live but nothing to eat.

-Walter
Sugar Mountain Farm
Pastured Pigs & Sheep
in Vermont
http://SugarMtnFarm.com/blog/
On Where farm subsidies came from, and why they're still here posted 2 years, 9 months ago 2 Responses