Current-Use Property Assessment and Land Development

During the 15 years after 1982, the developed area of the U.S. grew by more than a third. In addition, developed regions became less densely populated—inevitably resulting in a loss of crop and grazing lands, forest cover and wetlands across the nation. Between 1960 and 1990, nearly all state governments responded to these land use trends by enacting statutes and constitutional amendments mandating current use, or use-value, assessment of certain categories of rural lands for tax purposes. This form of property assessment was intended to reduce financial pressures to develop rural parcels in the face of escalating market values. This paper seeks to explore whether current use assessment can protect rural lands from development, surveys the actual penalties operative in the various states during 2002, and speculates about which states are more likely to have effective land preservation programs.

This report is a result of a David C. Lincoln Fellowships in Land Value Taxation.