The county commissioners are considering enacting a state tax benefit for preserved farms, one that would permanently freeze the rate at which those properties are taxed.

They would need the consent of municipalities and school districts in order to institute the program.

But first, they need answers, said Dick Shellenberger, commissioner chairman.

The state initiative — known as Act 4 — was passed in early 2006. It permits taxing bodies to freeze the millage rate on preserved properties if all three — the municipality, the school district and the county — approve the move.

"Obviously I'm for anything that helps support agriculture and keep it viable," Shellenberger said. But before he can make up his mind, the commissioner said some language in the legislation must be amended.

For example, as written, the legislation seems to exclude farms preserved by the non-government, non-profit Lancaster Farmland Trust. The organization is responsible for 265 of the 950 preserved farms in Lancaster County. The majority of its clients are Plain-sect farmers.

"That's the first issue to resolve," said Matt Knepper, director of the county's Agriculture Preservation Board, which has preserved the other 685 farms.

Knepper raised the concern in a meeting with the board of commissioners on July 30.

Shellenberger said he and commissioner Sharron Nelson were "blown away" by the apparent exclusion of the Trust. (Commissioner Molly Henderson did not attend the July meeting).

Since then, Shellenberger said he has gotten assurances from state Sen. Mike Brubaker and attorneys for the Trust that both are working on an amendment to the act.

Karen Martynick, director of the Lancaster Farmland Trust, lamented that while her organization was aware of the Act when it was being drafted, she never assumed that farms preserved by the Trust would not qualify. Nor did anyone else involved, she said.

"I think it just never crossed anybody's mind," Martynick said. "We tend to lump all preserved land together (in Lancaster County)."

Eliminating or freezing taxes on preserved farms was declared "highest priority" by the Blue Ribbon Commission for Agriculture in Lancaster.

"These farms cannot be developed and should be taxed as such," the group's recommendation states. As a further benefit, the commission's report states, the tax break will encourage preservation for other farmers.

"One of biggest criticisms of preservation now is 'what happens to the next generation?'" said Dan Zimmerman, chairman of the Blue Ribbon subcommittee on tax relief. Act 4 answers that by securing a benefit for all future owners of the preserved land, he explained.

"What you're really doing is making this more attractive to other farmers," Zimmerman said.

When Warwick Township decided to examine the issue in June 2006, Zimmerman, its manager, gathered a local committee of representatives from Warwick, Lititz Borough, Elizabeth Township and the Warwick School District. Zimmerman represented his township and the Blue Ribbon Commission during discussions.

The committee met once or twice, he recalled, and though its research indicated that approving the measure would be good for the area, members decided to enlist the Pennsylvania Economy League for further analysis.

"That's when we stepped back," Zimmerman said. "We wanted a more objective source."

He has yet to receive any feedback from the League, Zimmerman said today.

Some other municipalities have taken a look at the issue. In May, the Hempfield School Board approved the measure 8-1, with one member abstaining.

To date, Lehigh remains the only county that approved the Act, enabling the school districts and municipalities to agree to enact it. About half of them have done so.

According to data compiled by the county assessment office, the preserved land in Lancaster County is worth around $685 million. About $250 million of that is taxable value.

Assessment director Dee Dee McGuire estimates that freezing millage rates for all preserved properties will cost the county $638,750 in tax revenue over the next five years, assuming a five percent annual increase in the taxation rate.

The loss to school districts will likely be at four or five times that.

Even before numbers are crunched, legal questions linger.

For example, county officials have wondered what happens to the frozen rate if the general millage rate goes down, as often happens after reassessment? Would enrolled property owners be paying higher taxes or does freezing mean the lowest possible rate?

Would properties enrolled in the Clean and Green tax break program be eligible for the freeze? Currently, a proposed amendment is seeking to specifically exclude such farms.

Knepper also noted that a frozen millage rate would likely increase interest in the county's preservation program. New applications might mean the county can fill in preservation gaps in the eastern part of the county, Knepper said, which has the best soil type, the most development pressure, and the weakest preservation record.

It might also mean a longer waiting list, he said, adding to the 200 farms currently on the list.

CONTACT US: alitvak@LNPnews.com or 481-6020