Usually the amount a property is taxed is based on what the property is worth on the market. The Agricultural, Forest and Open Space Land Act of 1976, better known as the Greenbelt Law, allows certain land to be taxed on its present use instead. The law is designed to preserve farm and forest land for valuable food and fiber and to maintain open space for public enjoyment by easing some of the burden of property taxes. To qualify, property must meet certain criteria such as land type, size minimums, use, and income produced from farming.
There are 3 types of land which may qualify for greenbelt classification: Agricultural, Forestry & Forest Management Plan, and Open Space land.
Land which is part of a farm "engaged in the production or growing of crops, plants, animals, nursery, or floral products." The property may include some areas which don't produce farm products (such as woodland and wasteland). It may also include a homesite for the owner or operator, which is assessed at market value, not use value. The tract of land must contain at least 15 acres to qualify. A parcel of property that is at least 10 acres, but less than 15 acres, can qualify for enrollment if the owner has other property in the program that is fully qualified. To qualify for greenbelt, farm property must produce a gross farm income of at least $1,500 per year on average over any three years it is classified as greenbelt. Property may also qualify if you, your parent, or your spouse have farmed the property for at least 25 years, you continue to live on the property , and it is not used for any purpose inconsistent with farming.
Land is property of 15 acres or more used in the growing of trees "under a sound program of sustained yield management" or containing an amount or quality of tree growth which is managed like a forest. Although forest property does not have to produce a specific income to be considered for greenbelt, a forestry plan detailing the acreage, the amount and type of timber, actual and potential growth rates, and proposed management practices to be applied to the land, must be developed and filed as part of enrollment. For additional information regarding forest management please visit the Tennessee Division of Forestry web site.
Land is property of at least 3 acres maintained in an open or natural condition. This type of property benefits the public because it conserves natural resources, provides a natural setting for people who might not otherwise have access to such a place, and provides "relief from the monotony of urban sprawl." Requirements for qualification of open space land include a plan for preservation approved by state or local planning agencies, or the execution of a perpetual open space easement.
The law limits the amount of property which can be qualified for greenbelt to 1,500 acres per owner per county. If an owner owns property with others or as part of a corporation, partnership, etc., each owner is credited with their proportionate share of the acreage towards that limit.
When a property that has been assessed as Greenbelt becomes disqualified the owner may be liable to pay what are referred to as “rollback” taxes on the property. “Rollback” is simply the difference between the Greenbelt assessment and the market value assessment that would have been applied if the property had not been in the program. In effect, it is paying back the tax savings the owner enjoyed under greenbelt. For Agricultural and Forest properties the rollback period is 3 years (the current year and the 2 preceding years), for Open Space property the rollback is 5 years. If only a portion of the property is sold or converted to a non-qualifying use, rollback is only assessed on that portion, as long as the remainder of the property still qualifies. An owner should fully understand “rollback” before applying for the Greenbelt program.
Listed below are reasons for disqualification of Greenbelt classification:
- size of tract or use no longer meet qualifications
- the owner requests in writing to withdraw
- the property is covered by a recorded subdivision plat or an unrecorded plan of development and any portion of the land is being developed
- an owner fails to file an application required by the statute
- the land exceeds the acreage limitations of the statute (taxpayer is limited to 1,500 acres per taxing jurisdiction)
- property is sold and converted to other use
Applying for Greenbelt Classification
Owners of properties that meet the criteria for enrollment in the Greenbelt Program can fill out the Agriculture or Forestry application, have it approved, notarized, and recorded (recording takes place in the Register of Deeds located in the same building) all in one short visit. To be effective for the current tax year, the application process must be completed no later than March 15.
For more information on the greenbelt application procedures and your rights and responsibilities as a greenbelt owner please contact us.