The Current Abuse Program

Current Use, who wouldn’t like it? Preserving farmland, protecting the forest, ensuring that Vermont doesn’t become just another giant strip-mall, the trouble is, it’s a double-edged sword. This program, like most spawned by well-meaning lawmakers, has grown into something that threatens to destroy the state it means to save. 

In last week’s Vermont Standard,  our State Representative, Alison Clarkson, gave us a synopsis of how the legislature is dealing with the $150 million deficit they created when they overrode Governor Douglas’ veto of the last budget. She informs us that the ‘first real savings’ were voted on last week: the $1.6 million ‘saved’ in changes made to the Current Use Program. She tells us they were originally supposed to save $3.2 million, but that that would be devastating, so they finagled it so they only had to save half as much. 

If you’re in Current Use, you know exactly how it works, you pay approximately 1/8th of the property tax that everyone else pays. To use Alison’s words, “it’s a tax policy which taxes land on its ‘use’ value and not it’s market value”. (Forest land is currently assessed at a use value of $97 per acre). The goal of Current Use is to prevent development and keep the land in a 19th Century rustic state. Essentially it is a tax subsidy to people who own 25 or more acres of land as long as they follow state diktats on how they use it. Farm it the way they say, log it how they tell you, fill out the proper, forms and they’ll knock 88% off your taxes. Again, for farmers and legitimate loggers, who could argue? Few of us really want to see farms disappear and see our forests stripped to the bone like they’re doing in the Amazon. But the well-intentioned program, obeying the law of unintended consequences, is not benign. People have to pay for it... if someone pays less tax, others pay more. For many it’s a tax shelter, pure and simple, a particularly rewarding one, thus people are lined up to get into the program. How much land is currently covered by Current Use? Over 2.2 million acres. We’ve only got 6.1 million acres, so over one third of Vermont’s land is being subsidized.

So how did the State save that 1.6 million dollars? It did it by keeping people out of the program. They called for a one-year moratorium. Want to sign up? Sorry, you’re going to have to wait for at least 12 months, you’ll have to pay your full dollop this year. You can have the break in 2011, when as Alison says, ‘the economy has returned to some normalcy”. Was there an alternative to the moratorium? What about the idea of divvying up the needed savings amongst the current participants? The 12,500 current users would have to chip up $128 each to meet the goal. No, the Ways and Means Committee has decided that it is better to stall a couple of hundred people for a year, collecting an average of $6000 of tax they wouldn’t normally have to pay, than to even slightly affect the sacred cows that are already enrolled. 

The question you have to ask is who are these couple of hundred people? Are a bunch of new farmers moving into the State? Are there new forests popping up that suddenly need your protection? Or are some people just sort of slow on the uptake and just never really understood that they could have saved tens of thousands of tax dollars over the last 30 years if they’d just had a clue about how to use the system? And what about the 24% of the participants who are out-of-state homeowners? We’re expected to believe that they need our subsidies to protect their land? The truth of the matter is the system is rife with abuse, it needs to be looked at closely and reformed drastically. Most of all, the lawmakers who vote for and defend environmental legislation have to understand there’s a high price tag attached. 

The true irony of the situation is the enormous number of signs going up that accompanies the process. Not highway billboards or downtown Fedex posters, I’m talking about Posted Signs. Drive along any of our dirt roads nowadays and you can’t fail to see the abundance of yellow Keep Out, No Hunting, No Trapping, No Trespassing signs now being plastered on trees and poles. I’ll give you a clue, it’s not the loggers and farmers that are putting them up. It’s folks who want to live in Vermont without the inconvenience of having Vermonters tramping across their land. It really is a travesty, you’re told that subsidizing the land is for your benefit, but you’re not allowed to visit it. Our tax dollars are being used to create private environmental theme parks that you can only look at from the outside, Under Penalty of Law.

I asked Alison once why the state didn’t adopt a New Hampshire approach of a two tier system, where posted land is taxed at a different rate, her response was that “we give such a huge benefit, 88.4%, it is very hard to consider giving more in this economy”. I think she missed the point, it’s not time to give away more, it’s time to ask more. The State has given away way too much, for way too long. It’s finally found itself in a position where the piper has to be paid. The people of Vermont are tapped out and it’s time to make some tough choices, not just kick the problem down the road like the proverbial tin can.