ADDISON COUNTY — Gov. Peter Shumlin has made cleaning up Lake Champlain a top priority. To do that, he proposed in his Jan. 8 inaugural address to make changes to the state’s Current Use tax program to penalize farmers who pollute waterways.
The Agency of Agriculture said denying Current Use tax breaks to offenders would add another enforcement tool to the state, which is cracking down on pollution into its waterways.
But the Vermont Farm Bureau and some farmers said that’s unnecessary, and instead the state should use the broad enforcement powers of the Agency of Agriculture to get offenders to comply.
“I think there are other ways of getting at it,” said Bob Foster of Foster Brothers Farm in Middlebury. “There are already rules from the Agency (of Agriculture); they already have authority to pursue penalties if there is pollution.”
Current Use, first created by the Legislature in 1978, is a tax structure that offers significant property tax discounts for landowners involved in agriculture or forestry.
Instead of being assessed at fair market value, land is assessed at a flat rate that is much lower. Unsurprisingly, the program is popular — one third of Vermont’s 6.1 million acres are enrolled in Current Use.
State officials support the program for making farming more affordable and also discouraging development, since land taken out of Current Use for commercial activity would again be taxed at market value.
The governor’s directive would empower the Department of Taxes to take polluters out of Current Use. The logic is simple: When hit with a much larger tax bill, polluters will be more eager to correct violations in order to get back into the program.
Agriculture Secretary Chuck Ross told the Independent that the agency would only threaten to take land out of Current Use if a polluter repeatedly fails to correct violations formally identified by the agency.
“We thought it made sense that for someone who has been provided due process for a violation, and can’t comply with the rules, therefore imposing costs on the rest of us through pollution, that they wouldn’t also receive tax benefits,” Ross said.
Only the most egregious offenders, Ross said, would face removal from Current Use. He stressed that only a small fraction of farmers fail to comply with agency regulations.
“There are very few, but they tarnish the image of everyone else,” he said.
The secretary said since most farmers follow the rules, the policy change will affect few of them. He said the best way for farmers to stay in the clear is by adhering to the Accepted Agricultural Practices, or AAP, a sort of code of conduct adopted for farmers by the Legislature in 1995.
FARM BUREAU RESPONDS
Farmers raised concerns about the governor’s proposal. Bill Moore, the Vermont Farm Bureau’s legislative director, said he was glad to hear the governor’s address focus on cleaning up Lake Champlain, and agreed that agriculture is part of that solution. But he said using Current Use as a policy tool is not the way to do that.
Moore took particular issue with an interview Shumlin gave to Vermont Public Radio Jan. 9, in which the governor said neighbors “are subsidizing, or helping pay for” property taxes for landowners enrolled in Current Use.
“The governor called Current Use a subsidy for farmers, which is a really dirty word in our business,” Moore said. “It’s not OK to look at it that way.”
Moore said the governor’s logic is backwards — it’s actually farmers and foresters that are helping their neighbors. He argued that land in Current Use does not draw heavily on municipal resources, such as roads and utilities.
“Cows don’t have kids to go to school or cars to drive up the road,” Moore reasoned. “Even with the adjustment … you could still argue they’re subsidizing the local tax rate.”
Instead of threatening to remove land from Current Use if farmers pollute, Moore said the Shumlin administration should use the Agency of Agriculture’s existing powers to enforce the law.
“The secretary and the agency have a broad array of tools, statutory and regulatory,” Moore said.
But while the agency is empowered to bring polluters into compliance, Moore said it lacks the staff to enforce the law widely and evenly.
“They don’t have enough staff, as far as I can tell, to deal with the complaints they get,” he said.
All farms, regardless of size, are required to adhere to AAPs. But Moore said the agency does not have enough staff to educate farmers about these practices.
On a broader scale, Moore said he believes the governor’s change to Current Use is antithetical to the purpose of the program — to encourage farmers and foresters to keep land in those uses, rather than develop it for commercial uses. If farmers are forced out of Current Use, Moore reasoned, they are more likely to sell their land to a developer.
Moore said the Shumlin administration did not consult the Farm Bureau before the governor announced the Current Use change, but speculated that was likely because the organization’s stance on Current Use has been unambiguous.
“The governor and many previous administrations are well aware of the Farm Bureau’s policy on Current Use,” Moore said, “which is that if any policy goals are attached to it, it reduces in value in the eyes of Vermonters. It has a heritage, and anything you add to it reduces its integrity.”
Bob Foster of Middlebury said he also does not view Current Use as a handout to farmers.
“Current Use really is not a subsidy, it’s fair taxation,” Foster said. “That lower tax rate is what its use value is.”
Foster said he was puzzled why the Shumlin administration plans to use Current Use as a tool to encourage compliance, given the Agency of Agriculture’s broad enforcement powers.
Foster concurred with Moore that the state needs to do a better job educating farmers about AAPs, as well as provide funding to help farmers come into compliance if they are not. Foster said most farmers take pollution seriously, and want to be part of the solution, not the problem.
“Farmers in general pride themselves on being good stewards,” Foster said. “By and large people want to do what’s correct.”
AGENCY OF AG STRETCHED
Ross acknowledged that his agency does not have enough staff to accomplish its goals, particularly with small farm operations.
“We have a capacity in the agency to work with large farms and medium operations, but many of the small farms don’t have staff to work with regularly,” Ross said. “That’s a staff issue that’s been present since I came to the agency four years ago, and we hope to augment staffing significantly.”
Ross said Vermont is looking to the U.S. Department of Agriculture to provide funding for additional staffing, and also to help polluters address violations. U.S. Agriculture Secretary Tom Vilsack, during a visit to Vermont in August, announced $45 million in aid to help Vermont clean up Lake Champlain.
No matter where the money comes from, Ross said, the goal is to educate all the contributors of runoff into waterways on the best way to manage runoff.
“What we’re trying to do, through federal funds matched by the state … is to create a culture of stewardship and accountability for farmers, developers and residential landowners,” he said. “We all need to do a better job, and we all need to do this together.”